Korea’s leading duty-free operators – Lotte Duty Free, Shilla Duty Free, Shinsegae Duty Free, and Hyundai Duty Free – are competing fiercely for Chinese tourists visiting Korea during the Lunar New Year holiday by launching extensive marketing campaigns.
Market analysis firm China Trading Desk reported last week that an estimated 230,000 to 250,000 Chinese tourists were expected to travel to Korea between February 15 and 23, marking a significant 52 percent increase compared to the same holiday period last year. Industry experts predict that Chinese visitors will spend around $330 million during their stay.
Duty-free stores are focusing on providing attractive incentives and enhanced convenience for Chinese shoppers to capture this lucrative market.
Lotte Duty Free reported that a group of 2,300 Chinese tourists visited their Myeongdong store earlier this month after arriving at Incheon Port. This group consisted of local merchant associations with substantial purchasing power. Additionally, another group of 4,000 Chinese tourists arriving on a cruise ship was scheduled to visit Lotte Duty Free stores in Busan and Jeju during the holiday season.
Lotte Duty Free is offering a prepaid shopping incentive, PRE LDF PAY, of up to 90,000 won ($62.12). Shoppers can also receive an additional shopping incentive of up to 1.23 million won by using LDF PAY, Lotte’s proprietary payment system. Furthermore, Lotte provides a maximum discount of 300,000 won for payments made through Alipay, a widely used payment application among Chinese consumers.
Shilla Duty Free is providing prepaid cards valued up to 1.23 million won, based on the purchase amount, at its Seoul and Jeju locations. They are also offering an immediate discount coupon of 40 yuan for customers spending over 1,200 yuan through WeChat, a popular Chinese payment application, at their physical stores. Alipay users can receive a 45 yuan discount coupon for purchases of 1,500 yuan or more. Shilla Duty Free’s online store is offering a 30 yuan coupon for purchases of at least 1,000 yuan.
Shilla Duty Free’s Jeju store has been distributing various vouchers redeemable at partner cafes and restaurants on the island, depending on the purchase amount.
Shinsegae Duty Free has partnered with Alipay+ to offer discount coupons through a lucky draw event for Chinese customers shopping at its offline stores until Feb. 25. For customers using a UnionPay card, issued by China’s state-owned financial services corporation China UnionPay, at the Myeong-dong store, Shinsegae provides a tax-free incentive of up to 300,000 won.
Shinsegae Duty Free has introduced premium whisky and an exclusive selection of wines and champagnes at its stores in Incheon Airport. It has also partnered with airlines and hotels, including Cathay Pacific and Marriott Bonvoy, allowing customers to earn membership points.
Hyundai Duty Free has launched Hyun’s Day promotions, offering discounts of up to 80 percent on luxury brands at its Trade Center branch in Coex, Gangnam, and discounts of up to 50 percent on sunglasses, shoes, and jewelry at its Incheon Airport store.
“The influx of Chinese tourists during the Lunar New Year holiday presents a vital opportunity for duty-free operators, as we anticipate a significant increase in visitor numbers during this period,” stated a duty-free shop official.
“The revenue generated by each duty-free store during this time will be a crucial factor, impacting not only first-quarter earnings but also overall yearly performance.”
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