Retailers turn their eye to the solitary consumer
According to the government’s 2015 Population and Housing Census, 5.2 million people lived alone last year, and 27.2 percent of all households were single households. People who live alone currently make up the biggest segment of the population, and the number is expected to rise up to 30 percent within 10 years.
The demographic changes have given rise to new consumption patterns in the Korean market. Because those who live alone also eat alone, play alone and shop alone, traditional retail models no longer work.
The single people in their 20s and 30s who lead the new trend do not believe in mass production and mass consumption but demand new products that meet their personal styles. Since they are willing to spend their money only on items that satisfy their taste, new products and services are revolving around their needs and wants. Single people are reshaping the market and evolving into so-called power solos.
One of many new businesses established with power solos in mind is a small-scale house moving service jointly developed by e-commerce operator Auction and moving company Zim Car. The new service was created after the companies realized that people with small loads still had to pay the same price as bigger households because conventional moving services were made with families in mind.
Focusing on single people, the service offers two options for load up to 0.5 tons and load up to 1 ton. The average weight of load for a family of four is around 5 tons.
Multifunctional furniture has also gained popularity. Customized for single people, the pieces are designed to do more than just save space.
“As power solos usually live in single rooms or small houses, they prefer furniture that utilizes the space efficiently,” said a spokesperson from furniture maker Hyundai Livart. “Popular products include a dressing table that also functions as a drawer, wardrobe and hanger all at the same time.”
Tables for one at restaurants are also very common nowadays. The food industry is coming up with new menus specifically for solo diners and providing closed single-occupancy spaces.
CJ Foodville’s Cheiljemyunso, a Korean restaurant chain, has developed a single-person menu for shabu-shabu, a Japanese hotpot dish usually served communally. In a space provided for solitary customers, the restaurant has small pots filled with small amounts of ingredients that are sent on conveyor belts to be freely picked up by diners.
Jaws Food has come up with a dish set containing small amounts of tteokbokki (rice cake in red pepper sauce), sundae (Korean-style stuffed sausage) and Korean tempura, so anyone who orders on their own can also have a little taste of different menus.
McDonald’s is also quickly jumping on the trend by creating a space for solo visitors in its new branches, which it has already implemented at its Hongdae and Itaewon branches in Seoul. “These visitors like to use their laptops and internet while eating, so we provide free Wi-Fi services as well,” a McDonald’s staff member said.
Liquor businesses have slimmed down their drinks for those who like to drink on their own, and who drink lightly at home. As demand for small-quantity drinks rises, Diageo Korea, the country’s top whisky seller, released a smaller version of its Johnnie Walker series packaged in 200-milliliter (6.7 fluid ounce) bottles early last month.
Lotte Liquor launched a new product called Scotch Blue Highball in July. The drink’s low alcohol content of 7 percent, with the convenience of a 375-milliliter aluminum can, seeks to popularize whisky among light drinkers.
“One upon a time, whisky was a symbol of extravagant meetings, but their sales are expected to drop after the Kim Young-ran Law [the country’s new antigraft law] kicks in,” a business insider said. “The new changes in the market will be set around single-person households and domestic consumption.”
Sales of so-called home meal replacements, full ready-made set meals, are also increasing at a significant speed. According to the Korea Agro-Fisheries & Food Trade Corporation Education Center, the home meal replacement market made just over 800 billion won ($726 million) in 2011 but grew to 1 trillion won in 2013 and 1.7 trillion won in 2015. The forecast for this year is 2.3 trillion won.
In-house labels of the country’s largest retail conglomerates, such as E-Mart’s Peacock, are currently leading the market, but other companies such as CJ Cheiljedang, Dongwon and Ourhome are seeking to join the race.
Ingredient suppliers of home meal replacement producers have also embraced the good news. CJ Freshway’s sales hit 9 billion won in the first half of this year, 25 percent higher than the same period last year.
“We expect this year’s sales to hit 18 billion won by the end of this year,” Yoo Tae-woo, chief of the sales and planning team, said. “Dining out is slowly losing popularity, but the home meal replacement market is getting bigger because households are getting smaller. The food resource distribution market will also rise [with the increase of single-person households].”
Convenience stores are filled with products targeting single-person households, including fruits and snacks. CU has launched a product called “a cup of fruit, sweet/sour mix,” essentially a cup of fresh fruit cut into edible sizes.
Meant for people who find it difficult to finish the full boxes of fruit normally sold at grocery stores, the product saw sales go up over 40 percent in August since its release in February.
GS25’s ice mango and ice pineapple sticks, cut into edible sizes, are also very popular among customers. The frozen products saw over three million packs sold, making it to the convenience store chain’s list of top hits.
Vegetables and meat typically sold in quantities based on a family of four are now sold in smaller amounts for single-person households. Such offers include a cut of hairtail and half a mackerel. Packs of “easy vegetables,” washed and cut to their appropriate size, contain ingredients that a person can use to make a dish.
Competition is now all about getting power solos to open their wallets. Large grocery stores, in an effort to attract consumers away from convenience stores, have also extended sales of home meal replacement products and small packaging of fresh ingredients.
BY HUR JEONG-YEON [firstname.lastname@example.org]