[Report] Capturing Gangnam's Wealthy District... Lotte Super's Ambitious Project Filled Only with Food Items

Lotte Super 'Grangrocery Dogok Branch' Opens
First SSM Specialty Grocery Store
Deli Food Display Area Doubled Compared to Before
Considering High-Income Residential Area... Premium Fresh Food and Alcohol Also Enhanced

Dogok-dong, one of the representative affluent neighborhoods in Gangnam-gu, Seoul. As we reached the entrance of a residential-commercial complex apartment housing about 400 households along the road connecting Dogok Station and Maebong Station on Subway Line 3, a green signboard fluttered at the entrance. It announced the opening of the corporate supermarket (SSM) 'Grand Grocery Dogok Branch,' which had completed its renovation on the 21st under Lotte Mart·Super. After entering through the underground entrance, passing stores such as a hair salon, clothing, and jewelry shops, we arrived at the entrance of Grand Grocery Dogok Branch, which spans 1,600㎡ (approximately 484 pyeong). At the opening time of 10 a.m., employees were busily arranging products and preparing to welcome customers.

On the 21st, customers are shopping at Lotte Super Grand Grocery Dogok Branch, which reopened after renovation. Provided by Lotte Super

From Cooking Kitchen to Buffet and Side Dishes All in One Place

The first products that caught the eye were fruits. The shelves were filled not only with familiar varieties such as apples, persimmons, pineapples, oranges, and strawberries but also imported tropical fruits rarely seen in the market, such as durian, dragon fruit, and avocado. In the adjacent refrigerated corner, packaged fruits cut into portions for one- or two-person households were also displayed. Although it was early morning, the store quickly became crowded with customers pushing carts and filling them with groceries. Meanwhile, the voices of employees announcing sales on pasture eggs and seafood echoed throughout the store.

The corner where visitors stopped was the 100㎡ (about 30 pyeong) 'Deli Island,' which handles ready-to-eat (deli) foods. It is a place where 'Cooking Kitchen,' a ready-made food corner offering gimbap, sushi, chicken, etc., 'Cooking World Buffet,' which offers small-portion meals, and the premium side dish corner 'Dosigokgan' are gathered. In a small space next to the display case, chefs were making and packaging 16 types of sushi on the spot using ingredients such as flatfish, salmon, shrimp, and eel. A Lotte Super official explained, "To preserve the authentic sushi feel, we prepare it fresh on-site using fresh ingredients and use paper containers. Sushi accounts for more than 25% of total deli menu sales, showing its high popularity."

Grand Grocery Dogok Branch is a renewal of the first Lotte Premium Food Market introduced by Lotte Super in 2016, targeting the top 30% income bracket. Grand Grocery means a grocery specialty market that solves consumers' food concerns. At the end of last year, Lotte Mart Eunpyeong Branch, a large supermarket, was transformed into the first Grand Grocery store, and Dogok Branch is the first Lotte Super store to apply this concept.

Kang Seong-hyun, CEO of Lotte Mart·Super, said, "As the number of single-person households and the aging population increases and the number of family members decreases due to a declining birth rate, we expect demand for shopping at smaller stores rather than large discount stores to increase, so we applied the Grand Grocery concept to the super format for the first time. Our goal is to solve consumers' worries about 'what to eat today' by offering products that can be eaten immediately without separate cooking."

Kang Seong-hyun, CEO of Lotte Mart and Super, is visiting the newly renovated Lotte Grand Grocery Dogok branch on the 21st, inspecting the sushi corner. Photo by Kim Heung-soon

Double-Sized Deli Corner... Targeting Affluent Customers in Their 50s

Grand Grocery Dogok Branch offers about 5,000 grocery items, approximately 30% more than other Lotte Super stores. The deli food display area has been expanded to twice its previous size, and the number of related products has increased by about 30% to 200 items. In addition to premium side dishes, lunchbox menus with home-cooked meal-level taste and quality are displayed daily with changing selections. Middle-aged and older female customers who visited the store actually put not only daily necessities but also sushi and ready meals that can serve as a full meal into their carts.

Additionally, the 'Daily Meal Solution' corner, specialized in ready meals, has more than doubled its selection of frozen ready meals. In line with the healthy pleasure trend of enjoying health, there is also a corner featuring low-sugar or high-protein ready meals. For the first time at Lotte Super, the 'K-Street Food' section sells about 30 planned products in collaboration with famous domestic eateries such as Miminee Tteokbokki and Goraesa Skewered Fish Cake. The former coffee shop space has been replaced by 'Bottle Bunker Select,' showcasing about 800 types of carefully selected wines and liquors.

On the 21st, customers are shopping at Lotte Super Grand Grocery Dogok Branch, which reopened after renovation. Photo by Lotte Super

Attention is focused on whether Grand Grocery will boost the profitability of Lotte Mart·Super. Lotte Mart's operating profit for the third quarter of this year was 45.1 billion KRW, down 11.6% from the same period last year, and sales decreased by 4.9% to 1.4421 trillion KRW. Lotte Super's third-quarter operating profit also fell 11% to 12.3 billion KRW, with sales dropping 3.6% to 334.5 billion KRW. However, Grand Grocery Eunpyeong Branch, the first Grand Grocery large supermarket, showed potential with sales rising about 10% from January this year to the 19th compared to the same period last year.

The reason Lotte Super selected Dogok Branch, the third-largest store in total sales, as the first Grand Grocery SSM store is its geographical advantage. A Lotte Super official explained, "Due to the high rent in the area, there are no large supermarkets or other SSMs within a 500m radius, and there is a large customer base aged 50 and over with high income and purchasing power, so we believed it would be sufficiently competitive." The store's location near schools, academies, and offices also ensures solid demand from younger customers seeking ready meals.

CEO Kang said, "Through Grand Grocery Dogok Branch, we will provide differentiated supermarket services to customers and take a step forward as the 'Number One Grocery Market.' We plan to add related stores while conducting precise analyses of commercial districts in the future."