BUSINESS

Supermarket chains dominate offline shopping: report

By Kim Da-sol
  • Published : Mar 20, 2018 - 15:59
  • Updated : Mar 20, 2018 - 19:54

Scale continues to play a major part in attracting shoppers both online and offline, a recent survey showed, with supermarket chains and large open market platforms coming top in consumers’ preferred retail outlets.

E-mart's no brand store (E-mart)

According to a joint survey conducted by research firm Consumer Insight and Hanyang University’s retail research center, at least 80 percent of consumers said they went to supermarkets within the last month. The survey was conducted on some 15,000 Koreans from July 2017 to the end of January this year.

Convenience stores came in second at 68 percent, followed by local grocery stores (55 percent), brand stores (45 percent) and traditional markets (39 percent).

The report said 44 percent of the respondents said they generally tended to choose supermarket chains for offline shopping, while less than other offline shopping channels picked up shares of less than 10 percent each.

“Some of respondents said they visit supermarket chains because it is well-located and easy to find. Some of them also cited familiarity as another reason, because its category of products and even interior provide similar ambience throughout all chains,” said Jung Kyung-sik who participated in the study. 

E-mart, discount store chain under retail giant Shinsegae, currently operates 145 stores across the country, while Homeplus and Lotte Mart have 142 stores and 123 stores, respectively. 

In terms of customer loyalty, which the report calculated based on preference and actual use, supermarket chains topped the list at 55 percent, while department stores (17 percent) and midsize grocery stores (16 percent) operated by retail giants such as Shinsegae followed. Midsized grocery stores, also known locally as “super supermarkets,” are those between 1,000 and 3,000 square meters. 

“Supermarket chains are dominating offline shopping channels, while other shopping platforms such as local grocery stores, convenience stores and traditional markets are left as secondary options,” the report read. 

Meanwhile, among online shopping channels, customers used open markets the most, with 79 percent of shoppers having used one, followed by social commerce (51 percent), home shopping (35 percent) and individual retailers’ online sites (30 percent). 

Customer loyalty was the highest, again, for open markets at 64 percent, compared to other online shopping channels such as social commerce (35 percent) and online retailers (26 percent). Home shopping, duty-free stores and multiplex shopping malls showed low customer loyalty at 10 percent, 8 percent and 7 percent, respectively. 

“Competition in both offline and online retail industries is quite obvious, as supermarket chains are dominating offline shopping channels, while open markets are taking the lead in online shopping platforms. This structure is unlikely to change at the moment,” according to the report.

“Only the aggressive and creative online marketing strategies from social commerce and retailers’ online sites can change the situation for online shopping channels.”

By Kim Da-sol (ddd@heraldcorp.com)