40-Year-Old Department Store Renewal War... Diverse Strategies of 'Luxury' and 'Catching MZ'

Lotte Department Store Opens Korea's Largest Beauty Hall
First Renewal in 40 Years Since Opening in 1979
22-Year-Old Shinsegae Focuses on Gangnam Branch
Hyundai Targets Demand by Capturing MZ Generation

Renewed view of the perfume store on Basement Level 1 of Lotte Department Store Main Branch.

[Asia Economy Reporter Jeon Jinyoung] Major domestic department stores, some over forty years old, are undergoing full-scale renovations to reinvent themselves as playgrounds for the MZ generation (Millennials + Generation Z). Reflecting changing trends, transformations range from bold moves like placing fragrance brands on every floor to gathering domestic designer fashion brands in one place to precisely target female customers aged 25 to 35.

According to the distribution industry on the 9th, Lotte Department Store’s main branch reopened its beauty hall on the basement 1st floor to the 1st floor on the 1st of this month after renovation. Including 30 new brands, a total of 83 beauty brands are gathered in one place, boasting the largest scale in the country. Lotte Department Store has been sequentially renovating the entire main branch since March last year. This is the first major change since its opening in 1979. The living hall was renovated in 2019, women’s fashion, men’s fashion, and golf stores in 2021, the children’s hall in 2023, and the living hall and Young Plaza will be renovated in 2024 to complete large-scale renovations. The renovation effect is also clearly visible. The men’s fashion hall, which strengthened its luxury line by bringing in Louis Vuitton Men’s and Gucci Men’s, saw sales triple from March to September this year compared to the previous year after renovation.

Shinsegae Department Store is focusing on its top-grossing store, Gangnam Branch. Having opened in 2000 and now 22 years old, Gangnam Branch aims to capture the 20s and 30s generation beyond its existing luxury image represented by ‘ShinGang’. On the 28th of last month, Gangnam Branch renovated its young fashion specialty hall, targeting Millennials aged 25 to 35, and introduced the new contemporary genre for the first time in the industry. The women’s designer brand ‘Recto’, located in the young fashion hall, recorded sales of 160 million KRW over the three days from the 26th to the 28th of last month. Earlier, Gangnam Branch opened a new luxury cosmetics and accessories store after 10 months of renovation work in August last year and renovated its beauty hall in March.

Hyundai Department Store is transforming its stores with the concept of a ‘department store for the MZ generation’, building on the success of The Hyundai Seoul. In December, it will open ‘The Hyundai Daegu’, which will continue the success of The Hyundai Seoul. Hyundai Department Store Daegu, which will be rebranded as The Hyundai Daegu, first introduced a young fashion hall composed of brands favored by the MZ generation and a food hall, and is undergoing changes by attracting the offline store of the fashion brand ‘Matin Kim’, which has a strong fandom among the 20s and 30s, for the first time in Korea.

Galleria Department Store has been renovating with the concept of ‘premium lifestyle’. In February, Galleria transformed its luxury hall food hall ‘Gourmet 494’ into a ‘Delicery’ store where customers can enjoy restaurant-quality gourmet food and purchase the ingredients used in the cooking together.

A department store industry official said, "As consumption patterns shift online, it is important to make department stores places where people want to visit first to increase foot traffic," adding, "Various strategies are being adopted to capture customers’ attention."

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