Chinese shoppers in South Korea shun luxury for local brands
By Minwoo Park and Joyce Lee
SEOUL (Reuters) - Chinese visitors to South Korea are buying less from global luxury mainstays like Louis Vuitton and Chanel in favor of cheaper homegrown brands, as young, independent travelers make up a bigger share of tourists.
Lured by the "Korean Wave" of culture exports, from soap operas and K-pop music to food and fashion, price-conscious younger Chinese visitors are seeking a more authentic and less expensive shopping experience.
South Korea trails only Thailand as an overseas destination for Chinese travelers, whose heavy retail spending has helped make South Korea the world's largest duty free shopping market.
The emphasis on value will put further pressure on global luxury retailers already grappling with slowing sales in China after years of skyrocketing growth, as a government crackdown on graft and lavish spending bites.
"You can buy those big brands everywhere, and it is actually cheaper to buy those brands in other countries compared to the prices in South Korea," said 21-year-old Zhu Xin, who was shopping at the Stylenanda store in Hongdae, a Seoul neighborhood popular with young adults.
"Now that we are here, we should buy local brands," she said.
Average prices on best-selling items from global luxury brands in South Korea are cheaper than they are in mainland China, but still cost more than in Europe, Singapore and Dubai, according to HSBC data.
At downtown Seoul duty free shops run by Hotel Lotte's [HTLOT.UL] Lotte Duty Free and the Samsung Group's Hotel Shilla, LG Household & Healthcare's Whoo and Amorepacific's Sulwhasoo cosmetics were the top-selling brands in 2015, overtaking Louis Vuitton, Chanel and Richemont's Cartier, store data shows. Continued...