Sale Festa may actually work this year as sentiment jumps
More than 1,300 companies will give discount offers for the Korea Sale Festa event scheduled to run from Nov. 1 to 15 this year, with hopes the event will boost consumption and help businesses.
“We hope the Korea Sale Festa can bring life to Korea’s economy hurt by the Covid-19 pandemic,” said Kim Yeon-hwa, head of the event’s organizing committee, at an online conference Friday to promote the event.
The event is the largest in size since it first launched in 2015. A total of 1,328 businesses were signed up as of Oct. 21, almost double the total number of participants last year.
Discount offers of up to 60 percent will be rolled out across the board, by department stores, supermarkets, convenience stores, carmakers, e-commerce sites and even furniture stores.
A big goal of the event is to help regional markets and small businesses especially hard-hit by the pandemic. A total of 64 markets in 19 regions will give out government cash coupons for those who purchase above a certain amount.
Large retailers have rolled up their sleeves to help out small- and medium-sized companies. E-commerce sites like Coupang, Shinsegae’s SSG.com and 11st will hold special promotional events on products from such companies.
International customers can also join the event. Discounts and coupons will be available for overseas customers directly purchasing on platforms like Gmarket Global.
While the government hopes the event can become as popular as the Black Friday sales in the United States, that might be easier said than done, according to officials from the retail industry, due to Korea’s unique distribution channel.
“Korea Sale Festa has performed poorly every year,” said a spokesperson from one of Korea’s top department stores.
“Unlike the United States, where retail companies have ownership of pricing, Korean retailers do not. Even though we lower prices to razor-thin margins, it’s impossible to offer massive discounts like the ones people see in the U.S. Black Friday week.”
Its previous economic impact was smaller than expected. Consumer spending rose only 0.12 percent and the GDP increased by 0.06 percent in the fourth quarter of 2018. As criticism arose, the government handed the event to private companies for management.
This year the situation could be different, says government and companies, as they see consumer confidence growing in response to recent changes in social distancing rules.
“Since we are a week ahead of the event, now might not be the right time to predict the outcomes,” said an official from the Ministry of Industry at the press conference. “But the number of participants for this year grew, and, slowly but steadily, we are seeing a rise in consumer confidence. We are optimistic about this year.”
“The difference this year is that the government is sending positive messages about spending and promoting more people to shop. If the message goes through, it can help stimulate consumption,” said an industry source.
BY KANG JAE-EUN [firstname.lastname@example.org]