SOUTH KOREA: SHINSEGAE DUTY FREE
display of Guess, Briston, Olivia Burton and Triwa watches. These moved into an adjacent shop at the expense of South Korean female apparel brands Voice of Voices and G-Cut. Next to join the Gangnam store’s
portfolio was Moncler which opened its first-floor boutique at the beginning of March. At the time of writing, two more
luxury fashion brands were due to enter the Gangnam store in April. Burberry and Salvatore Ferragamo were also scheduled to open first-floor brand boutiques around 25 April. Watches & jewellery brands add
to the luxury goods mix in Gangnam with Jaeger leCoultre, TAG Heuer, IWC and Breguet among the top- selling watch brands there. Hong tells TRBusiness that South
Korean customers are comfortable spending between $2,000 to $3,000 on high-end timepieces and from $200 to $300 on fashion watches. Chinese customers, however, are
willing to spend more like $5,000 to $10,000 on a watch, depending on the brand and design.
P&C leads other categories The perfume and cosmetics category currently accounts for a high proportion of sales in Shinsegae’s Gangnam shop, with South Korean skincare brands actually making up more than half of total sales. The History of Whoo from LG
Household and Health Care and Sulwhasoo from Amore Pacific are the top two local beauty brands for Shinsegae and SK-II, Estée Lauder, YSL and Christian Dior are the top international labels. Chinese free independent
travellers (FITs) account for a majority of beauty sales, with cosmetics growing in popularity over other beauty segments. Cosmetics account for almost 50%
of sales in the flagship Shinsegae Myeongdong downtown store. Aside from beauty, fashion is
also a high-performing category for Shinsegae. But sales of fashion items represent a greater share of the business in Myeongdong than in Gangnam. However, this could be because fashion brands are still
MAY 2019
An eye-catching activation at Shinsegae’s Myeongdong store.
being added. “A Hermès boutique is scheduled
to open on the eighth floor of our Myeongdong store in Q4 this year,” reveals Hong. “It will have the highest number
of luxury fashion brands among the main stores in the duty free business. “Cosmetics continue to account
for a large share of sales and maintain a high sales increase. This is due to strong performances from brands such as SK-II, YSL and Estée Lauder. “Changes, however, can be seen
in Korean product preference. This includes K-fashion items such as MLB baseball caps, Nerdy and Find Kapoor and baby products such as baby bottles.” On the airport front, Shinsegae
took over three separate licenses (DF1, DF5 and DF8) in Incheon Airport Terminal 1 and the T1 concourse last summer. The three licenses cover luxury
boutiques, perfume and cosmetics shops and various duty free outlets previously operated by Lotte Duty Free. “Our new T1 business licenses
started on 1 August 2018,” says Hong. “Sales in the new shops have increased by about 15% compared to the previous operator.” In Seoul Incheon Terminal 2
Shinsegae opened a new Hermès boutique on 1 October 2018 and an IWC watches boutique in March 2019. A new Omega boutique was also scheduled to open last month. Hong comments: “Our T2 sales have increased since opening by
“Our T2 sales have increased since opening by 11% from $15m in the first three months to $17m in the latest three-month period.”
Hong Seok Ho, Shinsegae Duty Free Merchandising Division
11% from $15m in the first three months to $17m in the latest three- month period.” While Chinese visitors remain
Shinsegae’s largest customer group, the retailer has noticed a growth in purchases from South Korean customers over the past year. “Chinese customers consistently
account for more than 70% of sales, but at Shinsegae Duty Free, the sales ratio among Koreans has rapidly increased since we acquired the T1 cosmetics stores,” says Hong. “This is because they prefer the
brands. The South Korean customer mix has increased +4% this year compared to 2018.” «
In 2018 Shinsegae opened this new store at Incheon International Airport’s Terminal 1.
TRBUSINESS 89
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60 |
Page 61 |
Page 62 |
Page 63 |
Page 64 |
Page 65 |
Page 66 |
Page 67 |
Page 68 |
Page 69 |
Page 70 |
Page 71 |
Page 72 |
Page 73 |
Page 74 |
Page 75 |
Page 76 |
Page 77 |
Page 78 |
Page 79 |
Page 80 |
Page 81 |
Page 82 |
Page 83 |
Page 84 |
Page 85 |
Page 86 |
Page 87 |
Page 88 |
Page 89 |
Page 90 |
Page 91 |
Page 92 |
Page 93 |
Page 94 |
Page 95 |
Page 96 |
Page 97 |
Page 98 |
Page 99 |
Page 100 |
Page 101 |
Page 102 |
Page 103 |
Page 104 |
Page 105 |
Page 106 |
Page 107 |
Page 108 |
Page 109 |
Page 110 |
Page 111 |
Page 112 |
Page 113 |
Page 114 |
Page 115 |
Page 116 |
Page 117 |
Page 118 |
Page 119 |
Page 120 |
Page 121 |
Page 122 |
Page 123 |
Page 124 |
Page 125 |
Page 126 |
Page 127 |
Page 128 |
Page 129 |
Page 130 |
Page 131 |
Page 132 |
Page 133 |
Page 134 |
Page 135 |
Page 136 |
Page 137 |
Page 138 |
Page 139 |
Page 140 |
Page 141 |
Page 142 |
Page 143 |
Page 144 |
Page 145 |
Page 146 |
Page 147 |
Page 148 |
Page 149 |
Page 150
