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Posted : 2010-07-30 19:56
Updated : 2010-07-30 19:56

Why are upscale stores in Seoul empty?


People walk pass flagship stores of luxury brands such as Gucci, Giorgio Armani and Cartier along Cheongdam Street, southern Seoul. Cheongdam is known as Seoul’s luxury street. / Korea Times file

By Cathy Rose A. Garcia
Staff Reporter

Major cities around the world have their own famous luxury shopping areas: Fifth Avenue in New York, Bond Street in London, Rodeo Drive in Los Angeles and Ginza in Tokyo.

Louis Vuitton, Gucci, Prada and other high-end deluxe brands have all established their flagship stores at these ritzy addresses.

In Seoul, Cheongdam is often touted as the city’s equivalent to Rodeo Drive or Bond Street, but is it really?

The stretch of road from the Galleria Department Store to the Cheongdam intersection is indeed lined with large Louis Vuitton, Gucci, Armani, Dolce & Gabbana, Prada, Cartier, Loro Piana and Ferragamo flagship shops.

The trend started during the boom years in the mid-1990s, when the luxury business really took off in Korea.

These upscale stores always have impressive facades, eye-catching window displays and stylish interiors. But it seems regardless of how beautiful a shop is, it is always nearly empty.

``It’s not always this quiet every day. It can also get busy in the late afternoons,’’ a female shop assistant said, looking almost apologetic for the empty Armani flagship store. It was 4 p.m. on a weekday, but there were no customers at the store except for this reporter.

A sales person from Louis Vuitton admitted the boutique does not have many shoppers during the week, but traffic picks up during the weekends.

For Baek Jae-moon, a 21-year-old student from Brandeis University, she prefers shopping at the Hyundai and Galleria department stores than at the flagship stores in Cheongdam.

``My mom and I always wonder why the luxury brands have big stores in Cheongdam, but no one shops there... We always shop at department stores because it is more convenient and all the famous brands are there in one place,’’ Baek said.

Importance of flagship stores

The establishment of flagship stores is usually a strategy employed by luxury retailers to boost its image in a foreign market.

Even if luxury brands have stores inside department stores like Lotte, Shinsegae, Hyundai and Galleria, there is nothing like having a standalone flagship boutique in Cheongdam to add more glamour and prestige to any brand.

The flagship stores in Cheongdam pale in comparison to the flashy, multi-storey flagship stores in Tokyo, New York and London.

Prada was the first luxury brand to open a flagship store in Cheongdam in 1997. The two-storey shop offers the latest Prada men’s and women’s ready-to-wear, bags, accessories and footwear collections.

``This store was the result of the strong interest shown in Prada by the local market and represents the start of the brand’s entry into the developing area of Asia,’’ a representative from Prada Korea told The Korea Times.

Across the street from Prada, the Gucci boutique is done in the brand’s signature deep bronze shade, while the Armani shop’s imposing cream colored stone facade only has a thin glass window running from top to bottom.

Typically, a flagship store offers the brand’s complete collection, from handbags to shoes, jewelry to clothes.

At the Louis Vuitton flagship, a doorman welcomes customers to the spacious and extravagantly decorated store. With the scent of fresh flowers wafting in the air, customers are presented with an extensive range of Louis Vuitton clothes, shoes, accessories, handbags and luggage. A young woman, a regular customer, was served a glass of Perrier, as she waited for the staff to fetch a coat in her size.

French jeweler Cartier opened its Cartier Maison flagship store, designed by architect David-Pierre Jalicon, last year. The building’s striking facade was inspired by the Korean wrapping cloth or bojagi, but inside it feels like a private mansion, with crystal chandeliers and plush furniture. VIP customers can take their time picking from Cartier’s extensive diamond jewelry and tank watch collection inside private lounges, while being served champagne.

While the lack of foot traffic can be a problem for the flagship stores, customers can bask in the undivided attention from not-so-busy sales staff.

``I don’t like department stores because it’s quite crowded. I prefer shopping here, since there’s not a lot of people and they give me more attention,’’ Lee Soo-jin, a 35-year-old housewife, said, as she browsed through the racks of 900,000 won dresses and 400,000 won shirts at the 3.1 Philip Lim flagship store.

But the quality of the shoppers can make up for the lack of quantity. As one shop assistant noted, ``We do have regular clients that tend to purchase more expensive items.’’

For newer brands, having a shop in a known affluent district like Cheongdam can create a halo effect. Affordable foreign brands like DKNY, Coach and Tory Burch, as well as Korean-owned brands like MCM and Louis Quatorze have opened flagship stores in the area, with the hope that the prestige of the other global luxury brands would reflect on them.

MCM Haus is one of the more eye-catching buildings in the area, with the exterior decorated by individually numbered brass plates on one side, and the colorful artwork of British artist Richard Wood on the other. The store’s interiors offer a tasteful backdrop for the entire range of MCM bags, luggage and accessories, including the exclusive line of pricey crocodile and ostrich handbags which run up to 14 million won each.

Most Korean shoppers still prefer buying luxury products at department stores for sheer convenience, but this does not diminish the significance of opening a flagship store for luxury retailers.

Chadha Radha, author of The Cult of Luxury, offers her own theory on why flagship stores have failed to attract many Korean shoppers.

``The answer lies in the breathtaking speed with which the luxe culture has spread in Korea. While legions of consumers are buying luxury brands, they don’t necessarily feel comfortable in the awe-inspiring atmosphere of the flagship stores. They flock instead to department stores,’’ she said, in her book.

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