Brands in Korea cater to customers by offering a full experience offline
“Don’t sell products. Sell the experience.”
Many brands today are taking this motto to heart. Until around three or four years ago, along with the rise of online commerce, most brands wanted to prove themselves as innovative, scrambling to enhance their online presence and sometimes withdrawing from brick-and-mortar stores. Now, their next biggest task is to come back with new and improved offline spaces catering to MZ generation (millennials and Generation Z) customers. Brands are focused on creating a space that will primarily attract consumers, then make them stay long enough to become a fan of the brand itself.
This approach isn't a turn away from digitalization; it’s just that the MZ generation, emerging as the new generation of customers, grew up in the digital age and rather find these so-called analog experiences to be novel. They’re all about experiencing new things — seeing, touching, hearing, tasting and feeling them. Offering such experiences is a way for brands to promote themselves to up-and-coming customers. Offline spaces that reflect the brand’s culture and identity in elaborate ways are appearing one after another.
Dior Seongsu opened on Sunday in Seongsu-dong, eastern Seoul. Dubbed a “concept store,” it is set to operate for six months only. The difference between this and Dior’s flagship store in southern Seoul’s Cheongdam-dong is that Dior Seongsu specifically targets the MZ generation. From the overall interior design to the details of the smallest utensils, every element of Dior Seongsu reflects the luxury fashion house’s aesthetic. It has a simple cafe inside, as well as a media art wall recreating Christian Dior’s beloved rose garden and other collaborative works with young artists.
Louis Vuitton will also operate its own pop-up restaurant Pierre Sang at Louis Vuitton from May 4 to June 10 on the fourth floor of its Cheongdam-dong flagship store. The restaurant will offer dishes by Korean-French chef Pierre Sang Boyer, known for adding Korean spices to French cuisine.
“In the industrial age, brands appealed to consumers with the quality of their product, and in the Information Age, with images,” said Professor Kim Joo-yun of Hongik University’s industrial design department. “Now, they appeal to the consumers’ hearts and emotions through experiences. Offline spaces are the core of the this new branding strategy.”
“The way brands form relationships with customers has drastically changed,” said Lee Keun-sang, head of the advertising and marketing firm KS’IDEA. “In the past, a brand would send one-sided messages to consumers via television and advertisements, asking them to ‘love me.’ But the MZ generation prefers two-way communication. Today, brands are saying, ‘I made a playground with all this content. Do you want to visit and see what I have to offer?’ Consumers then visit voluntarily and share their experience with others online, since many of these spaces are very ‘Instagrammable.’”
The offline spaces are distinguished from regular stores, as their main purpose is not to actually sell the brand’s products.
“It’s more of a display of the brand’s aesthetics, vibe and values,” Lee continued. “When consumers empathize with that, their bond with the brand grows stronger than it would from simply buying products. They become part of a fandom.”
Gucci opened its contemporary Italian restaurant Gucci Osteria Seoul on March 28, located on the sixth floor of its flagship store Gucci Gaok in central Seoul. It’s the fourth Gucci Osteria to open following branches in Florence, Beverly Hills and Tokyo. The eatery embodies the Gucci style with furniture and utensils from the brand. Items on the menu range from 28,000-won ($22) burgers to 170,000-won seven-course meals, but all reservations are full until mid-May. People visit not necessarily because the restaurant is known for its food, but to experience dining in a space filled with the luxury brand’s aesthetics — an experience you can’t get in any other restaurant.
Other fashion houses have been jumping on the bandwagon, opening food and beverage spaces. High-end watch brand IWC opened its first coffee shop Big Pilot Bar in the Lotte Department Store in central Seoul’s Myeong-dong last July, with an interior inspired by its signature piece, Big Pilot’s Watch.
Another, the A.P.C. Café, opened in the Lotte Department Store in Dongtan, Gyeonggi, last August and offers exclusive merchandise like t-shirts, cups, candles and thermos containers designed in the fashion brand’s style.
In February, luxury watchmaker Breitling opened the Breitling Townhouse Hannam in central Seoul — with a boutique and cafe on the first floor and the brand’s first-ever restaurant Breitling Kitchen on the second, allowing consumers to “experience everything about Breitling in one building.”
“Visiting a cafe or restaurant like that is a great gateway to the luxury brand, since it’s much more affordable than buying their actual products,” said designer Teo Yang. “Those spaces can show what the brand is all about through the furniture, utensils, staffs’ apparel and attitude. It’s a strategy to draw people in and turn them into future customers.
“People usually don’t visit [high-end] fashion stores too often, perhaps about twice a year when a new season is in,” he said. “But people visit cafes and restaurants very often. It’s an opportunity to become familiar with the brand in everyday life.”
But the trend is not limited to luxury brands. Lotte Confectionery’s Ghana Chocolate opened the Ghana Chocolate House in Seongsu-dong in April, which is set to operate until May 12. The pop-up store offers chocolate beverages and desserts, DIY chocolate-making lessons from professional chocolatiers and merchandise inspired by the brand. A giant chocolate bar-shaped wall is a popular spot for social media photo ops.
Fashion shopping website Musinsa opened its flagship store Musinsa Standard in Hongdae, western Seoul, last May. The store offers try-on services and is also linked with the Musinsa online store to offer pick-up services. It attracted 80,000 visitors in the month of its opening; 240,000 people from January this year to March. There are 23,000 pick-ups a month on average, making up 17.9 percent of the offline store’s entire sales.
On the 17th floor of AK Plaza Hongdae, Musinsa also runs the 2644-square-meter (28,460-square-foot) Musinsa Terrace. The various brands available on Musinsa’s online mall can display their own content through showcases, presentations, exhibitions and performances in the area, and sell items offered exclusively at Musinsa Terrace.
Even brands that have already established success online are launching offline spaces to meet customers directly. Connecting the online and offline spheres to create a new experience is the priority task for many brands today. Only having a presence in one sphere is not enough for survival. The fashion e-commerce giant is also set to open Musinsa Terrace Seongsu in May, with a cafe and showroom. The cafe will work with brands and change its interior design, concept and menu based on each collaboration, aiming to attract customers with an ever-changing cafe experience.
The times have even reached the point of visitors going to a bed brand’s pop-up store with no beds, and a soju brand’s store with no alcohol. Simmons opened a grocery store-themed pop-up space dubbed Simmons Grocery Store Cheongdam in February, which quickly became an Instagram hot spot. The best-selling product at the pop up store of Simmons, a brand known for selling beds with price tags of up to 30 million won, is a 5,000-won dishwashing sponge in the shape of samgyeopsal, or pork belly.
“How many times do people buy new beds in their lifetime?” asked Kim Sung-jun, director of Simmons’ brand strategy team. “So it’s important to maintain a consistent fandom, not just sell products. To build an MZ generation fandom, it’s been effective to create places that are good to take pictures at — something they love to do — without being too serious. Once we create a space like that, they can consume our culture before they consume our products, and they do eventually buy products someday.”
Beverage company Hite Jinro, known for its soju, opened Dukkeop Sanghoe (which translates to ‘Toad and Co.’), inspired by its toad mascot. But the soju company’s pop-up store sells no alcohol at all. Instead, it sells various merchandise featuring Jinro’s toad mascot. The quirky-looking toad gained popularity among young people for its cute appearance and was behind Dukkeop Sanghoe’s successful operations in 10 cities across Korea. The pop-up store is now open in Seomyeon, Busan.
“Companies’ emphasis regarding their stores shifted from making a lot of sales to attracting a lot of visitors,” said researcher Jeon Mi-young of Seoul National University’s consumer trend center. She added that although high-end brands have joined the trend and are targeting MZ generation consumers, the strategy is not only about those young customers, who have relatively low purchasing power.
“They’re potential customers of the future,” she said. “But another big reason is that Generation X [the generation after baby boomers], the ones who currently have the most purchasing power, want to feel connected to the young and trendy MZ generation. They don’t want to be associated with their parents’ baby boomer generation. So although a lot of these marketing strategies are aimed at Generation MZ, there’s a ripple effect and we can see that actual sales increase among Generation X.”
BY SEO JEONG-MIN [email@example.com]