Junho Jung, CEO of Lotte Department Store,
calls executives after opening ambitious 'Kinetic Ground'
saying, "The kinetic element is lacking"
"The name is 'Kinetic,' so I think it would have been better to emphasize the kinetic aspect."
Junho Jung, CEO of Lotte Department Store, made this remark after touring the K-fashion specialty zone 'Kinetic Ground,' which was set up on the 9th floor of the Lotte Department Store Myeongdong Main Branch in Jung-gu, Seoul, summoning executives and staff to share his thoughts.
CEO Junho Jung expresses disappointment: "The kinetic element is missing"
According to industry sources on July 9, CEO Jung expressed his regret about the Kinetic Ground, which opened to the public on July 4, saying, "Young people like kinetic art, so we tried to capture that vibe, but it didn't really come through." He added, "Considering the age range of our customers, it would have been nice to have a kitschy touch, but it feels too restrained," and remarked, "It just seems like a collection of young brands."
Kinetic Ground is a new K-fashion specialty zone launched by Lotte Department Store targeting customers in their 20s and 30s. The space, approximately 1,800 square meters (550 pyeong), which is about a quarter the size of a soccer field, is filled with leading K-fashion brands. Fifteen K-fashion brands that are gaining attention both domestically and internationally, including 'Mardi Mercredi,' 'Matin Kim,' 'Koiseio,' and 'Trimming Bird,' have opened stores there. The space is divided into 'regular stores' and a 'popup store (Kinetic Stage),' and its interior is decorated with 'kinetic art.'
Kinetic art refers to artworks that move. By using metallic materials that shine or have a glossy finish, it creates a futuristic atmosphere, which has become popular among younger generations. For example, the fashion brand ADERERROR installed kinetic art pieces in the center of its Seongsu Space and designed the entire area with a futuristic concept, making it a hot place (popular spot) visited by many. Lotte Department Store has previously announced its ambition to make Kinetic Ground a landmark for the 2030 generation by bringing the vibe of Seongsu-dong into the department store.
Perspective rendering image of the popup space 'Kinetic Stage' within Kinetic Ground. Provided by Lotte Department Store
Department stores compete to capture the core MZ generation customer base
Recently, domestic department stores have been making every effort to attract the MZ generation, which has emerged as a core customer base. As the e-commerce market expands and the population ages, the number of consumers visiting offline stores has significantly decreased. As a result, the MZ generation has become the key customer group for overcoming the department store downturn.
In fact, Shinsegae Department Store opened the K-fashion specialty zone 'Hyper Ground' at its Busan Centum City branch in 2023, and within 100 days, sales of young fashion at Centum City increased by 75% compared to the previous year, while sales to customers in their 20s and 30s more than doubled. The name of the space combines 'Hyper,' meaning the best, and 'Ground,' meaning space, inspired by popular keywords at the time. Hyper Ground is divided into regular stores operating on a one-year basis and popup stores (Hyper Stage) operating for one week to one month.
Hyundai Department Store also officially opened The Hyundai Seoul in February 2021 and launched 'Creative Ground,' a collection of fashion popup stores on the second basement level, establishing itself as an "MZ playground." Unlike the traditional image of department stores, the space was designed to be trendy and appeal to the MZ generation (Millennials + Generation Z), and it gained huge popularity by hosting popups of popular brands.
For this reason, the newly launched Kinetic Ground by Lotte Department Store was considered CEO Jung's ambitious project to boost the department store's stagnant performance in recent years. Last year, the Lotte Department Store Myeongdong Main Branch, where Kinetic Ground is located, recorded sales of 2.0596 trillion won, lagging behind Shinsegae's Busan Centum City branch, which posted 2.1081 trillion won in sales during the same period. The sales growth rate at Shinsegae Centum City branch reached 4.9%, while Lotte Main Branch only achieved 2.3%. This explains why CEO Jung gave such strict feedback to the executives after thoroughly inspecting the new store.
Born in 1965, CEO Jung joined Samsung Group as an open recruit and worked at Shinsegae Group for over 20 years. During his time there, he served as head of the overseas fashion division at Shinsegae International, bringing fashion brands such as Armani, Moncler, and Maison Margiela into Korea. Since 2021, he has been with Lotte Shopping, serving as head of the department store business unit (CEO of Lotte Department Store). He is the first external recruit to serve as CEO of Lotte Shopping.
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