One To Watch: CJ Group Fast Becoming Another South Korean Brand Popular With US Consumers

For decades, American consumers have built a strong affinity for South Korean brands — Samsung, Hyundai, LG and Kia, just to name a few. Today, we're watching the impact of another familiar Korean company: CJ Group and its U.S. division, CJ America, as it invests and expands its presence in entertainment, retail, logistics and biotechnology. It's a growth story worth watching.

CJ Group's roots go back 70 years in Korea when it began as CheilJedang, a sugar and flour milling company in South Korea that was a subsidiary of Samsung Corp. (CheilJedang translates to "best sugar company.") Over the years, it expanded beyond food products to include investments in movie theaters and television production, shipping and logistics, agriculture and biotechnologies and retail. The goal was simple: spread K-food and K-culture throughout the world and globalize the company's best-in-class innovation capabilities. In 1993, CJ Group was spun off from Samsung and has become a $30 billion multinational conglomerate.

Today, American consumers likely interact with some element of CJ's portfolio of brands and products in their daily lives. Whether it's in the frozen section of the grocery store, receiving a package at home, enjoying a popular Netflix show, consuming fresh meat grown on an American farm or watching the CJ Cup PGA Tour event, CJ America and its affiliates are central to the U.S. economy and lifestyle.

One of CJ's most transformational moves in the U.S. food industry came in 2019 with its acquisition of Schwan's Company. In combination with its existing U.S. business, Schwan's has helped grow CJ's presence in U.S. grocery stores with popular brands such as Red Baron and Tony's pizza, Pagoda Asian snacks, Edwards desserts, Mrs. Smith's pies and CJ's flagship Korean brand Bibigo. With Schwan's, CJ now has a significant scale in the grocery industry, which has led to accelerated growth in these brands. Last year, Red Baron pizza became one of only eight frozen brands to surpass $1 billion in sales. Growth is also fueled by CJ's investments, including the recent completion of a manufacturing expansion to create the world's largest frozen pizza factory in Salina, Kansas. Adding to its presence in the American food scene, CJ's Foodville USA continues to expand its TOUS les JOURS French-Asian bakery franchise, which now has nearly 100 U.S. stores.

CJ has always prioritized innovation and research and development, and CJ America affiliates benefit from the capabilities of the company's Blossom Park R&D facility in Seoul. This massive campus is Korea's largest food and bio-convergence research institute and was recognized in 2018 as the Lab of the Year by R&D Magazine. Recently, CJ's Food & Nutrition Tech (CJ FNT) was launched to support the development of next-generation "clean label" food ingredients, including those that are additive-free, non-GMO, non-allergenic and natural. Last year, CJ FNT signed an exclusive agreement establishing a partnership with Emmyon, Inc., a U.S.-based biotechnology startup that is focused on supporting the growing global nutrition market.

Leveraging its research might, CJ Biomaterials has created a fully degradable plant-based bioplastic, called PHACT, that can help reduce pollution by taking the place of single-use plastics in applications from lipstick containers to food containers.

CJ is also committed to supporting American farmers with cutting-edge livestock feed products. Under its CJ BIO business, the company produces amino acid ingredients for use in animal diets, helping to ensure U.S. food security.

American TV and movie viewers have enjoyed content produced by CJ's entertainment affiliate, CJ ENM. CJ ENM produced the multi-Oscar-winning 2019 film "Parasite," and the hit Netflix shows "The Glory" and "Crash Landing on You." Though a well-known powerhouse in Hollywood, many Academy Awards viewers met CJ Vice Chairwoman Miky Lee thanks to her charming acceptance speech for "Parasite."

Since 2012, CJ has also exported K-culture globally through KCON, the industry's biggest annual Korean culture event, where Korean pop superstars BTS made their U.S. debut. Last year, CJ ENM further expanded its influence in entertainment with its acquisition of Endeavor Content TV and movie studio (recently renamed Fifth Season), which produces the hit TV series "Severance."

CJ is also helping to support the American supply chain and logistics markets and deepening connections with a global network that moves products around the world. Based outside of Chicago, CJ Logistics serves as a critical bridge to global shipping and over-the-road transport services. Recently, the company signed a $457 million deal with South Korea's Korea Ocean Business Corporation, a South Korean government entity, to create large-scale logistics centers in the U.S. that will help South Korean businesses move products between the two countries more efficiently.

Since entering the U.S. market, CJ has invested more than $5 billion in America. Its businesses operating in the U.S. employ more than 13,000 workers. This commitment and investment in growing CJ's presence in the U.S. is guided by the leadership of CJ Group Chairman Lee Jay-hyun, who has outlined a bold vision for CJ to become a leading global lifestyle company, focused on four areas: culture, sustainability, lifestyle and wellness. In total, CJ is planning to invest more than $7.8 billion to grow its business worldwide, including a $3.4 billion investment in artificial intelligence, big data and technologies.

The U.S. will remain a priority market for CJ Group to fulfill this vision. CJ will continue to invest significantly to capitalize on the accelerating popularity of K-food among American consumers. Already, CJ's Bibigo brand has become well-known among consumers as Korean food moves out of niche ethnic categories into mainstream "Asian destinations" at grocery stores. And Bibigo's strong partnership with the Los Angeles Lakers doesn't hurt the brand's visibility, either.

From its 1978 entry into the U.S. market, CJ America has grown to make its presence felt in daily consumer life here, through a variety of well-liked products and popular entertainment content. CJ may become the next brand out of South Korea to become an American household name.

Frank Ahrens is a former head of global corporate communications for Hyundai Motor and the author of "Seoul Man: A Memoir of Cars, Culture, Crisis, and Unexpected Hilarity Inside a Korean Corporate Titan."