Nina Jobst
Research expert covering South Korea
Department stores in South Korea - statistics & facts
Department stores have propelled the retail sector in South Korea and set the tone in the market since the 1980s. While there is a discussion about the end of the department store era, they still play a significant role in South Korea to this day. Among offline retailers, they account for the largest share in retail sales. However, they do need to shed their outdated image to keep up with modern consumer demands.
The history of department stores in South Korea
While the first department stores in South Korea were opened in the 1930s, they rose in popularity in the 1980s as the standard of living improved under the influence of South Korea’s stellar economic growth, called the “Miracle on the Han River”. Since then, Lotte Department Store, Shinsegae Department Store, and Hyundai Department Store have remained the key players in the field. With such a long-standing history, the image of department stores has changed in public perception. To appeal to the modern customer base, department stores have begun to include a larger variety of businesses.Deluxe shopping experience
Naturally, South Korean department stores offer a variety of retail products in different price ranges. Matching the high-quality image compared to other retail channels, luxury goods sales make up the highest sales share. Aside from food, clothing, and household item shopping, department stores offer a multitude of leisure activities. These include attached hotel businesses, and recreational activities, such as concert halls and cinemas, and most famously an amusement park in the middle of Seoul. The latest trend is the opening of pop-up stores, which are refreshing for the existing customer base and attract new customers at the same time.A promising future for South Korea’s department stores
While most consumers engage in online shopping, department stores are still a major segment of the South Korean retail market. Customers appreciate being able to view products in person and think of department store goods as high quality. At the same time, businesses encourage customer loyalty with intensive customer service, membership benefits, and diversified activities. Department stores seek to re-invent themselves and are expected to still experience growth, compared to other offline retailers.
