"Changing Store Layout Boosts Sales" ... Large Marts Shift to Renewal Strategy

[Asia Economy Reporter Jo In-kyung] As the online shopping market, including mobile, rapidly grows, large supermarkets that once considered closing or withdrawing stores are now aiming to improve performance through store renovations and product enhancements. Even amid the prolonged COVID-19 pandemic, consumer sentiment is reviving, leading to strategies to attract customers back to offline stores and increase their in-store dwell time.

Store Reorganization Strategy from the Customer's Perspective

Emart plans to renovate more than 15 stores starting with the Byeollae branch in Namyangju, Gyeonggi Province this year. Although the Byeollae branch, which opened in August 2013, has been operating for less than eight years, it was proactively renewed in mid-month considering the upcoming large-scale apartment complex nearby.

The key keyword for Emart's renovation is "rebirth from the customer's perspective." The plan is to transform stores into customer-oriented spaces by completely innovating existing stores and reorganizing spaces, providing customer-focused services while making stores places where customers want to visit and stay longer.

While online-based retailers emphasize low prices and convenience, Emart focused on the offline retailer's differentiating point of "experience" through the renovation. The emphasis was on providing spaces where customers can enjoy a pleasant shopping experience with their families beyond just product sales.

The effect is appearing immediately. For example, Emart Wolgye branch's sales increased by 57.2% year-on-year from June last year to April this year after renovation, and the number of visiting customers increased by 32.2%. All nine stores renovated last year recorded double-digit sales growth rates year-on-year from January to April.

Emart's Development Manager Lee Doo-seop said, "Based on data-driven customer analysis, we are renovating stores to maximize customers' dwell time by strengthening experiential elements, which are the strengths of offline retailers. Customers will be able to enjoy shopping even more at the renewed offline Emart."

Offline Store Strategy Revised from 'Reduction → Maintaining Scale'

Lotte Mart also changed its strategy from closing underperforming offline stores to renovating aging or weak stores.

Earlier, Lotte Shopping announced a restructuring plan in February last year to close about 200 unprofitable stores out of 700 offline stores including department stores, marts, and specialty stores. Lotte Mart closed a total of 12 stores last year alone, and it was expected to reduce the number of stores by a similar scale this year.

However, this year, efforts to improve performance and strengthen competitiveness through store renovations have gained momentum. In particular, the Lotte Mall Yeosu branch, which reopened on the 5th of this month after five months of remodeling, has strengthened fashion, furniture & electronics, and interior product categories, attracting local consumers' attention and achieving double-digit sales growth.

A Lotte Mart official explained, "Last year, we sought performance recovery through store restructuring, but this year, we aim to secure competitiveness by maintaining scale and improving aging facilities and renovating stores."

Homeplus also plans to convert 10 stores nationwide into "Homeplus Special" stores by the end of this year. Homeplus Special is a hybrid store that allows customers to purchase everything from small-sized products sold at conventional large marts to bulk products handled at warehouse discount stores in one place.

Referring to the success of 20 stores previously converted to Special stores, Homeplus plans to sequentially convert 1 to 3 stores every month starting with Wonju and Incheon Cheongna branches in July.

A Homeplus official said, "We will actively utilize the funds secured by closing four stores last year?Ansan, Daegu, Daejeon Dunsan, and Daejeon Tanbang?and focus investments on facilities, personnel, and environmental management."

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