At the Seoul Emart Seongsu branch's Chuseok gift set store, promotional assistants are showcasing Chuseok products such as lotus leaf Buse Gulbi and steamed Buse Gulbi. Photo by Mun Ho-nam munonam@
[Asia Economy reporters Seon-ae Lee and Seung-jin Lee] As social distancing measures are strengthened, more people are choosing expensive Chuseok gifts instead of visiting their hometowns. In response, the Anti-Corruption and Civil Rights Commission has temporarily raised the gift price limit for agricultural, livestock, and fishery products under the Improper Solicitation and Graft Act (Kim Young-ran Act), prompting the distribution industry to adjust gift set prices and increase the proportion of premium gift sets.
On the 9th, the distribution industry quickly adjusted gift set prices after the Anti-Corruption and Civil Rights Commission raised the gift price limit for agricultural, livestock, and fishery products from the previous 100,000 KRW to 200,000 KRW. For example, a gift set priced at 220,000 KRW was discounted to 198,000 KRW to comply with the Kim Young-ran Act limit. The volume of gift sets priced between 100,000 and 200,000 KRW has also been significantly increased. A Lotte Department Store official explained, "Currently, 65% of gift sets in department stores are priced over 200,000 KRW, but some will be readjusted within the gift price range to make gifting possible," adding, "We expect the wider range of consumer choices to increase demand for high-priced gifts."
An Emart official said, "It is difficult to immediately change the composition of gift sets, but we are considering increasing the volume of gift sets priced below 200,000 KRW," and added, "In large supermarkets, gift sets priced over 100,000 KRW are classified as high-priced gifts, and we expect the number of consumers seeking high-priced gift sets to increase due to this measure."
On the 8th, the Anti-Corruption and Civil Rights Commission approved an amendment to the enforcement decree of the Improper Solicitation and Graft Act to raise the gift price limit for agricultural, livestock, and fishery products and processed products, considering the economic difficulties caused by the COVID-19 pandemic. Processed agricultural and fishery products are those made by processing agricultural and fishery products with more than 50% of the raw materials. Examples include red ginseng, salted seafood, and kimchi.
Meanwhile, premium gift sets priced in the 200,000 KRW range are also gaining popularity. The unprecedented non-face-to-face (untact) Chuseok has led to a significant increase in demand for Chuseok gifts instead of hometown visits. Major department stores and large supermarkets have increased the proportion of premium gift sets priced over 200,000 KRW by about 30% compared to last year.
Lotte Department Store expanded the volume of premium gift sets by more than 20% compared to last year. Emart also increased the volume of high-priced Korean beef sets priced over 200,000 KRW by 30% and expanded premium sets priced over 300,000 KRW from 9 types last year to 14 this year. An Emart official said, "Due to COVID-19, this Chuseok is expected to be a non-face-to-face holiday, so we have significantly expanded the volume of products priced over 200,000 KRW," adding, "We expect Korean beef sales to increase significantly."
This Chuseok, gift sets composed of hygiene products have appeared for the first time, attracting attention. Aekyung Industrial launched a set consisting of hand sanitizer, hand soap, and masks. Convenience store CU assembled gift sets including non-contact thermometers and portable sterilizers. LG Household & Health Care released Chuseok gift sets including hand sanitizers and masks. An LG Household & Health Care official explained, "This is the first time we have planned gift sets with hygiene products," adding, "We diversified the product composition so consumers can choose according to their needs."
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