Koreans are ideal consumers of designer goods as a large part of the population willingly open their purses based on their belief that luxury items represent class and status, according to a team of panelists at a forum co-organized by the Asia Society Korea Center and Italian Chamber of Commerce in Korea on Tuesday.
“My first impression of Korea was that I called this a dream market where people are actually excited to purchase luxury products ― something that is now uncommon in Italy,” said TOD’s Korea country manager Giuseppe Cavallo.
|Giuseppe Cavallo (left), the country manager of TOD’S Korea, speaks at a forum on Korea’s luxury brand craze organized by the Asia Society Korea Center at a hotel in Seoul on Tuesday. (Park Hae-mook/The Korea Herald)|
He added that the purchasing power in Korea for luxury brands is mainly with the older, married women who are actually very conservative and that luxury is now a status.
This is because luxury goods, which once obtained their status through exceptional quality and stylish designs, are now being used as a measure of wealth for many, if not the majority, of Koreans.
Reflecting this phenomenon, luxury items are becoming more sophisticated in terms of trend and demand, according to Sophie Park, the merchandising team leader for Lotte Duty Free.
“More consumers look for unique, limited and rare luxury goods, which inevitably means pricier, and as a result the market for high-end luxury goods are soaring relative to the low-end or semi-luxury,” Park said.
She added that while women continue to be steady buyers, men too are now seeking and purchasing luxury brands.
Asia Society is a non-partisan, non-profit organization dedicated to promoting mutual understanding and strengthening partnerships among peoples, leaders and institutions of Asia and the United States in a global context.
The group has been hosting a series of monthly luncheons in cooperation with The Korea Herald, where leaders and experts from both the public and private sectors convene and discuss a broad range of issues from the fields of policy, business, education, arts and culture.
Tuesday’s luncheon was the second to last of the series, and the three panelists had been invited to discuss the Korean consumers’ inner motives for purchasing luxury brands.
The general consensus among the panelists was that there are definitely noticeable, and possibly problematic, patterns occurring in consumer behavior when purchasing luxury items.
“There is a societal aspect to this luxury craze as the higher class tries to distinguish themselves from the lower class and this sort of egalitarian system makes the lower class feel the need to keep up,” said Henry Shinn, a tbs eFM host and a member of Tuesday’s panel.
According to Shinn, Korean consumers buy luxury products for self-satisfaction and feel better about themselves and how they are perceived by others.
This is why luxury items are purchased, even by people who are unable to afford them. It also may be why Koreans are reticent to buy home-grown brands, even those that are globally considered “designer brands,” the panelists said.
The urge to feel special may even be associated to the reason why Koreans are so passionate about education and finding “respectable” jobs.
Just how Koreans feel about luxury goods are well illustrated in the fact that sales remain intact despite that the Korea-Europe FTA failed to sufficiently bring down prices.
“In Korea, everyone wants to be No. 1, which is impossible. Otherwise how many No. 1s will you get?” said Cavallo. “Luxury doesn’t mean trendy. It is completely different. We are already in the other stage where you can wear something trendy without it being expensive.”
By Kim Joo-hyun (email@example.com)