Dear Korea CQ members,

On March 9th, at the Kuwaiti Ambassador’s residence, Daniel Mayran, Chairman of Bluebell Korea, gave a special lecture on ‘Future of luxury: Post-covid retail trends’

H.E. Bader Mohammad AlAwadi, H.E. Philippe Lefort, H.E. Chafik Rachadi, H.E. Hazem Fahmy, Daniel Mayran, Christian Marcos, Erwan Vilfeu, Brian Harris, Haelyung Hwang, Myungja Kim, Youngha Go, Haewon Park, Hongsuh Park, Ryan Lee, James Park, Joon-mo Kwon, Boyoun Choi, Choi Jungwha, Didier Beltoise, and Crystal Park attended.

H.E. Ambassador Bader Mohammad AlAwadi warmly welcomed everyone, and in honor of International Women’s’ day which was the day before, March 8, he gifted beautiful flowers to all the women present. Afterwards we watched a video that showed the beauty of Kuwait, shared good news of our members, and enjoyed a delicious Kuwaiti dinner specially prepared by the Ambassador.

After a delicious meal, the lecture ‘Future of luxury: Post-covid retail trends’ by Daniel Mayra, Chairman of Bluebell Korea started.

Chairman Daniel Mayran is the founder of the Luxury Business Institute (LBI), and also the Vice-President at the French-Korean Chamber of Commerce and Industry (FKCCI). He was also the former Managing Director Travel Retail in Asia as well as Executive Marketing Vice-President of Air France.

Through the lecture, members learned about how COVID has impacted Korea’s luxury market, and how it is expected to change.

After the lecture, members asked many questions, leading to a lively Q&A session.

We would like to thank Chairman Danial Mayran who gave an insightful lecture for members, H.E. Ambassador Bader Mohammad AlAwadi for inviting members to his residence for this wonderful forum, and to Ms. Haewon Park for gifting Genic’s Celderma Undermasks for all participants. We would also like to express thanks to all members who attended despite their busy schedules, as well as Crystal Park for her interpretation help.

Thank you.

Korea CQ MeeJung Kim

For more pictures, please click the link below:

https://photos.app.goo.gl/V4FQXdHXgKAaCzA98

“Future of Luxury post-covid retail trends” By Daniel Mayran, Chairman of Bluebell Korea

In the future, historical and economic accounts will describe a world ‘Before COVID’

During these first few months of the year, we are not interested in knowing how the world will ‘resume’ its old ways, but we urgently need to figure out how we will renew ourselves.

Another aspect of the consequences is the imbalance that the pandemic has created.

In the case of China, it has shown an industrial production surplus of 7.3% with, as its corollary, the failure of the global economy which finished 2020 with twenty trillion dollars of debt compared to what was recorded at the end of 2019.

The United States represent today 24% of the world economy, whereas it represented 40% a few decades ago.

This imbalance has certainly been accelerated by COVID and its mutants disrupting our daily life – economic balances in particular, and our consumption habits, especially in Asia.

Another consequence in consumption habits is the ban on foreign travel; especially in Duty Free shopping habits which represented 21 billion dollars in 2019 and which will have guided Korean consumers to buy from the Travel market.

As for luxury, it will also be subject to evolution, not only in terms of concept - by taking sustainability more and more into account - but also in terms of commercial strategies and in integrating new technologies.

Luxury is an exceptional product created by an exceptional designer and/or an exceptional craftsmanship that must be sold in an exceptional way if we start from this definition.

What could be the consequences of COVID 19 in the luxury market in Korea?

First, remember that without the quarantine requirement, we will have seen a very good level of consumption, especially in the luxury sector, since it is estimated that more than 30% of sales today are recorded in this sector.

In addition, I would like to remind you that Korea is one of the most connected countries, having created for several years relational habits to integrate digital and traditional face-to-face relations.

Nevertheless, the difficulties related to the global economic environment have and will have resulted in the decrease of traditional customers in the luxury market; which will inevitably lead to the well-known mechanism; less customers, but higher prices.

If we take into account the social structure of Korea and its maturity in the luxury culture, we can already anticipate that this sector will regain its original position; exceptional products for exceptional customers, but this time for customers with high purchasing power.

It is also worth noting that certain brands which do not belong to major groups have already filed for bankruptcy.

Another consequence would be that this price increase will force the brands to strengthen their commercial strategy, in particular with a marketing approach based on an e-commerce adapted to more select customers and a more sophisticated CRM (Customer Relationship Management) and also to the reinforcement of the quality of in-store service, both in terms of product knowledge and attention to the clients.

Finally, it should be noted that restructuring the luxury market will inevitably lead to the closing of points of sale in the very short term and eventually to reinforcing digital to the detriment of brick and mortar.

But this pandemic will also have two inevitable consequences:

One is a rise of sales in the ‘Premium sector,’ which will also undergo upheavals following the bankruptcy of some independent brands, and at the same time a strengthening of sales for those who have been able to resist and, in particular, by the transfer of certain customers who had access to the luxury sector.

The other one is the development of the so-called ‘Second Hand’ markets which are growing by more than 30% to reach 6 billion dollars in Korea. This market is supported by motivations, which are not only economic reasons but also by various implications such as loyalty to the brand, sustainability, the arrival of new customers in the market and the development of stores and new sites targeted to this market.

Going back to my definition of luxury, how it is an exceptional product created by an exceptional designer and/or an exceptional craftsmanship that must be sold in an exceptional way, how do we maintain an exceptional sale, both digitally and by welcoming privileged customers. It would most likely be the new challenge ahead of us, both in Korea and in the rest of the world.

Q&A