At a department store in Ho Chi Minh City, Vietnam, shopping continues after business hours end four times a year. It is a special event where the store reopens its doors for top-tier customers. Revenue generated from these four annual events accounts for more than 10% of the department store’s annual revenue. At a large supermarket in the same city, Korean Shine Muscat grapes are prominently displayed at the entrance, and food items and dining spaces are provided so that customers can have both lunch and dinner there. This is how Lotte Department Store and Lotte Mart open the wallets of Vietnamese consumers.
◇ VIP shopping continues even after closing… Four events account for over 10% of annual revenue
Lotte Department Store Diamond Plaza branch, located in District 1, a central commercial area of Ho Chi Minh City. At the entrance to the “Diamond Lounge” on the third floor, a staff member was chatting with a customer about shopping. Inside, customers were seen relaxing while enjoying drinks and snacks. Equipped with private rooms and a hall, this is an exclusive space accessible only to top-tier VIP customers. Korean-style excellent customer management, which even takes care of customers’ birthdays, was being carried out for Vietnamese consumers as well.
Korean-style VIP management, unfamiliar in Vietnam, has recently begun to yield results. The VIP special shopping event, where only VIP customers are allowed entry until 11 p.m. after regular business ends, is held only four times a year, but the scale of consumption is so large that it accounts for more than 10% of this branch’s annual revenue. Park Un-eung, team leader at Lotte Department Store Ho Chi Minh City branch, said, “We manage approximately 1,000 top-tier VIP customers,” adding, “The contribution is high not only in terms of revenue but also operating profit.”
Local customers also highly rated the department store’s luxurious atmosphere. A Vietnamese customer met at the store said, “Lotte Department Store feels more luxurious compared to other department stores,” and added, “It is popular locally because you can also buy Korean cosmetics.”
The Diamond Plaza branch is about 4,500 pyeong in size, smaller than large domestic department stores, but it has achieved results by concentrating on brands preferred by local high-income earners. In particular, the first floor prominently features a luxury concept store of about 200 pyeong and global premium cosmetics stores such as Chanel. It attracted Jo Malone and Diptyque, which had not previously entered Vietnam, in addition to Korean high-end cosmetic brands like Sulwhasoo and The History of Whoo.
On the third floor, they created Ho Chi Minh City’s largest golf specialty space. Korean fashion brand “Hazzys” is also popular here. Team leader Park said, “Hazzys is recognized as a high-end brand locally,” and explained, “Customer preference is high even at prices higher than in Korea.”
Food and beverage stores were also differentiated. They prepared a restaurant space of about 700 pyeong and a terrace garden of 400 pyeong, including TWG Tea and Starbucks Reserve, providing dining and resting spaces to keep customers lingering in the department store.
◇ Korean Shine Muscat at the entrance… “Tteokbokki and kimbap, nice.”
The fresh food section on the first floor of Lotte Mart South Saigon branch, located in District 7 of Ho Chi Minh City. The first thing that caught the eye at the entrance was a local customer selecting Korean Shine Muscat grapes. While Chinese Shine Muscat grapes, commonly seen in Vietnam, are sold for 50,000 to 60,000 dong, Lotte Mart prominently featured Korean grapes that are more than twice as expensive.
Park Dong-hwan, Product Strategy Director at Lotte Mart, said, “Korean products are an important differentiating factor for Lotte Mart,” and explained, “We emphasize the premium image of Korean products rather than price competition.”
Going deeper into the store, Vietnamese customers were busy choosing menus in front of “Yorihada Kitchen,” where kimbap, tteokbokki, bulgogi bento boxes, and dakgangjeong (crispy fried chicken) were displayed. In addition to Korean food, it is characterized by creating an atmosphere where local foods can be enjoyed together with Vietnamese-style fried rice, pho, and sushi.
In the dining area, a considerable number of customers were heating up purchased food in microwaves for meals. Vietnam is a country with a developed culture of eating out and consuming ready-to-eat foods. A customer met on site said with a smile, “I often come here because I can heat up and eat the food I buy,” adding, “I like tteokbokki and kimbap.”
In the daily necessities section on the second floor, customers were looking at Lotte Mart’s private brand (PB) products. One male customer held clothes against his body several times. There were also reactions like, “The fabric seems good.” Director Park said, “In Korea, there is not much popularity for fashion PBs, but this place is different,” and added, “They prefer cost-effective PBs centered on fashion and daily necessities.”
in LIVING
