HIGH SPENDING FUELS S. KOREA BEER BRAWLS

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SEOUL-The beer wars are frothing over at unprecedented spending levels as longtime market leader Oriental Brewery fights off its first real competition.

To defend its turf against No. 2 Chosun Brewery and Jinro Ltd.'s joint venture with U.S. giant Coors Brewing Co., OB shelled out a stunning $3.1 million for advertising in March alone, according to Korea Advertising Data Inc. The rise in spending, also occasioned by OB's ice beer introduction, propelled the brewer from the 51st largest advertiser to No. 9.

That's only the beginning for OB, however: An executive from OB's agency Oricom, said the company plans to spend another $31.2 million on its Ice beer this year.

No. 2 Chosun, meanwhile, anted up $2.2 million in March, up from $670,000 a year earlier, Korea Advertising Data Inc. said, to catapult from the country's 52nd largest advertiser to No. 12 last year.

Jinro is also expected to spend $9.9 million on its Cass beer in the second quarter of this year alone.

The sudden surge of activity is unusual for Doosan Group's OB, which has monopolized South Korea's $2.1 billion beer market for more than 30 years with a 70% share. Chosun seemed content with the remaining 30%.

Then, in 1993, OB was hit with a double-barreled surprise. Sixty-year-old Chosun decided to upgrade its image by introducing its highly successful Hite brand, and Jinro, a newcomer to beer, linked up with Coors as a one-third partner to introduce Jinro Cass beer.

The marketplace strategy for both the Chosun and Jinro beers focuses on clean water, a new positioning approach here.

Moon Sang-Mok, Jinro-Coors president, said, "Our strategy is to make pure, clean and fresh draft-type beer by taking advantage of the worldwide-acclaimed Coors brand as well as develop [our] own brand," referring to Cass, handled by LG Ad.

"Clean" was also the selling point for Chosun Brewery's Hite, a plus in a market shaken by the discovery of benzene in water last February.

But the approach has also caused controversy. The Fair Trade Commission ruled June 23 that Hite's print ads proclaiming Hite is "brewed with 100% underground natural water pumped out from 151.8 meters" was misleading, and when the company hadn't altered its ads by July 20, rival Chosun filed suit, still pending.

TV ads ignore that issue. Cheil Bozell's campaign features eight TV stars beside a beer drinker holding a Hite. Each makes a comment about their impression of the beer and the tagline is "Ah! That's why it's Hite."

Chosun's $18.7 million effort with Hite this year appears to be working. OB's share fell from 70% in 1993 to 64% earlier this year while Chosun moved up to 36%.

By yearend, industry watchers predict that Jinro will grab an 8% to 10% share.

OB maintains it's not fazed. "OB beers still retain two-thirds of the market share. Thus, the current fight is really over the remaining one-third," sniffed one OB official. Nonchalance aside, OB volleyed back in June with OB Ice, its first "ice" beer.

During its first month on the market, OB Ice sold 505,000 cases, outpacing that of Hite, which sold 192,000 cases during its inaugural month of April 1993.

OB spent a whopping $500,000 to sign Kang Soo-Yon, one of South Korea's top actresses, to pitch Ice beer. The monochrome ad featuring a series of tempting poses is running in major dailies and on TV.

The strategy represents a shift from OB's previous ads, which focused on amateur actors and actresses posing as real office workers. "Softly pulling taste-OB Ice," is the theme from Oricom.

Jinro won't be specific but said it is taking a different approach. "Betting on its high-tech pure taste, Cass will take [yet another tack] from OB Ice or Hite by focusing on taste rather than the use of celebrity models," said an official at Jinro-Coors' agency LG Ad.

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