Lotte and Shinsegae Discount War... Gaining Early Advantage with 350t 'Half-Price Hanwoo'

Lotte's 8 Distribution Companies Merge for 'Lotty Day'
Counterattack to Shinsegae's 'Sseuk Day'
Both Prepare Total 350t of Hanwoo
Homeplus Also Joins Discount Event

Hanwoo (Photo by Lotte Mart).

[Asia Economy Reporter Kim Yuri] The retail rivals Lotte and Shinsegae are set to launch a large-scale group-wide integrated discount event this fall, featuring "Hanwoo half-price discounts." For the event lasting about four to seven days, both companies have prepared a total of 350 tons of Hanwoo beef. Amid high inflation and increasing demand for enjoying Hanwoo at home instead of dining out, the strategy is to attract consumers to their respective channels by offering high-quality Hanwoo at up to half price.

According to the retail industry on the 26th, Lotte, which launched the integrated discount event "Lottky Day" involving eight retail companies this year to counter Shinsegae's "SSG Day," will intensify momentum with half-price Hanwoo discounts at Lotte Mart and Lotte Super starting from the 27th, when offline events officially begin. Lotte Mart will hold a maximum 50% discount event on all 1st-grade Hanwoo products from October 27 to November 2, coinciding with Hanwoo Day on November 1. For this event, Lotte Mart has prepared about 900 head of Hanwoo, approximately 180 tons. The highest grade Marbling Nine Hanwoo products sold at Lotte Mart are also included in the up to 50% discount event. The representative items are "1st-grade Hanwoo sirloin" and "Marbling Nine Hanwoo sirloin." Other popular grilling cuts such as tenderloin, striploin, chuck flap tail, and skirt meat are offered at prices up to 40% lower than usual. Additionally, a "large-sized Hanwoo beef bone and miscellaneous bones pack" for health during the changing seasons is available at event prices. Lotte Super will offer up to 50% discounts on fresh foods from the 27th to November 1. When paying with a Lotte Card, "1st-grade Hanwoo soup cuts and bulgogi" will be sold at about a 50% discount.

Emart and SSG.com have also prepared 170 tons of Hanwoo to meet the demand for Hanwoo Day. Considering that Emart usually sells about 20 tons of Hanwoo per week, this means they have prepared about two months' worth of stock for four days of sales. From the 27th to the 30th, ahead of SSG Day, Emart and SSG.com will offer up to 50% discounts on Hanwoo when customers accumulate Shinsegae points. Emart will sell the most popular sirloin at a 50% discounted price. Understanding that customers mainly purchase Hanwoo sirloin, Emart has increased sirloin stock by 20% compared to last year. Other cuts will be discounted by 40%. They have also introduced a "Hanwoo pre-order system," a service designed to secure high-quality Hanwoo in advance according to order volume to provide to more customers. This applies only to customers using the time-specified delivery "SSG Delivery" service in the "PP (Picking·Packing) Center" zones, Emart's nationwide online delivery centers. Customers can receive their orders on their preferred dates between October 31 and November 2.

Homeplus is also joining the Hanwoo Day discount event, selling all Hanwoo products at up to half price from the 28th to November 2. Since the 24th, they have been selling at discounts of up to 40%. Homeplus has increased its stock by 52% compared to last year's sales volume for this event.

Models are showcasing 'Hanwoo Day' event products at Homeplus Mega Food Market Gangseo Branch in Deungchon-dong, Seoul.
(Photo by Homeplus)

The event prices are cheaper than wholesale prices, and each company expects consumer interest to be higher than in previous Hanwoo Days due to the high inflation. According to the Livestock Products Quality Evaluation Service's Livestock Distribution Information, as of the 24th, the wholesale price for 1st-grade sirloin was 68,146 KRW per kilogram, which converts to 6,814 KRW per 100 grams. Emart's Hanwoo Day event price for 1st-grade sirloin is 5,690 KRW per 100 grams, about 16.4% cheaper than the wholesale price.

The reason each company is focusing on half-price Hanwoo events ahead of the largest retail discount events is that, amid soaring dining-out prices, demand is increasing for enjoying Hanwoo, a representative dining-out item, at a lower cost. According to the "September 2022 Consumer Price Trends" released by Statistics Korea, the consumer price index rose 5.6% compared to September last year. Inflation also recorded 5.7% in August, indicating a continued high inflation phase. Consequently, Hanwoo consumption through dining out is decreasing. According to the "Agriculture and Rural Economy Trends" published by the Korea Rural Economic Institute, the proportion of Hanwoo purchases in the dining-out sector in the second quarter of this year decreased by 0.7 percentage points compared to the same period last year. In contrast, the proportion of purchases at marts is increasing. A representative from a large mart said, "Due to soaring dining-out prices, more customers are buying Hanwoo directly at marts and enjoying it as home-cooked meals," adding, "We expect consumer interest in this Hanwoo Day event to be greater than in previous years."

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