A year and a half after starting to sell high-end whiskey at internet duty-free shops, expensive liquor has claimed the top ranks of popular products at major internet duty-free shops.
Alcohol is essential for duty-free shopping. Especially, high-end whiskey is a high-tax item, with tax accounting for more than half the price.
The satisfaction with the price increases when purchasing such products duty-free. Particularly, travelers can bring in two bottles (each under 2 liters) and additional items valued under $400 duty-free, separate from the entry duty-free limit of $800. This explains why even travelers who do not enjoy drinking include expensive whiskey on their duty-free shopping lists.
According to Chosun Biz on the 19th, among the products offered by Shilla Duty Free this year, Balvenie 25 Year Old ranked first in popularity. This product generally sells for around 2 million won in the market, while Shilla Duty Free's selling price is 1.07 million won. With additional discounts, it can be purchased for about half the market price.
The third place is occupied by Dalmore 20 Year Old. This product is also a high-end whiskey, priced at 920,000 won at the duty-free shop. The fifth-ranked Kavalan Vinho Barrique Solist 1-liter product is 190,000 won. The 10th position, Loch Lomond 47 Year Old, is priced at 6.64 million won. Among the top 10 popular products, four are liquors.
Other duty-free shops are not much different. At Korea's largest duty-free shop, Lotte Duty Free, Johnnie Walker Blue Label ranks 6th overall. Eighth is M6 Plus, which Chinese President Xi Jinping reportedly cherishes, and 11th place is occupied by Ballantine's 30 Year Old.
At Shinsegae Duty Free, the fifth and eighth places are held by Taiwanese whiskies Kavalan Port Solist and Vinho Barrique Solist, respectively, while M6 Plus ranks 10th.
It has been less than two years since internet duty-free shops began selling liquors. Until then, purchasing alcohol was only possible through city duty-free shops or by booking with airline or shipping companies due to regulations requiring the segregation of the sales and delivery locations.
Even that was rare, as there was a strong perception that 'high-end alcohol must be purchased after seeing the actual product.' Consumers who reserved liquor and then picked it up rarely existed.
However, since the National Tax Service implemented a revised notice allowing orders of liquors for remote sale from July last year, customers can now order and pay for liquors along with other duty-free items at internet duty-free shops. This allows for advance orders through smart orders to receive items at the departure location.
After that, young consumers who became comfortable with liquor smart orders began ordering liquors in large quantities at internet duty-free shops, leading them to competitively secure supplies of alcohol. They also take the lead in exclusive sales of hard-to-find products.
Lotte Duty Free has started to sell a limited edition of Glenallachie single malt whiskey, 'Glenallachie Single Cask 2013 11 Years PX Hogshead,' exclusively at their internet duty-free shop this month.
Shilla Duty Free opened the only liquor specialty flagship store at Incheon International Airport's Terminal 2, covering an area of 96 pyung (approximately 3,200 square feet).
Industry experts evaluate, 'Even in a situation where the value of the won has declined (as the won-dollar exchange rate has risen), high-tax liquors still maintain price competitiveness at duty-free shops, leading to significant sales.'
Conversely, as liquor sales at internet duty-free shops increase, the competitiveness of imported liquors that have gone through formal import procedures and paid taxes is declining.
Most travelers shop at duty-free stores for domestic use, but in principle, items purchased duty-free should be consumed abroad, not in their home country.
The same goes for liquor. If alcohol purchased at internet duty-free shops is not consumed abroad but brought back into the country, the liquor duty-free limit of $400 must be taken into account.
For example, the Balvenie 25 Year Old, Dalmore 20 Year Old, and Loch Lomond 47 Year Old products, which are popular items at Lotte Duty Free, all require travelers to report exceeding the duty-free limit when bringing them back into the country after purchase. However, the number of voluntary reports is extremely low, as many exploit the fact that customs cannot comprehensively check all travelers.
Kim Joo-han, a bartender at Blue Brick Bar in the United States, noted, 'Unlike other countries' duty-free shops that prioritize domestic products, there are no major duty-free shops in the country that properly handle traditional liquor. The reason liquor is duty-free is not because it is a shopping item, but because it is treated as a travelers’ personal item according to the Kyoto Protocol, yet duty-free shops have turned it into a means of selling at a markup.'