[Report] Shoppers Crowd Mike Beach... Visiting Lotte Duty Free Da Nang City Store

Tourists Flock to 2000㎡ Store
Handling 200 Brands from Luxury to Local Products
Advantage of 'Comfortable Duty-Free Shopping Without Haggling'
Local Products Like Vietnamese Gin and Vodka Popular
Annual Sales Target of 50 Billion KRW with Overseas Travel Recovery
Hanoi City Store Opening Next Year... 5 Stores in Vietnam
"Over 60% Market Share in Vietnam Duty-Free Market"

Visitors are shopping at the Lotte Duty Free Da Nang City Store in Da Nang, Vietnam.

[Da Nang=Asia Economy Reporter Yuri Kim] "This is the coffee shop in the Dalat area I saw yesterday. It's cheaper here."

Da Nang, a resort city in central Vietnam. After passing the luxury resort and hotel complexes along My Khe Beach, several tour buses stopped at VVMall. Upon taking the escalator to the second floor, a 2,000㎡ (about 600 pyeong) store was bustling with tourists out shopping. This is Lotte Duty Free Da Nang Downtown, Vietnam's first downtown duty-free store and the largest duty-free store in Vietnam, which opened last month.

◆"Comfortable Duty-Free Shopping Without Bargaining"... Local Products Like Vietnamese Gin and Vodka Popular

As soon as you go up to the second floor, you encounter a sophisticated shopping space rarely found in downtown Da Nang. The cool air, high ceilings, bright lighting, and the space divided into four zones?cosmetics, food & local products, watches & liquor, fashion & accessories?give a comfortable and neat impression. Lotte Duty Free designed the flow so that even 500 customers, such as cruise passengers, can shop simultaneously.

The biggest strength of Lotte Duty Free Da Nang Downtown is that you can shop for 200 brands in one place, from high-end luxury brands to local products. They also emphasize that customers can trust the prices, which are duty-free with value-added tax (10% of retail price) exempted, without worrying about bargaining or overcharging. Upon entering the store, the cosmetics corner is the largest area right in front. They carry 55 beauty brands including global brands like Dior and Yves Saint Laurent, as well as K-brands such as Sulwhasoo and Whoo.

Following the corner, you reach the food and local products section, which is the busiest among shoppers. The most popular items recently among Koreans in this section are Vietnamese liquors like vodka and gin. Consistently well-selling Vietnamese coffee and dried mangoes also fill the walls. They also carry famous Vietnamese pearl brands. Targeting casino customers connected to the Da Nang Downtown store, the watch section featuring brands like Longines and Tissot plans to expand its share in line with the casino opening and the return of Chinese tourists.

Da Nang is a popular Southeast Asian resort destination that attracted about 3.66 million tourists in 2019 before COVID-19, and it is one of the regions with the greatest potential for duty-free market growth after the normalization of overseas travel. Kim Ki-kyung, CEO of Lotte Duty Free Vietnam, said, "Within two weeks of opening, 90% of local Korean travel agencies have signed group visit contracts with Da Nang Downtown," adding, "Currently, Korean customers account for about 80%, so the product assortment has been expanded mainly with items popular among Koreans." According to the Da Nang Tourism Bureau, hotel occupancy, which was about 11% in 2021 due to COVID-19, recovered to 75% in the first half of this year and is increasing further as the winter peak season approaches. It is expected that the annual sales of Da Nang Downtown will reach around 50 billion KRW once overseas travel normalizes.

Visitors are shopping at the Lotte Duty Free Da Nang Airport store departure area in Da Nang, Vietnam.

◆Hanoi Downtown Store to Open Next Year... Lotte Duty Free to Hold 60% Market Share in Vietnam Duty-Free Market

Lotte Duty Free entered the Vietnam duty-free market starting with Da Nang Airport store in 2017. After opening Nha Trang Cam Ranh Airport store in 2018 and Hanoi Airport store in 2019, they opened the Da Nang Downtown store last month. Next year, they plan to open the Hanoi Downtown store. It will be located on the 6th floor of Trang Tien Plaza in central Hanoi, covering 1,598㎡ (about 480 pyeong). Being in Hanoi's oldest luxury shopping mall and near the famous tourist spot Hoan Kiem Lake, it is expected to attract travelers from around the world. Lotte Duty Free plans to present this store as a differentiated location combining Vietnamese cultural characteristics and Hallyu content.

According to the Vietnam National Administration of Tourism, from January to November this year, 2.95 million foreign tourists visited Vietnam. Among them, Koreans accounted for about 763,900, or 26%, ranking first. Based on this recovery, it is expected that the market will gradually recover with the return of Chinese tourists. Before COVID-19, the Vietnam duty-free market size was about 300 billion KRW, and it is expected to exceed 500 billion KRW and grow up to twice as large by 2026. Lotte Duty Free aims to hold more than 60% of the Vietnam duty-free market share, including the Hanoi Downtown store opening next year. CEO Kim said, "Lotte Duty Free will use Vietnam as a forward base for the Southeast Asian market and will preempt the duty-free market in neighboring countries such as Indonesia and Malaysia."

Next year, Lotte Duty Free Hanoi City Store will open at Trang Tien Plaza in Hanoi, Vietnam.

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