SOUTH KOREA: HYUNDAI DUTY FREE
ongoing, bringing in top tier luxury brands,” says Yuk. “Our eighth floor has a 3.5-metre
ceiling height. Luxury brands are enhanced by high ceilings; they can express their image better.” Since the shop opened, this floor in
particular has been filling up as more luxury brands complete. Burberry opened a boutique in
mid-November followed by other brands including Bottega Veneta, Omega and Blancpain. Recent arrivals include Moncler,
which opened on 21 February, while Prada was scheduled to open its boutique in late April [correct at the time of writing]. Furthermore, Cartier will open
in July and Celine in September at which point the spaces will be filled. Thereafter, Hyundai Duty Free will likely target three or four more high- end suppliers.
Beauty a priority Yuk explains: “We are not fully satisfied with our layout – customers want top-tier brands, so we are working to satisfy those needs.” Smaller brands are entering the
luxury collection as well. Recent arrivals include French fashion and jewellery brand Clio Blue and Les Néréides, another French jewellery brand. The perfume and cosmetics
collection is also being expanded to deliver first-to-shop names. “We are looking for more beauty
brands – we want to develop more,” expresses Yuk. “We need five or six more major beauty brands. We are negotiating with them now.” Le Labo opened a counter in
January alongside Victoria’s Secret Beauty, while Hourglass started in February. “Small beauty brands are opening
on our ninth floor but our focus is major brands,” Yuk confirms. “We already have L’Oréal and Estée Lauder, also 100% of domestic South Korean brands.” Perfume and cosmetics account
for 70% of Hyundai Duty Free’s total sales followed by luxury fashion, watches and jewellery, which together represent a further 25% share of sales – mostly watches and handbags.
MAY 2019
Omega is the top-selling watch brand followed by Tudor, Tag Heuer, Longines, IWC and Jaeger Le-Coultre. “Perfume and cosmetics sales
are up and down a little, but 70% is average,” says Yuk. “Imported brands are 50% to
60% of sales while Korean brands are 50% to 60%, that’s the average. Our target is more international brand sales.” Gucci is Hyundai Duty Free’s
top-selling luxury fashion brand alongside Burberry, Bottega Veneta and Alexander McQueen handbags and sneakers. “Sneakers are a new item – South
Koreans and Chinese have been buying them recently,” notes Yuk.
Online sales climbing Meanwhile, online sales have developed quickly since the store’s opening, reflecting the general growth in online duty free shopping registered by other South Korean travel retailers. “Our online sales platform
recorded 30% of our total monthly sales in February,” says Yuk. “Maybe it will go up gradually. “South Korean and Chinese
customers are each 50% of online sales. Our online service is in Korean, Chinese and English; we are planning a Japanese language service in the future.” In addition to brands that are
available online and in the Hyundai Duty Free downtown store, the company is expanding its collection
Gucci is Hyundai Duty Free’s top-selling luxury fashion brand alongside Burberry, Bottega Veneta and Alexander McQueen handbags and sneakers.
TRBusiness
of online-only duty free products. “We have designer label brands
online that are not displayed in our shop,” comments Yuk. “These are mostly minor brands that because of volumes and the company size cannot operate in our offline store. “There are about 200 branded
goods items that are only available online. These include cosmetics, fashion accessories and fashion brands, both local and imported products.” Meanwhile, Hyundai Duty
Free is looking to expand its store membership programme as the company’s data shows its members, some of whom live overseas, are the store’s core customer group. According to Yuk, Hyundai Duty
Free has about 700,000 members of whom about 500,000 live in South Korea while the remaining 200,000 (about 30%) live overseas. “Members are a tremendous asset
to the shop,” describes Yuk. “Our sales are driven by members; we are adding 10,000 a day. “You have to become a member
to purchase online, but offline sales are also driven by members as to get promotion benefits, you have to sign up as a member.” «
Above: The 14,200sq m Hyundai Department Store Duty Free is located on floors eight, nine and 10 in Hyundai Department Store’s COEX branch.
International visitors, 90% of which are Chinese, account for 80% of Hyundai Duty Free’s Sales. TRBUSINESS 95
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