Korean retail giants ride on recommerce boom with own resale shops

[Source : KREAM Instagram]

South Korea’s retail majors are riding on the resale or “recommerce” boom, making room at their brick-and-mortar and online outlets to draw young customers in their 20s and 30s.

According to the retail industry on Monday, Lotte Department Store will open an offline shop of KREAM, a No.1 sneaker resale platform under Naver. More than 80 percent of the subscribers are in their 20s and 30s. The offline shop will operate a showroom to display limited editions, such as sneakers, apparel, and accessories.

Bungaejangter, a second-hand goods platform, opened three offline resale shops for sneakers and luxury goods in The Hyundai Seoul and Starfield COEX Mall.

Bungaejangter in The Hyundai Seoul

Seeing growth potential in the resale market, Signite Partners, a corporate venture capital arm of Shinsegae International Company, invested in Bungaejangter early this year and opened a space for the platform at its online shop for luxury resales on SSG.com. Lotte Shopping invested 30 billion won ($22.40 million) in another major second-hand goods seller Joonggonara to take 93.9 percent in its stake.

According to the Korea Internet and Security Agency (KISA), the domestic recommerce market expanded from 4 trillion won in 2008 to 24 trillion won last year. Especially, the customer-to-customer (C2C) transactions for luxury goods and limited editions were estimated to reach 500 billion won last year.

Retailers compete to open resale shops because they can attract young customers after recommerce has become a new shopping trend, said industry observers.