Luxury Brands Focusing On South Korea
Clothing brands cover specific niches. There are more utilitarian brands like NUMI, and more luxurious brands like Louis Vuitton, which cater to specific demographics. South Korea’s consumers are known for their love of luxurious brands, which, in turn, has made it the focus of such brands.
South Korea’s luxury goods market was valued at 14.2tn won/US$12.1bn in 2018, up from 2014’s 11.46tn won, and according to data from market research firm Euromonitor International. It’s also the world’s fourth fastest-growing luxury market, behind only India, Malaysia, and Indonesia.
Data from the industry reinforced that, saying that the sale of major luxury brands in South Korea went up by 20-30% in 2018. In contrast, the country’s local department stores only grew by 2%, showing a disparity between luxury brands and purchases, with brands like NUMI and grocery stores; more utilitarian brands.
Specifically, South Korea’s luxury handbag market had a total value of 3.2tn won in 2017, which makes it the fourth-largest market for the industry behind US, China, and Japan. It even managed to outdo France itself, the home country of international luxury brands like Louis Vuitton and Chanel.
In response, these luxury brands are moving into the country, hoping to capitalize and profit off of the growing market.
Louis Vuitton, in particular, recently opened their South Korean flagship store in Seoul late in October, located in Gangam’s high-end Cheongdam neighborhood. LVMH Chairman Bernard Arnault was present at the store’s opening ceremony during his third visit to the country in as many years.
On top of that, Louis Vuitton also opened a pop-up store specifically for their signature Twist bags, handled in cooperation with Hyundai Vinyl and Plastic, located in Seoul. It was the luxury brand’s second single-theme pop-up store, with its first being the Archlight sneakers store located in New York, opened back in 2017.
Kim Hye-ra, Lotte Department Store Luxury Department Chief explains that the luxury brands are moving into South Korea as consumption power among the country’s millennials grows.
Meritz Securities analyst Ha In-hawn says that consumption of luxury goods in South Korea has only grown, even as the country’s economy, in general, has slowed down. The millennial generation, specifically, was embracing luxury goods.
