'Lee Hyori Effect' in a Month... Lotte ON's 'True Fan Strategy' Worked

'Lee Hyori Advertising Campaign' Shows Results in One Month
'Lock-in' with On and the Club... Subscribers Increased 4 Times Compared to Last 6 Months
Verticals like Beauty and Fashion See Over 50% Growth in 2 Weeks

Lotte ON is fully capitalizing on the 'Lee Hyori Effect' just over a month after launching an advertisement featuring singer Lee Hyori as its model. The synergy created with 'On & The Club,' an integrated membership for specialized vertical categories including beauty, luxury, fashion, and kids, which was launched around the same time, has led to a noticeable increase not only in membership numbers but also in sales.

Advertising campaign "Shopping Fantasy ON" featuring singer Lee Hyori as the model [Photo by Lotte ON].

According to the distribution industry on the 17th, the number of new subscribers to Lotte ON's On & The Club last month increased fourfold compared to the average of the past six months. It is analyzed that consumers who developed interest in the Lotte ON channel through Lee Hyori became loyal 'locked-in customers' by joining the On & The Club membership. The issuance of vertical service coupons also more than doubled compared to the previous month. By consolidating benefits that were previously scattered across each vertical onto the On & The Club page, the number of customers recognizing vertical benefits also increased.

As the fragmented battles among verticals became visible at a glance through membership integration, member purchasing activity also became more active. In October alone, the amount spent by one On & The Club member in vertical services was 70% higher than that of non-members. Not only in vertical stores but also across the entire Lotte ON platform, the purchase amount per member was over 60% higher compared to non-members. The proportion of On & The Club subscribers who actually made purchases also doubled compared to the previous month. These changes led to an increase in sales. From the 1st to the 13th of this month, sales in the four verticals increased by more than 50% compared to the same period last year.

Lotte ON is strongly driving vertical expansion by unveiling the advertising campaign 'Shopping Fantasy ON' featuring Lee Hyori as the model on the 4th of last month and launching On & The Club the following day. The Lee Hyori Effect began right from the early stages of the campaign. The main advertisement video surpassed 2 million views within a week of its release, and the number of mentions of Lotte ON on social media and other online platforms approximately doubled compared to before the advertisement was aired. Currently, the combined views of the teaser and main videos have exceeded 11 million.

After drawing attention with the Lee Hyori advertising campaign, the virtuous cycle strategy of expanding loyal customers through the integrated membership On & The Club has proven successful. On & The Club is a membership that unites customers from On & The Beauty, On & The Luxury, On & The Fashion, and On & The Kids. It expanded from the previously operated beauty-only membership 'On & The Beauty Club' to four verticals, adopting a method of continuously attracting customer interest by unveiling new benefits every month. Currently, a 'payback' event is underway where customers receive a portion of the purchase amount as L.POINTs when buying popular products from each vertical service. An event offering 30% of the purchase amount back in points for luxury brands such as Gucci and Isabel Marant saw all prepared products sold out within two minutes.

Lotte ON has been employing a strategy to grow volume by leveraging verticals while also maintaining profitability. Through this approach, operating losses up to the third quarter this year (64 billion KRW) were reduced by more than half compared to the same period last year (132 billion KRW). Sales also increased by 25.9% to 97 billion KRW. Lotte ON expects that the meaningful changes starting from the expansion of On & The Club membership will lead to increased sales not only in Lotte ON verticals but across the entire platform. Lotte ON stated, "Since sales expansion follows the increase in membership numbers, we are placing our hopes on further sales growth by the end of the year."

Advertising campaign "Shopping Fantasy ON" featuring singer Lee Hyori as the model [Photo by Lotte ON].

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