Billion-Won Wines or 50,000-Won Fruit Sets... Polarization in Seol Gift Giving

Flex or Value for Money... Recession-Type Consumption Trend

As the Lunar New Year approaches, demand for ultra-high-end gift sets is increasing, while practical and cost-effective gift sets are also gaining popularity, revealing a polarization in the gift market. While the culture of premium gifting, expanded during the COVID-19 social distancing period, continues, it is analyzed that customers who prioritize practicality and value have also increased amid the '3 highs (high inflation, high interest rates, high exchange rates)' phenomenon.

Billion-Won Wines and High-Quality Korean Beef... 'Premium' Sells Despite Consumption Slump

On the 3rd, when the department store industry sequentially began the main sales of Lunar New Year gift sets, Lunar New Year gift sets were displayed at a department store in downtown Seoul.
[Photo by Yonhap News]

According to the distribution industry on the 12th, department stores are strengthening their 'top-tier' product offerings. Hyundai Department Store is showcasing 'Lunar New Year Premium Wine Gift Sets' worth 30 billion KRW across 16 food halls nationwide starting this year. Among them, the 'Chateau d'Yquem' vertical collection, known as the emperor of dessert wines, consists of one bottle each of Chateau d'Yquem vintages produced between 1945 and 2015, totaling 64 bottles priced at 260 million KRW.

Lotte Department Store has focused on upgrading the quality of 'Korean beef' sets, considered representative of premium Lunar New Year gifts. This year, the number of premium Korean beef gift set items rated 1+ or higher increased by more than 40%. Representative products include the 'Prestige No. 9 Special GIFT' worth 1.5 million KRW and the 'Designated Farm Premium Mixed GIFT' priced at 850,000 KRW.

This 'premium' strategy is analyzed to be driven by diversified customer demands and preferences. In fact, premium Korean beef Lunar New Year gift sales from February 2 to 5 recorded about a 20% increase compared to last year. The culture of putting effort into gifts, expanded during the COVID-19 social distancing period, continues this year as well.

Diamonds, Gold Bars, and Even Cars Appear

Premium labels have also been attached to unique gift sets released by convenience store chains. BGF Retail's CU unusually offered cars for the Lunar New Year. The vehicle is a 4th generation Carnival Signature 9-seater (gasoline) with three specifications: Prime (74.3 million KRW), Summit (88.8 million KRW), and Air Force One (120 million KRW).

Diamonds and gold bars have also appeared. Emart24 is selling a 3.27-carat diamond certified by 'Wooshin,' the largest gem appraisal institute in Korea. It is the largest diamond size ever offered as a holiday gift, priced at 59.9 million KRW. GS Retail's GS25 is selling three types of coins including golden rabbit gold bars weighing 7.5g (2 don, 764,000 KRW), 37.5g (10 don, 3.713 million KRW), as well as 11.25g (3 don, 1.132 million KRW) and 37.5g (10 don, 3.715 million KRW).

Practicality First: Demand for 'Cost-Effective' Gift Sets Also Rises

On the 3rd, when the department store industry sequentially began the main sales of Lunar New Year gift sets, Lunar New Year gift sets were displayed at a department store in downtown Seoul.
[Photo by Yonhap News]

Meanwhile, gift sets emphasizing cost-effectiveness are also popular. According to Emart, from last month 1st to this month 9th, sales of gift sets priced between 50,000 KRW and under 100,000 KRW in pre-orders increased by 45.1% compared to last Lunar New Year. Representative products include the Signature Shine & Apple & Pear set (62,000 KRW) composed of apples, pears, and Shine Muscat grapes; Peacock Shine Muscat Mix (99,400 KRW); Yeonggwang Easy Pack Dried Yellow Corvina Set (20% discount, 72,000 KRW); and CJ Spam No. 12 (59,900 KRW).

At Lotte Mart's Lunar New Year pre-order sales (December 1?27), the volume of price-stabilized sets under 100,000 KRW expanded by more than 50% compared to last Chuseok. The 'Korean Beef Rib Set No. 2 (Steamed Ribs 600g*2, Seasoned Sauce)' and 'Korean Beef Meat Set No. 2 (Soup Meat 500g*2, Bulgogi 500g*2)' are sold at 99,000 KRW for L.Point members. 'Cleaned GAP Apples (11-12 pieces/approx. 3kg)' and 'Jeonju Hanok Pears (6-10 pieces/approx. 5kg)' are sold at 29,900 KRW and 35,900 KRW respectively for L.Point members.

This trend is also detected in online distribution channels. GS Shop's online mall analyzed sales data from the 'Great Lunar New Year' event held from last month 28th to this month 6th, revealing that products priced under 100,000 KRW accounted for a whopping 80% of total purchases. This is an 18 percentage point increase compared to 62% last year.

The increase in those seeking cost-effective gift sets reflects economic conditions such as high inflation, high exchange rates, and high interest rates. At the same time, 'flex consumption' (conspicuous consumption) mainly by high-income groups is also rising, creating polarization. This is considered a typical characteristic of 'recession-type consumption.' The industry explains that during economic downturns, both high-priced products and practical items gain popularity simultaneously in holiday gift sets.

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