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Shopping sector scrambles to welcome Chinese shoppers following visa-free policy
7-Eleven earlier this month launched a promotion for users of WeChat Pay, a popular payment method for Chinese consumers. Courtesy of 7-Eleven
By Ko Dong-hwan
Duty free shops, retail stores boost services, convenience
Korea’s shopping sector is preparing to welcome Chinese tourists as the government’s visa-free policy for Chinese nationals goes into effect on Sept. 29, raising anticipation for a stronger influx of visitors to Seoul.
Businesses are introducing new payment methods and product lineups to better cater to Chinese tourists. The companies, understanding that the domestic market alone is not enough to sustain their businesses, are betting big on the foreigners who have long been major customers here.
Under the visa policy, Chinese nationals in tour groups of three or more people can visit Korea without a visa and stay up to 15 days. The policy is set to be in place until June 30 next year. With China’s National Day and Mid-Autumn Festival falling within the statutory holiday period of Oct. 1 to 8, the policy is expected to widely open the doors for Chinese visitors to the Korean market.
One of the most popular shopping sectors for international travelers is duty free stores. Four major Korean firms in the sector, three of which saw operating deficits in the second quarter, are desperate to raise sales. A smaller number of inbound Chinese tourists contributed to declining spending at the stores.
Shilla Duty Free, in collaboration with its Chinese subsidiary, is planning large-scale consumer events for K-pop fans to encourage their visits to Seoul. Lotte Duty Free, the only company in the sector that didn’t record an operating deficit, earlier this month visited Guangzhou and Qingdao to sign a memorandum of understanding with local travel agencies to promote itself to potential visitors.
Kinetic Ground inside the Lotte Department Store branch in Seoul's Myeong-dong draws customers' attention to Korean fashion brands in this September photo. Courtesy of Lotte Shopping
Shinsegae Duty Free last month exclusively invited over 1,100 VIP customers of Yili Group, the largest dairy product company in China. The duty free firm has also partnered with New Oriental Education & Technology Group, a major online education platform company in China, to invite 300 employees to its store through next month.
With these programs, Shinsegae Duty Free plans to draw 60,000 Chinese shoppers to Seoul within this year.
Major department stores and convenience stores have also introduced new services to boost convenience for Chinese shoppers.
Lotte Department Store said on Wednesday it will launch a discount promotion for Alipay users beginning Friday and continuing until Oct. 11, and will launch another promotion for WeChat Pay users from Sept. 25 to Oct. 12. The company is also hosting a goods giveaway promotion at Kinetic Ground, an in-house platform dedicated to Korean fashion brands, for Chinese shoppers.
“The visa-free policy for Chinese group visitors will likely contribute to a spike in the number of foreign customers at department stores here during the remainder of this year,” said Park Sang-woo, head of Lotte Department Store’s marketing strategy division.
Major convenience store brand 7-Eleven last month launched a coupon promotion for WeChat Pay users in collaboration with Lotte Duty Free. The promotion runs until the end of next month. The company last month also launched automated kiosks for currency exchange, prepaid payment card sales and public transit fare recharging inside stores at tourism hot spots.
“We signed the partnership with WeChat Pay as we expect the number of Chinese visitors to Korea to surge this year,” said Eoh Dong-joon from the marketing division of Korea Seven, which runs the convenience store brand.