Even During the COVID Era, Sales Quadruple... The Charm of 'Funding' Enjoyed Like a Game

'Hadogo' Sales Quadruple Year-on-Year from January to September
Glad Hotel Sells Steaks on Wadiz
'W Concept' Also Secures Funding Projects
Pre-Planning Reduces Inventory Burden
Acts as Tester to Gauge New Product Response

[Asia Economy Reporter Cha Min-young] Amid the overall contraction of the distribution industry due to the novel coronavirus infection (COVID-19), some companies are finding answers through the pre-planned sales method known as 'crowd funding.' This strategy, which stimulates the interest of the MZ generation (a combination of Millennials and Generation Z) who prioritize quality-centered rational consumption over famous brands, has proven effective.

According to industry sources on the 9th, the fashion-specialized funding and curation platform 'Hago,' operated by Hago L&F, saw its sales from January to September this year increase by 372% compared to the same period last year, nearly quadrupling. Sales in the funding sector increased 5.5 times (450%), driving overall sales growth. Among these, sales of accessories including jewelry and bags increased sixfold (500%) during the period, while the shoe category recorded an almost ninefold (796%) increase in sales.

Hago has built competitiveness in selling self-produced products while securing loyal customers. For example, the currently ongoing funding for the 'Hago Saddle Bag' is the 118th funding project. Since its first launch in February 2014, it has established itself as a steady seller and contributed to securing loyal customers for Hago. The 'Bucket Bag' is on its 105th funding, while the 'Belted Rider Jacket' and 'Leather Jean Jacket' are on their 16th and 20th fundings, respectively. Additionally, Hago collaborates with domestic designer brands such as the fashion brand 'Lukast' and jewelry brand 'Matthias' to exclusively offer various products as funding items.

The online fashion select shop 'W Concept' also changed its irregular crowd funding projects to a fixed monthly service in May. Funding projects are held during the first week of every month. Each project accepts orders for 10 days after opening, and if the goal is achieved, shipments begin from the 2nd to 3rd week. W Concept's funding projects, which started in August 2018, sourced items that had many requests for restocking or re-release, receiving positive responses. One of the 'October funding' products, the 'N Or Overfit Button Point Fur Coat,' accepts orders until 6 p.m. on the 12th and will be shipped sequentially from the 26th. This product has already exceeded its target amount by 456%.

Glad Hotel & Resort partnered with Wadiz, Korea's No.1 crowd funding platform company, and achieved high sales in steak funding sales, leading to a second round of sales last month. The product in question is the 'Premium Beef Steak (Elbon, T-bone, Porterhouse)' from the 'Glad Chefs' edition. During the first sale, it received great responses by achieving 1408% of the funding goal through Wadiz funding.

The funding sales method has the advantage of planning the sales volume in advance, reducing the burden of inventory storage and sales. In particular, curating the selection of high-quality products to introduce is essential in this process. As more customers feel satisfaction through this process, loyal customers naturally increase. It is also interpreted that the online-based non-face-to-face (untact) trend has influenced this. For designer brands, it is an opportunity to pre-test consumer reactions to new designs. Another characteristic is that if the minimum order quantity is not met, the product is not sold at all. This creates a kind of shared goal, making it feel like a 'game.'

Hong Jung-woo, CEO of Hago L&F, said, "The quality of the products, reasonable price range, and curated products carefully selected by experts provide high satisfaction to consumers, which is driving sales growth. Although funding products take relatively long to be delivered, their popularity seems to contribute to sales," he said.

This content was produced with the assistance of AI translation services.