Big retailers offer deep discounts to win shoppers back
Large discount retailers are rolling out massive promotions for the weekend in a bid to attract customers back after coronavirus cash steered them toward local shops and mom-and-pops.
Items offered include household items and food, even Korean beef, which is hitting all-time highs as more people are staying home and cooking on their own. Loss leaders are a distinct possibility, as the retailers hope that customers once in the store will pick up items that generate better margins.
“Customers drawn in by discounted beef are likely to buy other products along with their visit. So for the retailers, it’s okay for them to sell meat with no marginal profit,” said an industry source. “Their goal is bringing back customers they lost after the government gave out coronavirus relief grants.”
In early May, the central government distributed coronavirus relief funds to everyone in the country in the hopes it would boost consumption and help local businesses. While small stores have benefited, large discount markets, such as Emart and Lotte Mart, did not, since the government limited the use of the funds to traditional markets and local businesses.
Lotte Mart, the Lotte Group's discount chain, said it will provide discounts of 8-billion-won worth of goods over the weekend. Among many items, Grade A Korean beef will be available at up to 50 percent off.
Face masks are also on the list. Lotte Mart said it secured two million masks, which will be sold at 500 won ($0.41) each. This is a third of the price of face masks sold under the public distribution system. The maximum number of masks available for each person will vary by branch.
“We selected products that can provide practical benefits to everyday life,” explained Choi Hoon-hak, the marketing director at Emart. “Our strategy is to stay true to our identity, offer quality products at affordable prices and eventually contribute to stabilize the lives of our customers.”
Emart said it will hand out discount coupons to visitors to some 131 stores, regardless of the amount purchased. A total of 400,000 coupons worth 2.9 billion won in discounts will be given out by the retailer.
Homeplus started offering discounts on meat starting Thursday, both offline and online. Beef and pork will be offered at up to 40 percent off until May 10. Fruits, home meal replacements, Korean traditional cold noodles, or naengmyeon, and sauces will also be offered at a discounted price.
The price of Korean beef is hitting new records every day. According to the Korea Institute for Animal Products Quality Evaluation, the retail price of 1 kilogram (2.2 pounds) of Korean sirloin beef exceeded 100,000 won for the first time in history, hitting 100,029 won as of Wednesday.
BY KANG JAE-EUN, KWAK JAE-MIN [firstname.lastname@example.org]