SOUTH KOREA: THE SHILLA DUTY FREE


Airport shop operations continue to be heavily affected by international flight cancellations and reduced international passenger numbers.


TRBusiness


KRW1.3tn/$1.1bn (+18.2% yoy). As part of efforts to satisfy


customers’ demands for the latest brands and products, Shilla recently added a number of new beauty and street fashion brands to the Seoul flagship store collection. “In the perfume and cosmetics


is not understood to have shut [correct at the time of writing – Ed]. “Covid-19 has affected airport


traffic across the whole world due to weak travel demand and flight bans,” continues Kim. “Given the current situation the reduction in sales is unavoidable for the time being. “However, this doesn’t mean


that duty free demand decreases; once Covid-19 eases, sales growth is expected to show a quick recovery.” South Korea’s tourist industry


and Shilla’s current operations are weathering Covid-19. This contrasts sharply with the bright picture at the start of 2020 when the company had just concluded another year of record-breaking sales.


Record 2019 sales of $7.8bn The Shilla Duty Free recorded total net sales of KRW9.1 trillion/$7.8 billion (+30.7%) in 2019 [figures based on KRW-US dollar average exchange rates – Ed], which it attributes to ‘sophisticated customer analysis and bespoke management’. Domestic net sales reached (+39.7% yoy)


KRW6.5tn/$5.6bn


while overseas net sales totalled KRW1.3tn/$1.1bn (+6.5% yoy). Sales from the Shilla iPark joint venture climbed to


category we have added several new cosmetics lines from traditional luxury and niche perfume brands,” explains Kim. “Among international cosmetics


brands we have mainly launched new cosmetics from luxury brands such as Christian Louboutin, Gucci cosmetics, Burberry cosmetics and Fenty Beauty. “We have added niche perfume


brands such as Kilian, Maison Margiela and Loewe perfume. “Among Korean cosmetics we


have new promising brands like Dancing Whale and Acwell.” Shilla’s top selling international


beauty brands in 2019 were Dior, Estée Lauder, La Mer, Lancôme and SK-II. The most popular Korean


cosmetics brands last year were: A.H.C., Dr.Jart, Laneige, Sulwhasoo and Whoo. “Perfume and cosmetics hold


a dominant position in our sales mix,” says Kim. “Korean cosmetics brands, Korean fashion brands and confectionery items are also gaining popularity.” Special


invitation events


showcasing selected international perfume and cosmetics brands are another feature of Shilla’s


premium beauty products promotion programme. Turning to fashion brands, Kim


notes that Shilla already offers customers a large collection of luxury brands at its Seoul flagship store. The top-selling luxury fashion


brands in 2019 were Chanel, Gucci, Hermès, Louis Vuitton and MCM. The most popular watches and


jewellery brands were Bulgari, Cartier, Longines, Rolex and Tiffany & Co. Recent street fashion brand


additions to the shop include Acme De La Vie, Stereo Vinyls and Boy London.


Cosmetics still on top South Korean products remain an important category in the Seoul flagship store and are displayed mostly on the basement floor level. “Korean cosmetics keep leading


the sales among our South Korean products,” confirms Kim. “K-fashion brands such as


bags, garments, sunglasses and accessories have also been gaining popularity recently. “Our Shilla Duty Free


merchandising team are trying to find new, promising brands in line with customer changes in shopping trends.” Elsewhere, Shilla has re-organised


its four floor Jeju Island downtown store after work to extend the shop was completed in 2019. The company has converted an


unused area on the fourth floor into a single K-cosmetics zone featuring Korean cosmetics brands that were previously displayed on the second and third floors. The extension has increased the


store’s total retail display area by about 10% and allowed more fashion and international beauty products to be presented in positions previously occupied by Korean cosmetics. “We revamped the first floor


luxury watches and jewellery floor to upgrade the shopping environment,” says Kim. “The second floor is for fashion


Mixed category shops at Jeju Airport were closed in March. 64 TRBUSINESS


brands. We have added a ‘Street Fashion Zone’ there. Our third floor displays international cosmetics brands and niche perfume brands. The fourth floor is for Korean


MAY 2020


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