SEOUL – South Korea’s retail giants, Lotte and Shinsegae, are on a collision course over department store domination of Seoul’s Myeongdong district, racing to reinvent their retail strongholds to lure young, high-spending consumers.
As one of Seoul’s premier shopping meccas for locals and tourists from overseas, the district holds deep legacy for both department store giants – home to their first flagship stores – and offers opportunities to synergise their retail and accommodation businesses.
Lotte Department Store is set to shutter its youth-focused Young Plaza in Myeongdong for a sweeping renovation starting in April. It marks the first major overhaul since the plaza’s debut in 2003.
Staying true to its youthful identity, Young Plaza has consistently introduced trendy fashion brands and shops catering to younger tastes.
Central to the overhaul is the creation of a dedicated zone highlighting trendy Korean products designed to attract Gen Z shoppers from around the globe with a blend of fashion, food and beverage attractions.
The revamped plaza is also expected to create synergy with Lotte’s other department store buildings in the area, where renovation efforts are already afoot.
Lotte has been upgrading its main flagship department store since 2019 through phased renovations, introducing luxury fashion zones, gourmet food halls and sports and leisure areas.
In December 2024, it unveiled a newly renovated beauty hall on the basement floor – now the largest of its kind among department store chains in the country.
Later this year, Lotte plans to unveil a K-fashion specialty hall at its main branch, while its luxury annex, Avenuel, is also set to undergo its own makeover soon.
All of these efforts fall under a broader vision to bring new life to Lotte Town Myeong-dong, according to the company, via a grand plan to transform the area into an all-in-one urban shopping complex.
“Once the renovations are completed by the end of 2027, Lotte Town Myeong-dong will emerge as the premier shopping, tourism and cultural hub of northern Seoul,” a company official said.
Lotte’s bold strategy seems like a calculated move to counter Shinsegae’s move to broaden its retail footprint, also in Myeong-dong.
In terms of annual revenue last year, Lotte’s Myeong-dong branch outshines Shinsegae’s, ranking fourth nationwide with 2.05 trillion won (S$1.87 billion), while Shinsegae’s Myeong-dong store trails in tenth place with 1.19 trillion won.
In his New Year address, Shinsegae Department Store CEO Park Joo-hyung conveyed a clear ambition to turn the flagship store into a vast “townlike” shopping complex.
Shinsegae’s renovation push marks its largest makeover since opening its new wing, coming 12 years after its last major revamp.
The overhaul aims to lure high-spending consumers seeking luxury brands while also tempting consumers with an upgraded selection of dining options.
With the main building and the new wing focusing on luxury goods, fashion and dining experiences, the former SC First Bank building is being repurposed into a luxury boutique center slated to open early next month, according to the company.
“The new wing has been revamped by expanding its luxury and jewelry portfolio and introducing a range of popular dining establishments,” a Shinsegae official said.
“We plan to keep capitalising on our unrivalled brand competitiveness to deliver fresh shopping experiences to our customers.”
According to industry insiders, the rivalry between Lotte and Shinsegae underscores a broader trend in the retail sector, where the drive to offer exclusive, offline shopping experiences – the kind e-commerce platforms can’t replicate – is taking centre stage.
“With foreign tourists returning to Myeongdong, Lotte and Shinsegae are battling for the crown as the top retail destination,” a retail industry official said, adding that the success of their strategies could redefine department store playbooks in today’s post-pandemic retail landscape. THE KOREA HERALD / ASIA NEWS NETWORK
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