Customers’purchasing power starts to soar, providing more space for the growth of boutique designers’ jewellery stores; the fashion retailing scene in South Korea is expected to be more fun.
With its steady economy and overwhelming star power effect, South Korea is currently experiencing a thriving fashion retailing business. Consumers are becoming more fashion-forward, and ordinary fashion jewellery products may no longer match the taste of discerning customers. Some well-off consumers have already turned to buying at boutique designers’ shops, driving the market to be more competitive.
As one of the BRIICS countries, South Korea is certainly an emerging country that has achieved rapid development in all aspects in recent years. According to the 2010 World Fact Book of the Central Intelligence Agency of the United States, South Korea’s GDP in terms of purchasing power parity has climbed to US$1.459 trillion, ranking it number 13 among 227 countries worldwide. Meanwhile, its GDP per capita has reached US$30,000, as compared with the figures for 2009 and 2008 of US$28,300 and US$28,400 respectively, showcasing that its customer buying power is indeed climbing over the years.
In the last few years, South Korea has seen a remarkable change in its fashion retail industry, with the emergence of a burgeoning online fashion business nationwide and globally. Given that department stores or chain stores in overseas markets do not tend to carry any brands from Korea, online shopping seems to be the only way young customers can patronise this blossoming fashion business. All in all, thanks to its rapid economic take-off, South Koreans nowadays do enjoy a better quality of life.
Seoul Fashion Week – organised by Seoul Metropolitan Government and Seoul Business Agency’s Seoul Fashion Centre – debuted in 2000, aimed at nurturing local design talents and showcasing their collections of apparel and fashion jewellery and accessories on the world stage. Perhaps from that year onwards the country has been involved in the fashion business. AFJA Review
talked about South Korea’s fashion retailing business with a few tenants of the fashion jewellery and accessories section of “Doota,” a chic and prominent department store housing mainly outlets focused on trendy elements for young people. That section accounts for approximately 20% of the store.
Boutique designers’ jewellery stores to grow
“Since the economy became much more stable during this decade, customers prefer or are more able to afford to purchase more uniquely designed fashion jewellery and accessories. There is indeed an increasing number of smaller retailers in the market. Small-scale businesses [offering uniquely designed products] will start to compete with wholesalers [selling mass-produced products],” Gyun Hae Mi of Hamkoon pointed out.
Jung Ji Young of SO YOU expressed a similar view to that of Ms Gyun. Ms Jung noted that the standard of living has largely improved in recent years, and people are fonder of buying one-of-a-kind and luxury items to show off their wealth. Therefore, female customers are more willing to spend more on the uniquely designed fashion jewellery and accessories items that are causing the industry to expand rapidly.
On the other hand, to Lee Jung-a of One-day fashion store, fashion jewellery and accessories may serve as a pointer when judging whether or not a person is wealthy and trendy. She noted that the widened gap between rich and poor has affected Koreans’ preferences in fashion items. People with higher income will prefer purchasing at boutique designers’ stores which are more rare-design oriented, despite the higher price level. She continued, “Customers are aware that boutique shops can provide them with customised items that best represent themselves. The commonly seen manufactured products found in the shopping malls then appear to have less character and to be less original. Therefore, well-off customers prefer boutique designer stores rather than shopping malls.”
“Possessing a sense of distinctive originality, boutique designers’ fashion jewellery and accessories stores do stand out from the shopping malls that sell commonly popular products. The former have found their niche in the market and draw plenty of customers,” Kim Sun Ja of CUZ U commented.
However, Ms Gyun highlighted that the boutique fashion jewellery market in Korea is not yet mature. At the moment, consumers still prefer the big international names, not really caring about the design. Many retailers purchase fashion items from mass-wholesalers and re-sell them as branded products. Once brand shops develop their own designed products, they can enlarge their market share and further develop their businesses. Therefore, she believed the boutique jewellery market will certainly grow and develop in the future.
Glittering star power
Apart from the economy and government support, what other factors are contributing to the burgeoning Korean fashion jewellery
business? As no other country is as greatly influenced by celebrities as Korea, the glamorous star effect does count for a lot. Korean celebrities have long shown their enthusiasm for promoting the development of the fashion business. For example, very famous Korean celebrities such as Jang Geun Suk, Kim Hyun Joong, Kang Min Hyuk and Lee Jong Hyun visited the last edition of Seoul Fashion Week. Ms Gyun agreed that the Korean star effect has reinforced growth in the market. Furthermore, this kind of emerging star power has even started influencing Hong Kong, Japan and other Asian countries in terms of their fashion style.
Probably thanks to the star power, the Korean fashion retailing business has become a flourishing scene among the younger generation, as Ms Kim suggested. Talking about the favourite styles of local people, she continued, “Customers just love the bold palette contrast, the modern and vintage twist, and the striking designs. Moreover, they are quite into the sparkling crystal stones too.”
From Ms Lee’s point of view, Korea still follows the Japanese style, yet consumers have started looking for exclusive or unique pieces of jewellery instead of the usual products. She hopes Korean people will soon develop their own kind of style, and that some day Korea can develop into one of the versatile fashion cities like Tokyo and London. Ms Kim said, “There is room for Korean fashion retailing to develop further. We do see great potential in the industry, and we look forward to seeing Korea blossom as a fashion hub in the future.”