Fashion Industry Competes to Attract Brands Amid New Luxury Popularity

Full Effort to Expand Overseas Brands... Fierce Competition to Capture MZ
Intense Discovery of New Brands Including Antenna Shop Strategy

The eleventh standalone store of the French designer brand Ami in Korea, opened at The Hyundai Seoul in Yeouido, Seoul. Photo by Samsung C&T Fashion Division

[Asia Economy Reporter Song Seung-yoon] Expanding overseas brands has emerged as a key topic in the fashion industry. As fashion companies actively expand their portfolios centered on so-called ‘new luxury brands’ that are highly popular among the MZ generation (Millennials + Generation Z), competition to attract brands is expected to intensify further.

According to the industry on the 21st, Handsome, a fashion specialist company affiliated with Hyundai Department Store Group, recently signed exclusive distribution contracts in Korea with three brands: American designer brands Gabriela Hearst and Veronica Beard, and Swedish fashion brand Tot?me. In August, Handsome also launched the Swedish designer brand Our Legacy, which is very popular domestically. On the 15th, Handsome opened Gabriela Hearst’s first standalone store in Asia at Hyundai Department Store Apgujeong Main Store. Tot?me plans to open stores at Hyundai Department Store Apgujeong Main Store and Trade Center Store in January and February next year, respectively. In March, the following month, a standalone Veronica Beard store will open at Hyundai Department Store Pangyo Store. Until now, these brands were mostly sold through select shops. Handsome plans to double the number of overseas fashion brands to about 20 by the second half of next year. Through this, it aims to grow overseas fashion sales to over 1 trillion KRW, more than twice the current scale, within five years.

The craze for attracting brands in the fashion industry was led by Samsung C&T Fashion Division. Samsung C&T actively increased the volume of overseas brands based on the success of new luxury brands such as Ami, Maison Kitsun?, Thom Browne, and Lemaire, which have established themselves in Korea. Samsung C&T Fashion Division’s sales in the third quarter of this year reached 471 billion KRW, up 25.6% from the previous year. Operating profit also rose 70.6% to 29 billion KRW. Cumulative sales reached 1.459 trillion KRW, a 17.7% increase compared to the same period last year. The strong sales of overseas brands supported this sales growth. These brands have been operated by Samsung C&T since the early 2010s after acquiring domestic distribution rights. Recently, they have focused on providing brand experiences offline, such as opening Ami’s eleventh standalone store in Korea at The Hyundai Seoul in Yeouido. They also plan to continue discovering luxury brands through their own select shops like Beaker and 10 Corso Como.

Shinsegae International is introducing Maison Margiela, Acne Studios, Marni, Alexander Wang, and others to the domestic market. Recently, it has been aggressively expanding its imported cosmetics business following fashion. Shinsegae International recently acquired the exclusive domestic distribution rights for Laura Mercier, a French luxury cosmetics brand widely known for color cosmetics. Prior to this, it also acquired the rights for the Italian luxury haircare brand Davines. Shinsegae International holds the rights to eight perfume brands, including Diptyque and Santa Maria Novella, representatives of niche perfumes, as well as Byredo, Memo Paris, and Ex Nihilo. It also holds rights to skincare brands such as Natura Biss? and La Bruket, and famous beauty brands including Herm?s Beauty, Hourglass, and Oribe. Shinsegae International plans to secure stable growth momentum by implementing a two-track strategy of building an imported brand portfolio and nurturing its own brands.

Kolon FnC recently officially imported the Italian luxury leather brand Valextra and introduced it to the domestic market. Kolon FnC previously secured exclusive domestic business rights for the French contemporary brand Iro Men’s and introduced the Italian premium brand Neil Barrett’s golf capsule collection to the Korean market for the first time, diversifying its overseas brand portfolio. LF is also expanding its portfolio by acquiring domestic sales rights for various imported brands such as Barbour and Pyrenex, following existing brands like Vince and Isabel Marant.

An industry insider said, "Fashion companies are putting great effort into attracting overseas brands because the MZ generation, the main customer base of the fashion industry, is enthusiastic about new luxury brands rather than domestic or traditional luxury brands," adding, "Competition among companies through new brand discovery strategies such as ‘antenna shops’ will become even fiercer in the future."