Diversifying Distribution Channels: hy's Online and Offline 'Predit' Both '好好'

Strong Sales at 'Predit Shop' First Store Opened in September to Diversify Sales Channels
Online Mall 'Predit' Also Expected to Surpass 100 Billion Won in Sales This Year

The first 'Predit Shop,' a 24-hour unmanned store by hy, opened last September

[Asia Economy Reporter Eunmo Koo] Last year, hy, which declared its transformation into a comprehensive distribution company by changing its name from ‘Korea Yakult’ to ‘hy,’ is building achievements by diversifying its distribution channels through offline ‘Predit Shop’ and online mall ‘Predit’ while maintaining and strengthening sales through ‘Fresh Managers,’ well known as the traditional ‘Yakult Ajumma.’

According to the industry on the 10th, the first 24-hour unmanned store Predit Shop, which hy opened at the end of September, is generating daily sales of around 1 million KRW.

Predit Shop is hy’s first offline store, planned to expand contact points with customers who usually find it difficult to meet Fresh Managers face-to-face. The first store, Yangcheon Branch, is located in Sinjeong-dong, Yangcheon-gu, Seoul, and sells about 200 popular hy products including dairy products, meal kits, and salads. To assist reasonable purchasing, product ratings and reviews from the online mall Predit are displayed on electronic price tags.

hy expects that Predit Shop will also contribute to increasing the income of Fresh Managers. Since it is an unmanned store where payment is made via self-service kiosks, the display and management of the store are handled in rotation by Fresh Managers responsible for nearby areas, who receive commissions based on sales amounts. As additional income can be generated, the demand and preference for store management tasks among Fresh Managers are reportedly sufficient.

Since the first store is achieving results beyond expectations, hy plans to gradually increase the number of stores as part of expanding new distribution channels. However, as it is still in the early stages, rather than aggressive expansion, the priority will be given to areas around hy’s agencies where management is easier, and discussions on the scale of expansion and store locations will continue.

The online proprietary mall Predit is also accumulating concrete achievements. Predit, an integrated online platform selling health functional foods, dairy products, home meal replacements (HMR), fresh foods, daily necessities, and cosmetics, is expected to exceed 100 billion KRW in sales for the first time this year, growing more than 40% compared to last year. Predit’s predecessor, ‘HiFresh,’ started with sales of 7 billion KRW in 2017, steadily growing to 52 billion KRW in 2020 and 70 billion KRW last year. The number of members nearly doubled to about 1.2 million as of the first half of this year, compared to 650,000 in 2019.

In April, hy introduced the AI marketing solution ‘Groovy’ to Predit. As the proportion of online transactions continues to increase, hy is fostering its own mall to directly collect and process customer data and utilize it for personalized product recommendations and other methods to drive sales growth of the channel. In addition, excellent online-offline linked services such as fast free delivery through the existing Fresh Manager distribution network also appear to be contributing to Predit’s growth.