By Yoon Ja-young
Department stores and other retailers are offering discount events to boost sales, but too frequently such events make consumers doubt their sincerity. Analysts warn that they may be hurting their brand value in the long run while sales will be boosted for only a short period.
Lotte Department Store, for instance, held numerous sales events this year. Starting with its New Year’s Sale in January, it ran a spring sale, summer sale and fall sale. It also organized the Black Shopping Week Sale, Black Super Shopping Sale, and Black Friday Sale. More recently it launched K-Sale Day. Lotte Department Store has held sales this year for more than 100 days so far.
Hyundai Department Store also held a New Year’s Sale, three seasonal sales, and a 44th anniversary sale, with the number of sales days also totaling over 100. Shinsegae Department Store is no exception, with total sales nearing 100 days.
The sales have helped boost sales.
Hyundai Department Store had a sales increase of 8.7 percent in October thanks to the government-led Korea Black Friday Day sales event, which compares with an average monthly sales increase of between 1 and 3 percent this year. Shinsegae Department Store also recorded nearly a 20 percent sales increase during the Black Friday event, which prompted it to organize the K-Sale Day event.
However, as sales are held too frequently, some consumers are starting to shop less at department stores.
Kim Yun-young, a housewife from Ilsan, Gyeonggi Province, said she never shops at department stores except for the discount sales events. “They offer discounts every month. If I purchase something at a normal price, I am afraid that it might be a rip-off.”
She also wondered if department stores may be getting too much of a margin in their sales. “If they can offer 50 percent discounts so often, why don’t they pull down the normal price on the tag? I think that would be better for consumers.”
As department stores face the “shopper cliff,” in which the number of shoppers drop sharply after the end of a sale, analysts advise that they need to be more skillful in organizing sale events.