Four Department Stores Compete in the 10 Million Customer Market of Gyeonggi Nambu

Lotte Department Store Dongtan Branch Entry with Hyundai, Shinsegae, and Galleria
Expanding Luxury Brands and Renovating Food Halls... Transportation Accessibility Also Key

[Asia Economy Reporter Jo In-kyung] As Lotte Department Store plans to open a new branch in Dongtan, Gyeonggi Province next month, competition among the four major department stores targeting the southern Gyeonggi area is expected to intensify. In response to Lotte Dongtan Store's declaration as the 'largest scale in Gyeonggi Province,' Hyundai, Shinsegae, and Galleria are each strengthening their luxury goods and food halls.

Competition in Food Halls and Luxury Upgrades

On the 21st, Lotte Department Store announced that it is planning the Dongtan branch as the largest department store in Gyeonggi Province, focusing on luxury, living, and kids categories to propose a high-quality lifestyle. It will introduce 'new luxury' brands favored by young customers in their 30s and 40s with young children, as well as specialized overseas fashion apparel stores.

The Italian luxury brand Moncler will open its first total flagship store in Korea, including men's, women's, and kids' lines, and the French luxury brand Saint Laurent will also open a full-category store for men and women. The entire basement level 1, which is the size of 2.5 soccer fields (18,000㎡), will be developed as a food hall called 'Food Avenue,' hosting about 100 famous restaurants nationwide.

Hyundai Department Store Pangyo branch has adopted a premium strategy based on the affluent 'young and rich' consumers working in nearby IT companies. It already houses a Louis Vuitton store, one of the 'big three' luxury brands, and Hermes is scheduled to open next year. Shinsegae Gyeonggi branch also recently reopened its food hall on a large scale, offering specialized services tailored to customer preferences and demands in sections such as meat, cooking, and health. It will also launch the industry's first paid membership service exclusively for the food hall. Galleria Gwanggyo branch is focusing on attracting VIP customers based on luxury brands like Gucci, Prada, and Dior.

Growing Southern Gyeonggi Retail Market

With the boom in new town development, Shinsegae Department Store (Gyeonggi branch in 2007), Hyundai Department Store (Pangyo branch in 2015), and Galleria Department Store (Gwanggyo branch in 2020) have successively entered the southern Gyeonggi area. They have competed targeting areas such as Bundang, which is already in the settlement phase, as well as Pangyo, Wirye, Yongin, Suji, and Gwanggyo, but since all are located within a 10 km radius, they have effectively been competing within overlapping commercial zones. Although relatively smaller in scale, Lotte has operated Bundang and Suwon department stores, Lotte Outlet Gwanggyo, and Lotte Mall Suji, while AK Department Store Bundang branch and complex shopping facilities like 'Avenue France' and 'Alleyway Gwanggyo' have continued to open.

An industry insider said, "Large department stores have opened around Pangyo, Jukjeon, and Gwanggyo, but with the expansion of new towns, rapid population growth, and the relocation of major corporations, the demand for newer and more upscale shopping facilities continues. Especially, last year Hyundai Department Store Pangyo branch achieved 1 trillion KRW in sales in the shortest period of 5 years and 4 months since opening, proving the growth potential of the southern Gyeonggi market," he evaluated.

The key factor that will determine the competition among the four department stores is transportation conditions. Since the marketability of the areas where each department store is located is sufficient, customer attraction will vary depending on how good the accessibility is. Poor accessibility could result in losing customers to department stores in Seoul.

Lotte Department Store Dongtan branch expects to secure a dominant position in southern Gyeonggi once the transportation environment is completed, including the current SRT and the future opening of GTX (Greater Seoul Metropolitan Area Express Railway). The strategy is to expand the customer base not only in Dongtan but also to nearby Yongin, Suwon, and Anseong, extending throughout southern Gyeonggi. A Lotte Department Store official said, "There are no department stores yet in areas south of Gyeonggi such as Osan, Pyeongtaek, and Anseong, so we see high growth potential for the Dongtan branch."