Masks off and spending up as consumers revert to pre-Covid lives

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Masks off and spending up as consumers revert to pre-Covid lives

Published: 19 Apr. 2023, 16:23

Consumers pick out products in the cosmetics section of a department store in Seoul on Sunday. [NEWS1]

The first maskless spring since the Covid-19 pandemic has led consumers to open up their wallets to spend more on cosmetics, clothes, travel and dining.

After the lifting of the mask-wearing mandate on Jan. 30, consumers have been picking up the pieces of their lives from before the Covid-19 pandemic, and sales related to cosmetics, beauty, travel accommodations and dining out are going up, according to a report from the Bank of Korea on Wednesday. Spending rose as cities resumed their cultural events as social distancing measures have all but lifted, the central bank said.

As to-be-wed couples roll out their wedding plans which were delayed during the Covid-19 pandemic, sales of furniture and household products for newlyweds are on the rise as well this year.

Based on the first quarter this year, spending on Shinhan Card rose 6 percent on year, and rose 3.7 percentage points compared to the fourth quarter last year. The report said increased spending was largely influenced by people's activities as they step away from the "untact" lifestyle.

Sales of cosmetics rose 27.56 percent on year during the annual spring discount event held at Lotte Department Store, Shinsegae and Hyundai Department store.

None of the three department stores disclosed the specific sales figures from the event period.

During the promotion, overall sales at Lotte Department Store increased 10 percent on year, while sales of makeup jumped 30 percent.

For Shinsegae, overall sales rose 9.8 percent while sales for cosmetics rose 25.1 percent.

Hyundai Department Store’s sales for makeup rose 27.6 percent, followed by furniture sales which increased by 25.4 percent and children-related products by 14.2 percent. Overall, sales during the promotion period rose 10.6 percent on year.

Sales for products related to leisure and sports activities also increased due to the increase in outdoor activities with the onset of warm weather. Lotte Department Store’s sales for leisure and sports each rose 15 and 10 percent on year. For Shinsegae Department Store, products related to outdoor activities rose 18.8 percent, and sports rose 10.6 percent.

Despite increased sales, the overall sales growth compiled from the three department stores slowed compared to the first quarter of last year, when sales rose 20 percent on year during the spring promotion period. The rise in last year's figure is due to the increased foot traffic as social distancing measures were relaxed slightly from mid-April.

The retail industry worries that comparing the sales only by figures may lead to a negative base effect.

Department stores are eagerly rolling out new promotions ahead of May, which is known to be a month for families, with Children’s Day on May 5, Parents’ Day on May 8 and Teachers’ Day on May 15.

Shinsegae will extend its spring promotion until April 27 in hopes of consumers opening their wallets for the upcoming month, while Lotte Department Store will launch a promotion for beauty brands from April 28 to May 14, distributing gift cards and coupons. The department store is scheduled to hold separate discount events for wellness and home appliances next month as well.

“May through August is considered to be the busiest season for department stores, with holidays and summer vacations coming up,” said a spokesperson from the retail industry who wished to remain anonymous. “The early arrival of spring and the warmer weather are leading to an increase in sales, and we hope to continue to attract more customers with our trendy promotions.”

BY LEE SU-MIN, LEE JAE-LIM [lee.jaelim@joongang.co.kr]