South Koreans are active participants in the domestic economy and retail sales have continuously grown over the last years. As the COVID-19 pandemic hit, shoppers were more careful with their money, but the consumer sentiment index has quickly recovered since then. However, even before the COVID-19 pandemic hit, brick-and-mortar stores were beginning to lose market share to increasing e-commerce sales, the pandemic has merely accelerated this development.
But even when shopping in physical stores, the digital shift is noticeable. Self-checkout counters can be found in every larger store, some companies even launched unmanned or hybrid-type stores for the convenience of their customers and to lower inter-personal contact. Convenience was also one the main reasons why e-payment services are being used more commonly, with many options only requiring the customer’s phone to make payments.
Generally, the most money was spent on non-consumption expenditures, like household appliances or clothes, followed by food. During the ongoing corona crisis, consumers tended to purchase more luxury brand items, as it was seen as a safe investment. As South Koreans are generally spending more time at home than before, the spending on household related items or entertainment at home was expected to increase significantly.
A digital shift
South Korea with its high internet speed is a highly digitalized country, and online shopping has become a leading channel in the retail market, driven by its ready availability, fast delivery times, and compatibility with social distancing measures due to COVID-19. As more consumers turn to digital shopping, traditional storefront shopping has declined, leading to vacant stores in popular shopping districts.But even when shopping in physical stores, the digital shift is noticeable. Self-checkout counters can be found in every larger store, some companies even launched unmanned or hybrid-type stores for the convenience of their customers and to lower inter-personal contact. Convenience was also one the main reasons why e-payment services are being used more commonly, with many options only requiring the customer’s phone to make payments.
Shopping trends
Besides quality playing a big role in purchase decisions, South Korean shoppers also take price into consideration when shopping. Checking for a cheaper prices or coupons is very common, and retailers have adapted to this by often offering special promotions, like two-for-one, special event, or member benefits.Generally, the most money was spent on non-consumption expenditures, like household appliances or clothes, followed by food. During the ongoing corona crisis, consumers tended to purchase more luxury brand items, as it was seen as a safe investment. As South Koreans are generally spending more time at home than before, the spending on household related items or entertainment at home was expected to increase significantly.
