By
Feb 09, 2023 (Gmt+09:00)
ASIA HUB
Now South Korea has replaced Hong Kong and Japan as the Asian hub of global fashion houses.
Burberry and Bottega Veneta have authorized their Korean heads to take charge of Asian operations as a whole.
Burberry saw a 23% decline in sales in China last year. By contrast, its sales in South Korea and Japan were up 10% and 28%, respectively.
The Korean offices of jewelry houses Tiffany and Boucheron are now directly reporting to their headquarters, highlighting the growing importance of the South Korean market.
In 2021, Tiffany opened a pop-up store in a Seoul department store for 5 billion won ($4 million). In its first month of business, it garnered sales of 25 billion won.
South Koreans’ luxury spending has already exceeded that of Americans and Chinese shoppers.
They spent an average of $325 on luxury items last year, compared to $280 by Americans and $50 by Chinese, according to Morgan Stanley.
Italian brands saw their exports to South Korea up 4.4% on-year in 2022, according to Il Sole 24 Ore, an Italian media outlet. Leather products, shoes, clothes and jewelry topped the list of their export items.
LEVERAGE OF K-POP
The luxury fever during the pandemic was led by those in their 20s and 30s, who opened their wallets toward high-end items amid travel restrictions.
To appeal to those younger consumers and create trendy images, fashion brands are leveraging the power of Korean idol groups such as BTS and Blackpink.
Eighteen luxury brands, including Chanel, Dior and Gucci, have appointed K-pop stars as their global ambassadors.
Some members of the Arnault family, behind Italy's luxury empire LVMH, are known to be huge K-pop fans.
Delphine Arnault, daughter of LVMH founder Bernard Arnault, named BTS’ Jimin and Blackpink’s Jisoo as global ambassadors, shortly after she became Dior’s CEO last month.
Chanel’s official ambassadors include Jennie of Blackpink, as well as G-DRAGON. She has been a Chanel ambassador since 2019.
K-pop idols have a huge fan base in Europe, Southeast Asia and South America as well.
“Fashion items Korean K-pop and TV stars have worn tend to sell out early,” said a fashion company official.
To catch up with the trend, duty free shops in Korea are preparing to open in-house idol goods stores to lure luxury brands.
NEW BRANDS ON THE WAITLIST
Other foreign brands are keen to muscle into the Korean market.
Department store officials in Seoul said they were being bombarded with requests by European embassies or their domestic agents to open new brand shops. Previously, they had little chance of meeting with foreign diplomats.
On the contrary, Korean fashion designers have not yet expanded beyond their home turf.
A fashion platform head noted their heavy reliance on K-pop and drama content for marketing, instead of building their brand identity and delivering brand value.
Write to Jeong-cheol Bae and Jong-Kwan Park at bjc@hankyung.com
Yeonhee Kim edited this article.
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