Fall discounts set to spur demand
Last year’s grand sale, Korea Black Friday, also took place from late September to mid-October.
Retail companies, manufacturers and traditional markets will participate in the promotion. On Aug. 4, the ministry started receiving applications from companies who want to take part. It has received over one hundred.
Last year’s grand sale was labeled a success: quarterly sales of the 22 companies that participated increased an average of 20.7 percent year-on-year. However, the event was criticized by some consumers, who said the discounts overlapped with annual sales held by department stores.
Some critics said the grand sale’s effect on business was exaggerated.
“Even without the grand sale, an increase in private consumption around that time was predictable with the end of the outbreak of Middle East Respiratory Syndrome, and the sale was scheduled just before Chuseok, when consumptions reaches its high for the year,” said a source in the retail industry.
Reactions to the plan from discount chains and online markets are generally favorable. “For online shops, preparing for a national sale is easy because all we have to do is make changes on our website,” said a spokesman for Gmarket.
The website saw a 20 percent increase in sales during last year’s grand sale. E-Mart had a big success with sales of samgyeopsal (pork belly) at a 20 percent discount.
Department stores are expressing concerns about this year’s event after enduring criticism after last year’s.
“Certain products, such as luxury goods or cosmetics, never go on sale during the year, which is why a grand sale promoting ‘huge discounts’ can be a problem for us,” said one spokesman for a department store.
The big difference with the Korea Sale FESTA is the participation of manufacturers. Samsung C&T’s fashion division will give a 10 percent discount on some men’s clothes, accessories and Bean Pole Outdoor and Eight Seconds brands. Cosmetic brands by LG Household and Health Care will also be discounted.
Manufacturers of electronic devices are in the process of choosing products to be sold at discounts. Televisions, refrigerators, air conditioners and washing machines are said to be on the list of discount products from Samsung Electronics. LG Electronics also expressed an intention to participate, but hasn’t decided on specific details.
Additionally, the Ministry of Trade, Industry and Energy will hold a shopping festival at COEX in Samseong-dong from Sept. 30 to Oct. 3 called Enjoy! Korea Sale FESTA. The event will be divided into six sectors: brands, beauty, fashion, food, culture and tourism. Each sector will sell products, hold events or provide information relevant to their respective themes.
To publicize the opening of Korea Sale FESTA, a concert will be held on Yeongdong Boulevard in Gangnam-gu on Sept. 30. The concert will be aired in 120 countries to attract customers.
“Although the event is temporary, we view the decision as a positive move with private consumption being low for the last few months,” said Oh Jun-beom, a researcher at Hyundai Research Institute. “Nevertheless, the government should take fundamental measures to ensure stable net income, the greatest contributing factor for domestic demand.”
BY JANG JOO-YOUNG, SUNG HWA-SUN [firstname.lastname@example.org]