The Korea Herald is publishing a series of articles titled Global Brand as part of the first installment of Power Korea. Korea’s success story is a 60-year-old tale written by not one, but many who worked to build one of the world’s most powerful nations from the ashes of war. This Global Brand series is designed to honor those who made this Korean Dream come true. This is the 17th part of the Global Brand series. ― Ed.
Ottogi is one of the best-known food brands in Korea. Its roots go back as far as 1969, when there were few Korean firms with proper business operations.
Many Koreans in their 30s and 40s would say they grew up on Ottogi food, which runs the gamut from staples like curry and noodles to condiments such as ketchup and mayonnaise.
But some might not know that this company, once dismissed by its conglomerate rivals, currently has almost 30 products with leading market shares and operates overseas offices and plants, while its stocks are valued at near $400 per share.
After making a name for itself as the nation’s first manufacturer of instant curry ― the famous Ottogi Curry ― Ottogi has grown step by step into a vast global company.
The formula to Ottogi’s success is as simple as its history that has never once flirted with anything outside of food: hard work.
Since its inception, Ottogi has persevered to stand out in the food industry. Based on this goal, the company has worked strenuously to provide the best-tasting and most nutritious foods available.
Ensuring this quality is Ottogi’s state-of-the-art plant facilities that are open to the public on a regular basis for inspection and to share Ottogi’s love for food.
“Our persistence to offer only the best quality is how we attained credibility with our customers,” said Ham Young-joon, chairman of Ottogi who took over the business from his father, the company founder Ham Tae-ho.
Chairman Ham Young-joon. (Illustration by Park Gee-young)
Today, Ottogi produces about 500 foodstuffs including instant noodles, curry, ketchup, mayonnaise, vinegar, oil and fat products and canned fish.
Introducing new tastes
Ottogi items are easily found at the local grocery store, but the situation in the ’60s and ’70s was quite a different story.
In fact, Korea was chiefly reliant on imports, which failed to satisfy local tastes and were also unhealthy due to poor logistics.
It was against this backdrop that Ottogi introduced the first Korean-made curry and condiments.
Ottogi grew in tandem with the Korean economy as tastes became more sophisticated and diversified, and also as more people came to demand less time-consuming processed foods that are also healthy.
Soup, dairy products, canned fish, instant noodles, sesame oil and frozen food made by Ottogi consequently hit the store shelves.
What’s more important, Ottogi says, is that these homemade products held steady in the face of a rush of imported brands.
Meticulous control of taste and sanitation, along with close attention to the eco-friendly dynamics of the modern food industry are other factors behind Ottogi’s success, according to company executives.
“Eco-cook, Eco-factory, Eco-partner, Eco-drive and Eco-office are the five initiatives Ottogi undertook to make sure Ottogi stays environmentally sound, while at the same time maintaining quality control,” said Seo Dae-gyo, a spokesman for Ottogi.
Eco-cook reflects the company’s efforts to reduce environmental waste during the cooking phase of Ottogi products, while Eco-factory is about minimizing pollution and waste at its plants.
Eco-partner is a drive to draw more people of related interest to pay more attention to eco-friendly issues, while Eco-drive urges Ottogi employees to take bigger part in helping solve climate change problems and reduce environmental impact in the logistics process. Last but not least, Eco-office encompasses all of Ottogi’s efforts to together mold a corporate culture that’s most compatible with the environment.
Ottogi’s mayonnaise, one of the firm’s bestsellers touting an 80 percent share here, last year celebrated the 40th anniversary of its launch.
Over the past 40 years, Ottogi sold around 1 million tons of mayonnaise, meaning that if the tube-packaged mayonnaise were put end to end, they would make a line long enough to go around the world more than 15 times.
It also means each Korean has consumed at least 70 Ottogi mayonnaise tubes.
But that’s not all. Around 50 billion won ($45 million) worth of Ottogi’s mayonnaise is exported, meaning that it has captured foreign tastes as well.
The beginning of mayonnaise had been a difficult one, since the product is naturally prone to environmental changes such as temperature, sunlight and storage surroundings. Ottogi admits refunds had eclipsed sales at first.
But eventually, the company was able to overcome these problems to shoot up to No. 1 in the market, beating out competition such as Lotte and foreign-based rivals.
One example is a firm created by a joint venture between CPC International, a global mayonnaise maker, and Daesang, which was at the time named Miwon and up to 10 times bigger than Ottogi.
Not to be outdone, Ottogi went through painstaking market research, after which in 1984 it launched its “Gold Mayonnaise,” an upgraded version of the existing mayonnaise. Gold mayo eventually beat out the joint venture.
U.S.-based Heinz also lost out in the competition against Ottogi, retreating from Korea after failing to gain the upper hand in the mayonnaise market.
Meanwhile, Russian consumers who had a taste of Ottogi’s Gold Mayo became avid customers. Every year, up to 50 billion won worth is sold in Russia, making the mayonnaise a bestseller with a 70 percent market share.
Ottogi currently sells in 30 countries in the Americas, Europe, Asia and Africa.
Ottogi also has operations in China, along with a plant in New Zealand that allows the firm to offer fresher and more eco-friendly raw materials, the company said.
For the future, Ottogi plans to delve deeper into healthier foods to introduce more food for children, the elderly and people with weight problems.
By Kim Ji-hyun (email@example.com)