TOP 10 OPERATORS 2018 4: SHILLA DUTY FREE
“This channel will become even bigger since many young and new entry customers are online and mobile natives. Buying online is a breath of fresh air to them and they expect the same in travel retail too.” English is the most widely accepted
and spoken language on the planet, with 1.5 billion of the world’s 7.5 billion inhabitants speaking it. This equates to 20% of the population. Offering an online shopping
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service in English unlocks a ‘great potential’ market for Shilla. Even though Chinese customers are the biggest spenders in South Korean duty free and Shilla’s Chinese online duty free shopping service is on track, there are still many unfilled gaps when it comes to online services supporting different nationalities. The Spokesman explains: “The
Shilla Duty Free previously offered online shopping in Korean, Japanese and Chinese, but these languages are uniquely spoken by each nationality and are difficult to be considered universal. “Opening an English online
shopping service grants access to a wider customer base including Southeast Asia, Middle East, Europe and America. “The Shilla Duty Free looks
forward to widening its customer base in terms of nationality. The English service will play a great role in that.”
Chinese tourism revival? While the general consensus is that the political situation limiting the number of Chinese tourists visiting South Korea is easing, things are yet to return to normal. According to figures from the
Korea Tourism Organization (KTO), Chinese arrivals to Korea rose 60.9% to 366,604 in April; +46.1% to 370,222 in May; +49% to 379,891 in June; and +45.9% to 410,337 in July. But the fact remains many corners
of the Korean DF&TR market are still being affected. This is despite Korean President Moon Jae-in’s official office confirming normal relations were to be restored between South Korea and China back in November 2017 following the summit meeting with Chinese President Xi Jinping in Da Nang, Vietnam.
OCTOBER 2018
The opening of the Terminal 4 store at Singapore Changi Airport helped The Shilla Duty Free stabilise its entire operation at the airport.
The Spokesman remarks: “Group
tourism has been impacted the most and conventional group tourism hasn’t fully returned. The impact this has had on Korean travel retailers is well documented in many reports. “No operator has been unaffected,
especially when we take into account the previous contribution of Chinese group tourists to the South Korean travel retail industry.” The situation, however, is
gradually recovering, with the aforementioned Chinese visitor numbers to South Korea painting a positive picture. “The Shilla Duty Free witnessed a record-breaking performance for two consecutive quarters in 2018. Chinese and South Korean customers were the main contributors.” It is no surprise, therefore, that
Chinese consumers are Shilla’s top- spending nationality. “Despite the turbulent situation,
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the importance of Chinese customers for Shilla and the South Korean duty free market in general remains high,” explains the Spokesman.
Contact:
janice@trbusiness.com
Greatest Challenge Its greatest challenge, however, will continue to come from customers in general. Changes in preference, behaviour and demographics will be the most decisive variable for the industry and for Shilla, according to the Spokesman. Such changes are already
strategic
happening fast, but will likely do so even faster, especially in Asia Pacific where most of Shilla’s business is. “Customers in the Asia Pacific
region are IT natives,” the Spokesman says: “New technologies penetrate and widely in this region. They are sensitive and quickly adapt to fads and trends. “Such characteristics act swiftly
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in terms of shifting preferences. As a matter of fact, Shilla’s major target customers are hard to catch up with and keep demanding new things. “Satisfying
ever-changing
customers is the greatest challenge facing The Shilla Duty Free in the coming years.” One element, however, which
remains constant is the importance of the beauty category that is unchallenged as the top selling product category. “Within the beauty category,
skincare and make-up are the major pillars. The category’s leadership is observed throughout all The Shilla Duty Free’s retail doors and bares
importance
across the whole business,” the Spokesman concludes. «
“The Shilla Duty Free managed outstanding business in the second quarter and first half of 2018. It’s a thrilling performance and the company is pretty confident with the result.”
Shilla Duty Free Spokesman TOP 10 OPERATORS 35
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