Media watch: South Korea happily takes over as brands leader

Screen shot of Gucci catalogue

A Jan. 14 article on the Chosun Online website revealed that South Korea has overtaken China as the luxury brand capital of the world in terms of consumption. Citing data compiled by investment bank Morgan Stanley, the news service noted that in 2022 Koreans purchased $16.8 billion worth of so-called luxury brand merchandise, which is the equivalent of about ¥2.15 trillion. That comes out to $325 (¥42,000) per capita, which clearly outstrips the next highest purchasing country, the United States, at $280, and China, the previous leader, at about $50. China’s plunge is pegged to several factors, most notably the change in circumstances brought on by the pandemic and various economic restrictions implemented by the government. 

What’s noteworthy about the Chosun story is the comment that Koreans are buying more luxury goods than ever because they want to “promote their social status as individuals” and “[Korean] society accepts the appeal of showing off one’s wealth” more than societies in other countries. These conclusions were based on a survey of worldwide consumers conducted by McKinsey Consulting about attitudes toward luxury goods. When they asked people whether they had a negative view of the use of luxury brands, those who said “yes” accounted for 38 percent of Chinese respondents, 45 percent of Japanese, but only 22 percent of Koreans. 

In any event, the article goes on to say that most luxury brands have reinforced their sales activities in Korea in a big way and quoted several fashion houses. The Italian label Moncler said that their sales in Korea actually doubled during the pandemic, while the Richemont Group, which owns Cartier, revealed that from 2021 to 2022, Korea was the only market where sales grew by “double digits.” Prada’s overall sales decreased by 7 percent in 2022 simply due to China’s anti-COVID measures, but was almost made up for by an increase in Korean sales. 

This success is mirrored by the recent rapid increase in brand ambassadors who are Korean celebrities. Lisa of the girl group Blackpink now represents Celine, while her bandmates Jennie, Rose, and Jisoo shill for Chanel, Yves St. Laurent, and Dior, respectively. Big Bang star and top music producer G Dragon also fronts for Chanel, while Kai of the group EXO is there for Gucci. Fendi gets double duty from international pop star Jackson Wang, who is a Chinese national but launched his career as a member of the K-pop group GOT7. And while the list of ambassadors seems top heavy with pop stars, quite a few actors have been tapped, as well. 

Consequently, worldwide luxury brands have embraced Korean culture, though sometimes in questionable ways that can backfire. In a Jan. 5 article, Hankyoreh news service reported that Gucci recently produced a T-shirt with the brand’s name emblazoned in hangul characters that is only sold in Korea. It costs the equivalent of ¥90,000. Some Koreans reacted negatively, saying that selling an exclusive piece of apparel in Korea with hangul writing was pretty cheap looking, more like a knockoff than anything else. Wouldn’t it make more sense to market this overseas among non-Korean people who could find some kind of hip cachet in hangul? Some internet commentators wondered if Gucci was, in fact, making fun of Korean consumers, while others just assumed Gucci was overestimating Koreans’ obsession with luxury goods. In any case, the anecdote just goes to show that foreign brands still may not really understand the Korean market.

This assumed affection for luxury brands seems to contradict much of what we’ve observed in at least one corner of Korean pop culture. A vital theme at the moment in K-dramas and Korean movies is class distinctions that manifest as fraught interpersonal relations, especially TV series that highlight class differences in romantic relationships. Even more than the class warfare that was the bedrock appeal of Parasite, these dramatic presentations use class differences as the main theme, and while characters representing the richer layers of society are not always depicted negatively, when they are their social status is broadcast by their preference for designer brands. It should be noted that TV dramas in Korea, by law, do not have commercial interruptions, and so production companies pay for series with product placements, which can sometimes be hilariously obvious. We just wonder if luxury brands are cool with this kind of promotion, which sounds as if it could be self-defeating. However, according to the Chosun article it doesn’t appear to be a contradiction for Korean consumers.

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2 Responses to Media watch: South Korea happily takes over as brands leader

  1. jdm says:

    moncler
    not montclair

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