Chairman Jeong Ji-seon's Contrarian Thinking Pays Off... The Hyundai Approaches the '1 Trillion Won Club'

A Bold Break from Department Store Norms... Forgoing 170 Billion KRW in Sales to Create Landscaping
Monthly Sales of 100 Billion KRW Without 3 Major Luxury Brands... Possibility of 1 Trillion KRW Annual Sales in the Shortest Time

[Asia Economy Reporter Jo In-kyung] The 'reverse thinking' of Chung Ji-sun, Chairman of Hyundai Department Store Group (pictured), has paid off. Despite the adverse conditions caused by COVID-19, The Hyundai Seoul, which opened its doors, is attracting a young customer base, raising expectations that it might become the fastest department store to reach annual sales of 1 trillion won.

Unexpected Surge with Daily Sales of 10 Billion Won

The Hyundai Seoul recorded surprising sales from the early days after its opening. In the six days following February 24, sales reached approximately 37 billion won, and monthly sales surpassed 100 billion won. During the March 1 holiday period alone, more than one million visitors flocked, achieving daily sales of 10 billion won, demonstrating remarkable performance.

The Hyundai Seoul attracted attention with its bold attempt to break the mold of traditional department stores by incorporating a forest and artificial waterfall inside the store. Chairman Chung instructed to create a place where many people could come, enjoy, and stay longer rather than just stocking and selling many products. The total area of The Hyundai Seoul is equivalent to 13 soccer fields (89,100㎡), making it the largest in Seoul, but the actual sales floor area is only 49%, which is about 30% smaller than the average sales floor area (65%) of Hyundai Department Store's 15 branches.

The strategy of widening store pathways and dedicating half of the store to nature-friendly rest and cultural spaces attracted more customers even amid the COVID-19 situation. The 11,240㎡ landscaping area is typically large enough to accommodate 170 clothing stores, which translates to an annual sales sacrifice of about 170 billion won.

A Hyundai Department Store official said, "Chairman Chung, who visited the store at the time of opening, was satisfied with the bold reduction of sales floor area and the creation of healing spaces in the remaining area," adding, "This attracted more customers, including families, resulting in increased sales."

With the conviction that department stores can provide rest and healing to customers weary from the prolonged COVID-19 pandemic, Hyundai Department Store recently created a 2,628㎡ (approximately 800 pyeong) landscaping space on the 7th floor of the Mokdong branch.

Success of Food Halls Over Luxury Brands

Although there are no top three luxury brands, competitive marketing by electronics stores such as Samsung and LG drove strong sales. About 600 domestic and international brands are housed on each floor according to themes, and on the first basement floor, a space equivalent to two soccer fields combined (14,820㎡) hosts around 90 famous restaurants and food & beverage (F&B) brands. Stores like 'ARKET', 'BGZT (Bungaejangter) Lab', 'NICE WEATHER', and 'Yongjeong Collection' on the second basement floor have emerged as must-visit 'hot places' among customers in their 20s and 30s, attracting high visitor numbers and sales.

A Hyundai Department Store official explained, "We brought in many brands familiar to the MZ generation, and with over 80,000 Instagram posts alone, it has become a hot place that young customers are curious about and prefer, enhancing the store's attraction."

The Hyundai Seoul is expected to easily achieve its first-year sales target of 630 billion won, having already reached monthly sales of 100 billion won without the top three luxury brands. Expectations are growing for it to become the fastest department store to reach annual sales of 1 trillion won. Currently, five department stores in Korea have annual sales exceeding 1 trillion won as of the end of last year: Shinsegae Department Store Gangnam Branch, Lotte Department Store Main Branch Jamsil, Shinsegae Department Store Centum City Branch, Hyundai Department Store Pangyo Branch, and others. Notably, these '1 trillion club' department stores each house at least one luxury brand represented by 'Herm?s, Louis Vuitton, Chanel.' The fastest to join the 1 trillion club so far was Hyundai Department Store Pangyo Branch, which took 5 years and 4 months.

Due to The Hyundai Seoul's better-than-expected sales performance, major luxury brands are showing considerable interest in opening stores there. A Hyundai Department Store official said, "The initial sales of The Hyundai Seoul exceeded expectations," adding, "The timing for achieving annual sales of 1 trillion won is expected to be accelerated, and it is likely to become the first department store to reach 1 trillion won in the shortest time."

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