High-End Leggings Priced at 100,000 Won Sell Like Hotcakes... Thousand-Won Shops Face Desertion Amid 'US Polarization'

CNN "Consumption Gap Between Social Classes Is Widening"

The athleisure brand lululemon, known as the 'Chanel of the yoga wear industry' in the United States, posted strong earnings, but the performance of Dollar General, the 'American version of the 100-won shop' selling low-priced products, showed a decline, raising concerns about widening consumption gaps between social classes.

'Chanel of Yoga Wear' lululemon Q2 Sales Up... "New Customers Keep Coming In"

[Image source=Pixabay]

According to CNN on the 3rd (local time), lululemon's net sales in the second quarter increased by 18% compared to the same period last year, and gross profit rose by 23%.

Calvin McDonald, CEO of lululemon, said, "Our existing customers are still opening their wallets and spending money, and new customers continue to come in."

lululemon leggings cost over 100,000 won per pair, so they are by no means cheap. However, precisely because of the high price, the perception of it as a 'premium brand' has taken hold, making it popular among American women.

Brian Nagel, an analyst at financial firm Oppenheimer, said customers are still willing to spend money on innovative brands like lululemon. Nagel stated, "(lululemon) is a very strong brand that continues to launch new products in the market, and discerning consumers are spending on it."

'American Daiso' Dollar General Struggles Amid Decline in Consumer Spending

[Image source=AFP Yonhap News]

On the other hand, Dollar General recently announced its second-quarter results, revealing a hit to its sales. Known as the 'American Daiso' for mainly selling low-priced products, Dollar General operates about 18,000 stores in the United States and Mexico.

Dollar General stated that it is facing difficulties due to reduced consumer spending and increased theft. Jeff Owen, CEO of Dollar General, said, "Core customers continue to report feeling financial pressure."

Neil Saunders of market analysis firm GlobalData said, "The temporary pandemic (COVID-19) relief benefits have disappeared, worsening the situation for low-income groups," adding, "Low-income consumers are cutting back on purchases of non-essential items to save money."

Dollar Tree, a discount store chain similar to Dollar General, also reported last month that "customers are changing their shopping patterns after years of increased spending."

Shannon Seery, an economist at Wells Fargo, analyzed that low-income households in the U.S. are under economic pressure. He explained, "Historically, the households most affected by inflation are low-income households," and "items like groceries and energy now take up a larger share of their household budgets."

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