Han Moon-il, CEO of Musinsa, "2024: The First Year of Offline Expansion... Expanding to 30 Stores"

Aggressive Expansion of Offline Stores
Aiming to Create New Demand with High Market Potential
Enhancing Awareness and Accessibility through Offline... Expecting Online Synergy

MUSINSA is accelerating its offline business by expanding its private brand (PB) 'MUSINSA Standard' offline stores to 30 locations by next year. Since the offline market still holds significant market potential, MUSINSA plans to create new demand through this channel while enhancing the customer experience for existing online consumers, thereby simultaneously raising brand awareness and competitiveness.

Han Moon-il, CEO of Musinsa, is presenting Musinsa's offline business strategy at a press conference held on the 16th to commemorate the opening of Musinsa's offline flagship store in Hongdae.

MUSINSA Standard to Expand Offline Stores to 30 by Next Year

Han Moon-il, CEO of MUSINSA, stated at a press conference held on the 16th at 'MUSINSA Terrace Hongdae' in Mapo-gu, Seoul, ahead of the opening of the offline flagship store 'MUSINSA Hongdae', “We have an aggressive offline expansion goal to increase the number of offline stores of our private brand 'MUSINSA Standard' to 30 by next year,” adding, “In the long term, we plan to balance the business ratio between online and offline, aiming for about half each.”

Starting as an online platform, MUSINSA entered the offline business in 2021 by unveiling 'MUSINSA Standard Hongdae' for the first time. Since then, following the Gangnam store last year, stores have been consecutively opened in Daegu and Seongsu this year, with a fifth store set to open in Busan Seomyeon by the end of the year. Considering this, the plan is to open more than 25 new offline stores within next year alone.

According to CEO Han, most of the new stores to be established next year will be located outside Seoul. Taking into account that offline stores serve as both sales expansion bases and marketing assets, the company plans to consider regions that can overcome the limitations of marketing activities concentrated in Seoul. Furthermore, instead of operating through the traditional road shop model by leasing stores in general commercial buildings, MUSINSA plans to pursue operations in collaboration with existing distribution channels such as department stores and shopping malls.

However, MUSINSA takes a cautious approach to expanding offline stores for its curated shops. CEO Han said, “It is still difficult to make a clear judgment regarding MUSINSA curated shops,” adding, “We will review the performance of the three stores, including the Seongsu store to open next year, before considering the next steps.” The first MUSINSA curated shop offline store opened last month in Daegu, with the second store opening near Hongdae Entrance Station on the 17th. The third store is scheduled to open in Seongsu around March to April next year.

Offline Market Potential Remains Strong... Opportunity to Acquire New and Foreign Customers

The fundamental reason behind MUSINSA's accelerated expansion into offline is the market potential of offline stores. According to Statistics Korea, as of last year, the retail sales amount in the fashion category was approximately 133 trillion KRW, more than twice the online shopping sales amount of 52 trillion KRW. Despite this market potential, MUSINSA believes there is currently no offline curated shop in the domestic fashion market that gathers a wide spectrum of brands in one place to present to customers.

CEO Han said, “Although the online fashion retail market has grown rapidly in recent years, the offline market size is still larger,” adding, “We believe we need to provide value in the offline area to customers who want to experience and shop offline.” He also noted, “At the Gangnam store last year, quite a few customers were not MUSINSA members,” emphasizing that offline has value as a marketing strategy to attract new customers or foreign customers who have not experienced MUSINSA before.

Additionally, MUSINSA sees offline store operations as a way to strengthen synergy with its existing online business. CEO Han emphasized, “Securing customer data is becoming increasingly important for the company,” adding, “By analyzing detailed purchase histories, we can better understand customers and provide them with greater value.” He also mentioned that offline stores serve as sales channels and showrooms for tenant brands to promote their growth.

Interior view of Musinsa Hongdae offline flagship store

Differentiation Through Same Pricing Online and Offline

MUSINSA cites providing the same customer experience online and offline as the biggest differentiator for its curated shops. Unlike typical fashion stores that operate different pricing policies online and offline due to various factors such as labor costs, logistics, and rent, MUSINSA allows any member to purchase products at the same price both online and offline.

CEO Han said, “Customers look at clothes offline and consider not only the price but also how best to wear them, searching for ideas,” adding, “Improving this experience is a meaningful innovation, so we plan to differentiate ourselves through pricing policies and enhanced content such as styling.”

Furthermore, MUSINSA plans to actively discover new brands to enhance competitiveness as an online and offline fashion store. Initially, it will continue early-stage investment and incubation to help promising emerging and small designer brands grow systematically. For brands in the growth stage requiring scale-up, MUSINSA will provide sales expansion opportunities through personnel and infrastructure support and offer consulting based on its know-how to support long-term growth.

In particular, MUSINSA plans to focus its capabilities on discovering even newer and fresher brands. It is pursuing the direction of directly developing high-sensitivity rising brands that are not well known domestically. Through MUSINSA Trading, which specializes in domestic and international fashion brand distribution, it will also expand exclusive domestic launches of overseas brands such as 'Noah'.

At the same time, MUSINSA will lead efforts to discover collaborative products and brands utilizing intellectual property (IP) from fashion, art, tech, celebrities, and creators. It also plans to support launching new high-sensitivity brands by collaborating with capable creative directors.

CEO Han said, “Through the MUSINSA Hongdae and Daegu offline flagship stores, we will maximize online and offline synergy to provide the best experience to customers and accelerate the growth of tenant brands,” adding, “We plan to showcase trendy, high-sensitivity brands that can only be found at MUSINSA in offline spaces and support the overseas expansion of domestic designer brands.”

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