SOUTH KOREA REPORT: HANWHA GALLERIA DF
affluent Gangnam district. Tapping into the parent company’s
expertise in luxury retailing, Galleria Duty Free has created an upscale luxurious shopping environment at the base of the Daehan 63 skyscraper. “We want to offer a department
store feeling,” added Ahn. “We have two ground floor entrances; one from the Daehan 63 Building and the other from the main lobby. Our whole shop is 10,072sq m and the ground floor is the biggest retail area.” Perfume and cosmetics, fashion
boutiques and electronics are located on the ground floor, while luxury watches and jewellery are located on the first floor. Fashion accessories and Korean
products including cosmetics and fashion are located on floors two and three.
Changing visitor preference “We are increasing our brands; currently we have our own exclusive brands as well,” said Ahn. “We are the first in the duty free market here to house exclusive brands from around the world such as Stefano Ricci men’s suits, Golden Goose fashion and shoes from Italy, Corneliani fashion, and Launer London bags.” In addition to Galleria’s four
exclusive brand boutiques which opened in autumn 2016, luxury boutiques from Bottega Veneta, Gucci and St Laurent opened in the downtown store in the second half of last year. Interestingly, Ahn told TRBusiness
that foreign visitor’s shopping preferences have changed over the course of the last 18 months since Galleria Duty Free opened its Daehan 63 shop. Customers are now looking for
more than just luxury brands in Seoul’s downtown duty free stores. In order to cater to the changing composition of foreign and local customers visiting the store, Ahn said that Galleria is now introducing some contemporary South Korean labels in order to diversify its brand mix. “In the beginning we were a
newcomer to duty free and tried to bring in luxury brands, but it’s very difficult to get top line
MAY 2017
May 2017 20
YEARS 1997-2017
Heinemann hits $4bn in group turnover in 2016
brands,” revealed Ahn. “We are still negotiating with some. “Also, we realised that younger millennial visitors are coming to Seoul as they like South Korean culture. They want Korean brands instead of traditional international brands. “So instead of focusing just on
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international brands which we continue to display, to boost our sales we have to find what young people want.” Two years ago, group tours
Also inside
visiting South Korea were still largely composed of older visitors looking for luxury brands and watch boutiques. Since 2016, visitor numbers to
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Seoul have rebounded following the MERS crisis over the summer of 2015 and the number of younger foreigners under 30 visiting Galleria’s downtown store have grown. In correlation with this, there has been a noticeable shift in purchase preference towards South Korean cosmetics and fashion items.
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More Korean brands... Naturally, Galleria Duty Free has responded by adding more South Korean brand items. “We carry Galleria’s own ‘G
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Street 101’ designer shop collection on the second floor where it showcases a selection of new South Korean fashion brands and young designers,” said Ahn. “These are for young people under 30 years old. “Many of the labels are famous
among foreign visitors, such as those from China, Taiwan and Thailand as they are also popular with K-wave entertainment personalities.” Of course, ginseng and
by the Chinese government’s recent ban on group tours to South Korea in protest over the Seoul administration’s decision to deploy the United States’ THAAD missile system, Galleria Duty Free is switching its strategy to target other foreign visitor groups and more affluent FIT travellers. To put the importance of group
tours into perspective, Ahn said that these customers accounted for 80% of Galleria Duty Free’s sales in 2016, while foreign FIT and South Korean customers represented the remaining 20% share.
“We also cooperate with South Korean hospitals doing medical check-up tourism visits and they introduce us to their clients.”
Hyunah Ahn, Galleria Duty Free TRBUSINESS 127
very recently group tours accounted for the majority of Galleria Duty Free’s downtown sales, of which most were Chinese. However, with numbers impacted
TRBusiness Annual South Korea Report
Electronics are located on the ground floor of the Daehan 63 building in Seoul. Hong Seok Ho
electronics also remain popular with foreigners and locals. “We have ginseng and electronics products such as laptop computers and high-end rice cookers priced over US$100 each,” added Ahn. “Also, lots of kids items like toys, shampoo, toothpaste and other products.” Other recent additions to Galleria’s
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LAGARDÈRE IN ROME | ACI CONFERENCES’ REVIEW | LOTTE DUTY FREE | DFS GROUP SHILLA | SUNRISE | EVER RICH | CHANGI AIRPORT | SINGAPORE CRUISE CENTRE | CHINA DUTY FREE | INCHEON AIRPORT | HDC SHILLA | HANWHA GALLERIA | SM DUTY FREE WILLIAM GRANT & SONS | PERNOD RICARD | BROWN-FORMAN | BEAM SUNTORY | BACARDI BEAUTY IN ASIA REPORT | COTY’S PHILIPPE MARGUERITTE | PEOPLE NEWS | NOW & THEN
growing merchandise range include the Rifa of Japan collection of manual and battery-driven skin beauty appliances. “We have also introduced MLB
baseball caps that have recently become a hot item,” said Ahn. She also tells TRBusiness that until
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