The business of selling socially acceptable “sins” in today’s dog-eat-dog world requires slick advertising campaigns, eye-catching packaging and retail strategies that cut straight to the chase. Taiwan Tobacco and Liquor Corp., which just celebrated its 109th anniversary, is championing this approach, relentlessly searching for creative ways to tap new segments of the market and diversify its product lines.
“Tobacco and alcohol have always been an inseparable part of the daily lives of Taiwanese people,” said TTL Chairman Hsu An-hsuan, who was promoted from the position of general manager in November 2010.
A glimpse at the history of TTL’s product line proves this point. “Long Life,” TTL’s cigarette brand that debuted in 1958, was the most beloved choice among Taiwanese smokers for nearly 30 years. While Taiwan Beer, whose original formula first appeared in 1920, has long been the most popular beer brand among all walks of life in Taiwan, with a market share of over 75 percent. Statistics have shown that each year, over 650 million bottles of Taiwan Beer are consumed locally.
According to Hsu, TTL is currently in its quest for a new marketing strategy for Taiwan Beer. Over the past two decades, commercials for the drink have focused on its freshness, which the brewer is justly proud of. “However, we have to constantly renew ourselves,” he emphasized.
For example, in July 2009, loyal customers were surprised to see Gold Medal Taiwan Beer, TTL’s bestseller since 2003, with a new logo, bottle design and commercial campaign.
To grab the attention of young consumers, two brand-new brews, “Mine Lager” and “Mine Dark,” were introduced in 2008 and 2009, respectively. “The lighter and less bitter new flavors are catching on quickly, especially with the young,” Hsu said. With its online interactive advertising campaigns that encourage fans to upload fun photos, TTL is clearly making the younger generation its main target.
The storied past of TTL explains why the firm, which is interminably entwined with the fabric of Taiwanese society, places a premium on remaining the local market’s dominant player.
Set up by the Japanese in 1901 during Taiwan’s colonial period (1895-1945), the company had exclusive control over the island’s most lucrative businesses. These included, opium, camphor, salt, and later tobacco, liquor and matches—all major exports from Taiwan at the time.
After the Kuomintang government took control of Taiwan in 1947, the firm was transformed into the state-run Taiwan Tobacco and Liquor Monopoly Bureau, to concentrate on tobacco and alcohol products. In 2002, increasing demand from local businesses to liberalize the market for alcohol and cigarettes saw the bureau transformed into Taiwan Tobacco and Liquor Corp., with the Ministry of Finance being its largest shareholder.
Hsu said that as TTL and its products evolve, so too are its stores. The firm’s franchise outlets, which used to resemble gloomy administration offices, are now more like convenience stores, boasting stacked display cases and young workers wearing brightly colored uniforms. “The company has really taken pains to improve its image,” he added.
TTL breweries have taken this process a step further by becoming cultural centers. Over the past decade, the company has turned its four breweries and nine wineries in Taiwan into venues for cultural and fun activities. They have become living museums that showcase Taiwan’s history and culture as seen from the perspective of an alcohol producer.
For TTL, growing the company requires a global perspective and this begins with expanding into the mainland Chinese market. After several years of negotiations, the brewer finally completed required licensing procedures in 2009, and will soon begin selling Taiwan Beer to mainland Chinese consumers.
“A partner brewery for Taiwan Beer will soon start production in mainland China’s Jiangsu province,” Hsu said. “We have even adjusted its flavor to suit the tastes of mainland Chinese who prefer lighter beer with lower alcohol content.”
TTL’s attempt to diversify its product lines is less a marketing strategy than a response to the public’s growing concern over the negative effects of cigarettes. Besides tobacco and alcohol products, TTL is also known for its cosmetics, low-fat snacks and biotech supplement foods containing byproducts of making alcohol beverages.
Since 2007, many of the company’s biotech products, including Anka vinegar, red wine polyphenol facial masks and Monascus supplement capsules, have been awarded Gold Medals by Monde Selection, a Belgium-based international institute for quality goods. “These awards show that our products have received global recognition,” Hsu said.
Buoyed by strong performances in the Taiwanese market, and with international expansion plans in full swing, Taiwan Tobacco and Liquor Corp. looks set to go from strength to strength in the 21st century. (HZW)
Write to Kwangyin Liu at kwangyin.liu@mail.gio.gov.tw