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Lotte Duty Free World Tower will become a leading attraction for international visitors, says Lotte Duty Free CEO Hong-Kyun Lee |
SOUTH KOREA. Lotte Duty Free today presented to international media its 10,990sq m duty free store at the vast Lotte World Mall, part of the 123-storey Lotte World Tower in the Jamsil district of southern Seoul.
The 428,934sq m Lotte World Mall is one of three buildings surrounding the 555m skyscraper – still under construction – that together make up the largest retail and entertainment complex in the country. Highlights include a 29,800sq m store from Avenuel, Lotte’s upscale department store brand; Lotte Cinema, said to be the largest theatre complex in Asia with 21 screens and 4,600 seats; an aquarium with 650 marine species; and Star Avenue, an interactive space dedicated to Korean wave stars (also Lotte brand ambassadors).
The Lotte Duty Free World Tower store, covering the top two floors of the Lotte World Mall, officially opened last week on 16 October. It replaces the Lotte World outlet, located at the 10th floor of the Lotte Department Store adjacent to the Lotte World theme park.
In the four days since its opening, Lotte Duty Free World Tower has welcomed over 3,000 shoppers and average sales per day have increased by more than +20% compared to the previous Lotte World outlet.
Journalists from Korea, China and Japan – as well as The Moodie Report* from the travel retail channel – were invited to a press conference at Lotte Hotel World today for a media presentation of the project, led by Lotte Duty Free CEO Hong-Kyun Lee and Marketing Division Managing Director Bo-Joon Kim.
Speaking at the press conference, Lee described the opening of the Lotte Duty Free World Tower outlet as a stepping stone for the company into the global rankings of duty free retailers. Offering 420 brands, the store is claimed to be the largest duty free store in Korea, the second largest in Asia (after China Duty Free Group’s Haitang Bay International Shopping Complex) and the third largest in the world (following T Galleria Hawaii by DFS). It also boasts the largest offering of Korean beauty brands in Asia.
“By leading in attracting foreign tourists, we will help to drive the local economy and promote local brands,” Lee said. “We will focus our capabilities and efforts to make Lotte Duty Free World Tower a representative duty free shop in Asia, putting shopping and tourism culture together.”
To celebrate the grand opening of Lotte Duty Free World Tower, the company is offering customers a chance to visit the world’s seven tallest landmarks: Burj Khalifa (Dubai, UAE), Taipei 101 (Taiwan), Shanghai World Financial Center (China), Petronas Towers (Kuala Lumpur, Malaysia), Willis Tower (Chicago, USA), International Finance Centre (Hong Kong), and Tokyo Skytree (Japan). To participate, customers simply have to spend US$1 and fill out the coupon for the lucky draw. Seven winners will be selected – one for each landmark – and each prize includes airfare, hotel accommodation and an entrance ticket to the building. The contest runs until 27 November 2014.
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L-R: Lotte Duty Free’s Marketing Division Managing Director Bo-Joon Kim, CEO Hong-Kyun Lee and Merchandising Division Managing Director Joon-Soo Kim at the press conference |
HIGHLIGHTS
Product assortment: Lotte Duty Free World Tower features a wide array of Korean and international brands. Product categories include fashion and accessories (making up 26.7% of the product mix), perfumes and cosmetics (36.7%), watches and jewellery (15.6%), liquor and tobacco (9.7%), and others (electronics, packaged foods, souvenirs, etc. making up 11.4%).
Cosmetics and fashion, huge draws for Chinese tourists, are major focuses. According to Lotte, sales of Korean cosmetics to foreigners have grown exponentially, from 8.5 billion KRW in 2010 to 12 billion KRW in 2011 (+41%), hitting 19.1 billion KRW in 2012 (+59%). In 2013 sales surged to 39.4 billion KRW, representing growth of +106%. To cater to this demand, Lotte Duty Free World Tower is offering 140 brands in what is said to be the biggest Korean cosmetics zone in Asia. In addition, Korean fashion brands occupy +120% more space here than in the previous Lotte World outlet.
Korean beauty and cosmetics brands here include Tony Moly, Etude House, Innisfree, Iope, Laneige, Skin Food, Nature Republic and The Saem. Korean fashion accessory brands present include J.estina, MCM, Helianthus, Black, Lapalette, Softbag, Louis Quatorze and Youk Shim Won.
Korean delicacies such as red ginseng and kimchi add to the local flavour.
International brands are given larger spaces to shine – Cartier’s luxury boutique here is the biggest in Korea – while the fashion category (particularly shoes and clothing) has been extended. A stretch called “˜Watch Road’ showcases luxury watch brands including Omega, Rolex, Franck Muller, Piaget, Chopard, Longines and IWC.
There is also a new wedding gift shop for soon-to-be-married couples, a men’s zone for young men aged 20-30; a baby zone featuring early childhood products; and an organic products zone.
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The beauty zone is characterised by wide walkways and bright lighting |
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The Korean cosmetics zone, said to be the biggest Korean beauty offering in Asia, is doing roaring business with Chinese tourists in particular |
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International beauty brands are also represented strongly with a powerful array of personalised branded spaces |
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Lotte Duty Free has dedicated +120% more space to Korean fashion brands than at its old Lotte World store |
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The ‘New Wave, New Shopping’ visual identity is exclusive to the Lotte World Tower outlet |
New visual identity: Lotte Duty Free has partnered New York-based brand consulting firm Lippincott to create a visual identity exclusive to the World Tower outlet. The concept, “˜New Wave, New Shopping’, is a reflection of the company’s aim to create a “˜New Wave’ environment and a “˜New Shopping’ experience. The main visuals recreate the light movement of fabric and are featured on all shopping bags, coupons, direct mailings and other marketing material.
Commenting on the new identity, Lippincott Creative Director of Asia Vincenzo Perri said: “It’s inspiring and dreamy, like a beautiful sunset or gorgeous flowing hair. [Like] a new way of shopping, everything flows and connects gracefully and beautifully.”
Store design: To create a feeling of spaciousness and better flow in-store, the ceiling height is set at 3.4m – 1.3 times higher than in conventional stores, said Lotte. The company has doubled its investment on store design, finishing materials and other high-end features, including high-definition LED screens which the new identity. Lotte Duty Free models, scenic views and tourist spots.
Lotte Duty Free has also dedicated more space to its customer lounge and information desk areas. The information desk caters to locals and foreigners separately, ensuring speedier service. Toilets and elevators have also been expanded.
To ease traffic congestion around the area, the company is offering parking space for tourist buses, allowing twice as many buses to park as at the old Lotte World branch.
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South Korean actor Kim Soo-hyun joins Lotte’s stable of Korean wave brand ambassadors, starring in the company’s new campaign at Lotte World Tower |
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Some of the world’s leading fashion brands have a reinforced presence in Lotte Duty Free World Tower; Chanel and Louis Vuitton are also found on the lower levels of Lotte World Mall |
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The luxury boutiques are complemented by a selection of watches, sunglasses and fashion accessories including Sisley |
Star Avenue and the Korean wave: Described as a “must visit” for foreign tourists, Lotte Duty Free brings its famous Star Avenue to the World Tower outlet. The multimedia interactive space features Korean Wave stars Kim Soo-hyun, Lee Min-ho, Jang Keun-suk and 34 other Lotte Duty Free brand ambassadors. Visitors can take photos with life-sized figures of these celebrities and play games.
To commemorate the launch of Lotte Duty Free World Tower, a teaser and promotional video clips of Kim Soo-hyun have been produced and uploaded on various social networks including YouTube.
From 16 October 2014 to 15 January 2015, customers who spend more than US$1 can participate in a lucky draw to win 40cm figures of Kim Soo-hyun, Lee Min-ho and Jang Keun-suk. Life-sized figures of the same three stars are being offered for purchase at US$50,000 each, with part of the proceeds going to charity.
Limited Kim Soo-hyun and Lee Min-ho card mirrors as well as EXO watches have been produced as gifts for visitors, and a Kim Soo-hyun tumbler will be given as a GWP for purchases above US$600.
To celebrate the opening of Lotte Duty Free World Tower, the company will host its 19th Family Concert from 7-9 November at Seoul’s Gymnastics Stadium Olympic Park. Tickets will be given to customers who purchase over US$700 worth of goods at Lotte Duty Free’s stores at Lotte World Tower, the company’s main store in downtown Seoul, COEX Mall, Incheon International Airport, and Gimpo International Airport.
The concert, open to foreign tourists only and limited to 12,000 guests, will feature performances on 8 November from Lee Seung-chul, Baek Ji-young, K.Will, and Every Single Day; and on 9 November from EXO-K, Epik High, A Pink, Akdong Musician and GOT7. Lee Min-ho will host a fan meeting on 7 November.
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The “˜Watch Road’ ends in a cul-de-sac where an expanded information desk and customer lounge – key to Lotte’s strategy for providing better customer service – is located |
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Swarovski, Montblanc and Tumi are among the fashion jewellery and accessory brands here |
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High-definition LED screens playing Lotte-branded video content are found on the Star Bridge (above), with a huge 3x2m display overlooking the escalators |
Strategy to attract foreign tourists
In an effort to boost the Jamsil Special Tourist Zone – the fifth and largest designated tourist zone in Seoul which covers Lotte World, Seokchon Lake, Bangi Matgol and Seoul Olympic Park – Lotte Duty Free is targeting to attract three million visiting customers with its new Lotte World Tower outlet. The company expects that this will generate over 90 billion KRW, reaching 200 billion KRW by 2018. Compared to the previous Lotte World branch, the new outlet should generate over 100 billion KRW in additional value.
To achieve this goal, Lotte Duty Free World Tower will partner overseas on-site travel agencies, host incentive tours and hold various cultural events such as Family Concerts, banking on its Korean Wave marketing.
Lotte Duty Free has hailed the success of its Korean wave marketing since it engaged South Korean actor Bae Yong-joon – star of the TV drama series Winter Sonata – as a model and brand ambassador. Winter Sonata, widely considered to be the Korean drama that launched the Korean Wave throughout Asia and worldwide, catapulted the actor to fame particularly with the Japanese.
To capitalise on the Korean wave, Lotte Duty Free has selected 34 Korean stars as brand ambassadors and actively marketed them, hosting over 30 fan meetings over the past three years. For its recent Family Concert held 29-31 August, about 20,000 foreign tourists including 15,000 Chinese traveled to Korea on 35 chartered planes and 350 chartered buses. This was, according to Lotte, the first time in Korea’s recent history (excluding official events such as the FIFA World Cup or the Olympic Games) that the country has hosted a foreign contingent of such size. The Family Concert generated an estimated 80 billion KRW, almost double the value of when travel agency Baojin Group hosted a tour group of 10,000 Chinese for four days and three nights.
Lotte Duty Free believes that its ‘Korean Wave Culture Campaign’ increases the revisit rate of travellers and has a positive effect on the South Korean economy. Hosting such events for the Chinese and Japanese VIP and travel agency package customers has proved successful in building loyalty, and the company estimates that it has attracted 40,000 tourists and achieved sales of 30 billion KRW through such concerts. It plans to draw 100,000 Chinese tourists over the next three years with this cultural strategy.
The company is also hoping to drive sales by catering to foreign demand for local Korean brands. About 45% of total retail area at the new World Tower outlet has been dedicated to local brands, 15 of which are new medium-sized companies. Due to a lack of brand awareness, these brands have been having difficulty pushing their products in spite of their good quality and design, and Lotte is putting in place a marketing strategy to promote them strongly.
*NOTE: The Moodie Report is on location in Seoul and will bring you a detailed addition to this preliminary report this week in The Moodie e-Zine.
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Star Avenue provides a space for fans of Lotte’s brand ambassadors to interact with their idols |
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Lotte Duty Free has launched several promotions to mark the opening of the new store, including lucky draws to win figures of Kim Soo-hyun, Lee Min-ho and Jang Keun-suk and a trip to visit the seven tallest landmarks in the world |
