"Shoes Don't Need to 'Open Run'... Six Gucci Stores in One Department Store"

Luxury Popularity Drives Department Stores to Segment Categories
Expanding Separate Stores for Men's Fashion, Jewelry, Shoes, etc.
Widening Consumer Base and Diversifying Products Amid Deepening Polarization and Flex Culture

Galleria Luxury Hall to Open Exclusive Chanel, Louis Vuitton, Dior Shoe Stores Within the Year
Shinsegae Gangnam Has Six Gucci Stores... Hermes Opens 'Accessories' Store on First Floor
Lotte Main Store's Separate Men's Overseas Fashion and Luxury Stores Boost Sales Threefold

Lotte Department Store Main Branch Men's Overseas Fashion Hall.

Office worker Kim Soyeon (32) decided to buy a 'gift for herself' with the bonus she received this Chuseok and headed to a department store in Gangnam, Seoul. She planned to visit luxury boutiques like Chanel and Dior to check out the trending mini bags, but most stores had long waiting lines on the weekend afternoon, and some were already closed to new entrants due to full capacity. Wanting to carefully examine and purchase a product she truly liked, Kim changed her 'flex' item from a bag to a ring. Although still Chanel, the fine jewelry store, which is separate from the boutique, did not require an 'open run' and offered relatively more relaxed service.

As the popularity of luxury brands continues, department stores are strengthening their luxury-specialized stores. Instead of boutiques showcasing bags, clothing, and shoes together, they are subdividing categories to create separate stores for men's fashion, jewelry, shoes, and more. This change reflects the intensified consumption polarization in recent years and the expansion of consumer base, especially among the 20s and 30s generation, who have popularized the 'flex' culture, diversifying the items they seek.

According to the distribution industry on the 22nd, Galleria Department Store has started renovation work to open standalone luxury shoe stores for brands like Chanel, Louis Vuitton, and Dior within the Galleria Luxury Hall in Apgujeong-dong, Seoul, by the end of the year. Galleria plans to add these brand-specific stores to the existing luxury shoe zone on the West 3rd floor, which currently includes Manolo Blahnik, Christian Louboutin, and Jimmy Choo, aiming to create the 'best luxury shoe zone in Korea.' The department store stated, "All three newly opened stores will be the highest-level standalone shoe stores in Korea."

Recently, as luxury brands have attracted general consumers with sufficient purchasing power, luxury consumption patterns have changed. In the past, only some VIPs visited boutiques to buy Chanel and purchased shoes if they liked them. Now, the range has expanded to include general consumers who also consider luxury shoes like Chanel as a purchase option.

With separate stores, the assortment expands, allowing customers to access a wider variety of category products, and waiting lines are dispersed, enabling comfortable shopping without open runs. This increases purchase frequency among visitors, resulting in satisfaction for brands, department stores, and consumers alike.

The first to attempt this was Shinsegae Department Store Gangnam branch. In June 2016, it introduced a men's specialty section on the 6th floor of the main and new buildings and the 7th floor of the new building, launching the Louis Vuitton men's store first among Korean department stores. Currently, the Gangnam branch has six Gucci stores: women's boutique 1 and 2, bags, jewelry, shoes, and men's. Chanel and Louis Vuitton each have three stores. Hermes recently opened a separate accessory store on the 1st floor selling scarves, wallets, and other entry-level products.

Lotte Department Store Jamsil branch also has more than two stores for Gucci (complex, accessories, clothing, men's), Louis Vuitton, Dior, and others. The main store renovated its men's overseas fashion section, introducing numerous separate men's stores for luxury brands including Dior, Tom Ford, Dolce & Gabbana, and Valentino, resulting in sales tripling from March to September compared to the previous year.

As department stores subdivide luxury brand categories and increase the number of stores, the proportion of luxury sales in total sales is also growing. The share of luxury in Shinsegae Department Store's sales rose from 17% in 2019 to 21% in 2020 and 26% last year. Lotte Department Store expanded from 12% in 2019 to 20% last year. Hyundai Department Store also increased from 19% in 2019 to 24% last year. An industry insider said, "At one point, we focused on the 'revenge consumption' phenomenon due to COVID-19, but now we see it as a change in consumption behavior rather than a special case," adding, "Accordingly, the subdivision of luxury categories will continue to expand."

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