Loconomy, which combines local and economic elements, is emerging as a new competitive advantage in the food industry. This concept has evolved beyond merely incorporating local ingredients into products to actively promoting regional tourism and collaborating with local governments to stimulate the local economy.
According to industry reports, food and restaurant companies are expanding their loconomy marketing through various methods, including developing products using local specialties, reinterpreting traditional dishes, offering region-specific menus, and expanding agricultural product distribution.
Since 2021, McDonald's has consistently introduced menu items featuring domestic agricultural products through its 'Taste of Korea' project, which includes ingredients like Changnyeong garlic, Boseong pork, Jindo green onions, Jinju peppers, and Iksan sweet potatoes. This year, it launched the 'Chungju Sweet Corn Cheese Croquette Burger' and 'Chungju Sweet Corn Cheese Croquette Muffin.' In conjunction with these new menu items, McDonald's is running promotions linked to Chungju's hometown love donation program and operating a pop-up store in Chungju to support local businesses.
Efforts to reinterpret local cuisine as franchise menu items are also notable. The restaurant chain The Born Korea has initiated the 'Paldo Hong Kong Banjum' project this year. Following the introduction of 'Pork Soup Jjamppong,' a reinterpretation of Busan's signature dish, it recently launched 'Zucchini Pork Stew Jjamppong,' utilizing a local dish from Gwangju. This menu will be available for about two weeks nationwide before becoming a seasonal offering at Gwangju locations, aiming to increase visitor demand and promote local food culture.
Starbucks is offering specialized beverages and baked goods that reflect local history and tourism resources at locations such as Gwangjang Market, Deobukhan Mountain, and Deochuncheon. In Seoul, it sells 'Seoul Sunset Omija Fizz' and 'Seoul Makgeolli Cold Brew,' while also featuring unique menu items in Chuncheon and Bukhan Mountain to encourage visits. Paris Baguette is selling a dedicated bakery at its Jeju Songdang Donghwa Village location, featuring items like Omegi Rice Cake and Jeju matcha. Following positive feedback from a trial run, Nolrang Tongdak expanded its 'Udo Peanut Chicken' to a nationwide menu this year.
Collaborative projects aimed at increasing the consumption of local agricultural products are also on the rise. CJ Freshway plans to launch the 'Taste of Coexistence' campaign in 2024, utilizing local produce in group meals and ready-to-eat menus. This includes dishes like watermelon cold noodles made from watermelons from Buyeo, potato kalguksu using potatoes from Seosan, and sweet potato sandwiches and lattes from Dangjin. This year, it has partnered with Gochang County to purchase approximately 70 tons of Gochang watermelon, selling watermelon juice and fruit punch in group meals and company cafes. To date, the campaign has procured 1,640 tons of local agricultural products.
Pulmuone Food & Culture has partnered with Jeollanam-do and Wando-gun to sell dishes featuring Wando abalone at 16 highway rest areas nationwide. Menu items include 'Wando Abalone Pork Bone Soup,' 'Wando Abalone Soft Tofu Stew,' and 'Wando Abalone Fish Cake Udon,' with Wando abalone also available for direct sale at rest areas. Tasting events and discounts are being held to broaden consumer engagement.
Some companies are leveraging local specialties as a brand strength. Ottogi has launched 'Ottogi Rice Miso Jinpum,' using the representative rice variety from Sangju and Yecheon in Gyeongbuk, emphasizing ingredient differentiation in its product name. Ediya Coffee has signed a partnership with Bonghwa County to ensure a stable supply of Bonghwa watermelons. Plans are in place to develop products using not only watermelons but also apples and other Bonghwa agricultural products, along with joint marketing efforts. Banolim Pizza has introduced a limited-time pizza featuring Gochang pungcheon eel.
The consumer demand for loconomy food is already established. A survey by Embrain Trend Monitor of 1,000 adults found that 81.0% of respondents have purchased loconomy food, with 83.5% expressing a strong intent to buy in the future. Consumers view purchasing loconomy food as a form of 'value consumption' that contributes to local economic revitalization and coexistence (61.9%). Notably, older consumers in their 40s and 50s tend to trust the quality associated with domestic ingredients, perceiving them as 'safe and healthy food' (71.6% among those in their 50s).
However, price remains a concern. About 74.0% of respondents expressed worries about rising prices for loconomy food made with domestic ingredients, and 61.6% indicated that these products are more expensive than regular items. There are also skeptical views that loconomy food may end up being a one-time experience (59.2% agreement) or a fleeting trend reliant on social media popularity (50.1%).
Lee Eun-hee, a professor of consumer studies at Inha University, stated, 'Loconomy is significant as it secures stable distribution channels for local agricultural products and helps companies build a positive image of coexistence with the local economy. To avoid one-time marketing, local governments and businesses must collaborate to manage the timing, quantity, and pricing of agricultural products and maintain a system for joint promotion.'
* This article has been translated by AI.
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