[INVESTIGATION] South Korea: Why the country will be such a magnet for luxury goods in 2023 (Part 2/5)

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As one of the world’s biggest consumers of luxury goods, South Korea is attracting a great deal of interest from brands in the sector. Behind the high-profile fashion shows and events, the luxury brands are also seeking to gain a more lasting foothold in the Land of the Morning Calm.

 

This strategy involves strengthening their distribution channels, whether directly-operated shops or local department stores (Lotte, Shinsegae, etc.).

 

The continuation of our investigation into South Korea continues in the capital, Seoul, which for the last ten years has been home to some of the finest Western luxury flagships, not to say the largest in Asia.

 

A historic market revived

 

It was at the end of the 1990s – and especially in the early 2000s – that luxury brands developed a passion for China, complementing their distribution in Japan, which began in the late 1970s and was strengthened in the 1980s.

 

However, some luxury brands were pioneers in the Korean market, such as Louis Vuitton and Gucci. The French luxury brand opened its very first boutique in Seoul in 1991, and the Italian brand in 1998.

 

While retail penetration of the market already took place towards the end of the 2010s, 2023 marks a renewal of interest, both economic and cultural, on the part of European luxury brands for the southern part of this country split in two.

 

South Korea has benefited from the slowdown in the Chinese market following the pandemic, as well as from an increase in consumption by Chinese customers in both their domestic market and neighbouring countries. Add to this a growing awareness on the part of luxury brands of the need to reduce their dependence on China, where, before the pandemic, a third of luxury product sales were made by the population, with two-thirds of these purchases being made outside the country.

 

Dior flagship in Seoul’s Seongsu Dong district, inaugurated in 2015 © Christian de Portzamparc

 

It was not until 2022 that Hermès opened its first Korean outlet in Pangyo – a high-tech hub, the equivalent of Shenzhen in China – while Dior chose Korea to open its largest flagship store in Asia in the second half of 2023, again in the Hyundai department store.

 

LVMH’s flagship brand had already opened its largest flagship store in Seoul, in the Seongsu-Dong district, in 2015.

 

Korea is a priority market for the LVMH group. Louis Vuitton has 34 points of sale in the country, including a flagship designed by architect Frank Gehry, due to open in 2019.

 

Louis Vuitton Flagship to be inaugurated in 2019, located in Cheongdam-dong, Gangnam, in Seoul’s upmarket district. Louis Vuitton

 

In fact, at the end of March, CEO Bernard Arnault made his first trip to the country in three and a half years, before visiting China. The purpose of the visit was to forge privileged partnerships with the main local luxury department stores’ chains, such as Lotte, Shinsegae and Hyundai, not forgetting Hotel Shilla.

 

The other advantage that has finally convinced major groups and brands to dilute their risks on the Asian market by stepping up their distribution in Korea is a more favourable relationship with luxury than in neighbouring China, as Thomas Sommer points out. The CEO of SG Entertainment, a Seoul-based entertainment company specialising in the production of content and kpop groups, cites a Bain study which shows that only 20% of people in the Land of the Morning Calm have a negative opinion of luxury, compared with 40% in China.

 

Read also > The Old Continent: the top summer destination for non-Europeans – Luxus Plus (luxus-plus.com)

 

Featured photo : Seoul Dior flagship store interior © Dior [/vc_column_text][/vc_column][/vc_row][vc_row njt-role=”not-logged-in”][vc_column][vc_column_text]

As one of the world’s biggest consumers of luxury goods, South Korea is attracting a great deal of interest from brands in the sector. Behind the high-profile fashion shows and events, the luxury brands are also seeking to gain a more lasting foothold in the Land of the Morning Calm.

 

This strategy involves strengthening their distribution channels, whether directly-operated shops or local department stores (Lotte, Shinsegae, etc.).

 

The continuation of our investigation into South Korea continues in the capital, Seoul, which for the last ten years has been home to some of the finest Western luxury flagships, not to say the largest in Asia.

A historic market revived

 

It was at the end of the 1990s – and especially in the early 2000s – that luxury brands developed a passion for China, complementing their distribution in Japan, which began in the late 1970s and was strengthened in the 1980s.

 

However, some luxury brands were pioneers in the Korean market, such as Louis Vuitton and Gucci. The French luxury brand opened its very first boutique in Seoul in 1991, and the Italian brand in 1998.

 

While retail penetration of the market already took place towards the end of the 2010s, 2023 marks a renewal of interest, both economic and cultural, on the part of European luxury brands for the southern part of this country split in two.

 

 

 

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[/vc_cta][vc_column_text]Featured photo : Seoul Dior flagship store © Dior[/vc_column_text][/vc_column][/vc_row][vc_row njt-role=”people-in-the-roles” njt-role-user-roles=”subscriber,customer”][vc_column][vc_column_text]

As one of the world’s biggest consumers of luxury goods, South Korea is attracting a great deal of interest from brands in the sector. Behind the high-profile fashion shows and events, the luxury brands are also seeking to gain a more lasting foothold in the Land of the Morning Calm.

 

This strategy involves strengthening their distribution channels, whether directly-operated shops or local department stores (Lotte, Shinsegae, etc.).

 

The continuation of our investigation into South Korea continues in the capital, Seoul, which for the last ten years has been home to some of the finest Western luxury flagships, not to say the largest in Asia.

 

A historic market revived

 

It was at the end of the 1990s – and especially in the early 2000s – that luxury brands developed a passion for China, complementing their distribution in Japan, which began in the late 1970s and was strengthened in the 1980s.

 

However, some luxury brands were pioneers in the Korean market, such as Louis Vuitton and Gucci. The French luxury brand opened its very first boutique in Seoul in 1991, and the Italian brand in 1998.

 

While retail penetration of the market already took place towards the end of the 2010s, 2023 marks a renewal of interest, both economic and cultural, on the part of European luxury brands for the southern part of this country split in two.

 

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[/vc_cta][vc_column_text]Featured photo : Seoul Dior flagship store © Dior [/vc_column_text][/vc_column][/vc_row]

Victor Gosselin
Victor Gosselin
Victor Gosselin is a journalist specializing in luxury, HR, tech, retail, and editorial consulting. A graduate of EIML Paris, he has been working in the luxury industry for 9 years. Fond of fashion, Asia, history, and long format, this ex-Welcome To The Jungle and Time To Disrupt likes to analyze the news from a sociological and cultural angle.

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