SPA brands are recognized by South Korean consumers as clothing brands that sell reasonable-quality apparel for affordable prices. Consumers in their 20s favor buying clothes from SPA brands because fashion trends change quickly, and many find it better to buy affordable clothes for each season rather than to spend big money on luxury brand clothing and fall behind fashion trends.
South Korea's SPA market which stood at 20.6 trillion won ($15.6 billion) in 2022 is estimated to reach 22.7 billion won by 2077, according to global market analyst firm Statista. As of 2022, the SPA market is led by Japanese brand UNIQLO with annual sales of 803.6 billion won, followed by TOPTEN operated by South Korean retailer Shinsung Group with 780 billion won, and SPAO, operated by fashion conglomerate Eland, was ranked third with annual sales of 400 billion won.
SPA targeted consumers in their 40s and 50s while lowering prices to make amends for weakened spending power. In October 2023, Eland, SPAO's operator, saw sales increase by more than 15 percent compared to the same period a year ago. The SPA brand operator lowered the price of inner winterwear by 3,000 won and saw sales increase by 672 percent on-year. Sales of lightly padded jackets also increased by 540 percent on-year.
To solve problems caused by slow-moving inventory, Eland adopted a special sales marketing method that test-produces some 200 pieces of clothing within a 48-hour period and put them on the shelves of SPAO's main stores. The apparel maker was able to accurately estimate customer demands based on the sales record of test-produced products and manufacture them within 120 hours if demands were high.
The 2022 sales of TOPTEN increased by 81 percent compared to 430 billion won in 2020. The SPA brand operator said that its aggressive expansion of offline stores helped attract more customers. Also, differentiating the styles of clothing has also helped satisfy picky young customers. 8Seconds, a fashion brand operated by Samsung C&T Corporation, increased the ratio of men's apparel that cost less than 50,000 won to up to 60 percent. Samsung's SPA wing also took a different approach from other SPA rivals and launched premium lineups for young and female consumers.
reporter
Park Sae-jin
swatchsjp@ajunews.com
