Year-End Season Edition... Hotel Cakes Over 200,000 Won Sold Out

Mid-Range Products Disappear
Hotel Cakes Popular Despite High Prices
Large Marts' 9,980 Won Cakes Sell Like Hotcakes

Alluring Winter sold at Seoul Shilla Hotel. (Photo by Hotel Shilla)

[Asia Economy Reporter Lim Chun-han] Amid the recent persistent high inflation, mid-priced products are disappearing, and consumption polarization is becoming more pronounced. Ahead of the year-end, premium hotel cakes priced over 200,000 won have sold out, while more people are seeking cost-effective (performance-to-price ratio) cakes at large supermarkets and convenience stores.

On the 24th, the Seoul Shilla Hotel introduced three Christmas limited edition special cakes on the 1st: Alluring Winter, The Brightest Moment Ever, and White Holiday. These products are priced between 130,000 and 250,000 won. Among them, the most expensive Alluring Winter was produced in a limited quantity of 50 per season and early reservations were fully booked. Chosun Palace sold four types?White Tree Special, Merry Santa House, White Forest, and Sweet Snow?priced between 85,000 and 250,000 won. The highest-priced White Tree Special cake is already fully reserved.

The Grand Intercontinental Seoul Parnas released five Christmas special editions: Merry-Go-Round, White Candle, Snowball, Centennial Ganache, and Gingerbread House. The highest-priced cake is 200,000 won. Each was sold in a limited quantity of 30, and all were sold out in less than two weeks after release. This year’s hotel cakes raised prices compared to last year due to increased raw material costs but still maintain high popularity.

Mini Cake Bangbangduck sold at Emart. (Photo by Emart).

Large supermarkets are targeting consumers with low prices. Emart partnered with Shinsegae Food to launch the Bbangbbangduck Mini Cake at 9,980 won, selling over 15,000 units in three weeks. This accounts for nearly half of the cakes sold at Emart from the 1st to the 20th of this month. The product features high-quality Seolhyang strawberries and chocolate toppings shaped like the Bbangbbangduck character.

Lotte Mart conducted pre-orders for Christmas cakes from the 8th to the 14th, with bakery sales increasing by 20% compared to the previous year. Representative products include Christmas Stollen (14,400 won), Milky Strawberry (26,000 won), and Choco Tree Forest Ball (26,000 won). Homeplus also saw a 40% increase in pre-order sales of Christmas cakes from the 1st to the 14th compared to the same period last year. Montblanc Bakery sells eight types of cakes, including Very Merry White Christmas (17,010 won) and Classic Strawberry Fresh Cream (26,010 won).

Convenience stores are targeting single-person households. GS25 sells four types of mini cakes?Dore Dore Strawberry Santa Cake, Dore Dore Milk Cloud Cake, Dolce Choco Long Cake, and Blueberry Long Cake?priced between 5,900 and 6,500 won. Seven Eleven introduced Red-Haired Anne Egg Castella and Strawberry Roll Cake at 18,000 won. Emart24 launched Panettone and Pandoro, festive breads shared with family or given as gifts during Christmas in Italy, as unique products priced at 14,900 won.

Professor Lee Young-ae of Incheon National University’s Department of Consumer Studies said, “Disposable income decreases are immediately felt, but consumption changes lag behind. It is difficult to immediately change all past consumption levels, so people reduce spending in other areas and compensate by consuming during special seasons.” She added, “In economically difficult situations, mid-priced products disappear because they are both mid-range in price and quality, offering no merit to consumers. Therefore, companies tend to choose high-price policies, and this phenomenon is likely to continue for some time.”