The Korean retail industry – traditionally centred on price and product competition – is now grappling with intense rivalry by adopting innovative approaches to store differentiation.
In particular, there is a rising trend among consumers towards specialised stores that concentrate on a specific product category, acting as a catalyst for increased sales.
A noteworthy example is Homeplus, which recently opened its first Ramen Museum in Dobong-gu, Seoul, positioning itself as a “Mega Food Market” with a strong emphasis on food. The company is currently in the process of renovating its stores to align with this new strategy.
Distinguished as the largest ramen specialty store in Korea, Homeplus offers an extensive selection of 360 ramen varieties, including 70 imported options. Operating in Homeplus 11 Mega Food Markets, the new Ramen Museums have been attracting a diverse clientele ranging from regular customers to devoted ramen enthusiasts.
Sales have witnessed a significant uptick, attributed to the convenience of consolidating all ramen varieties available in Korea within one location, coupled with the competitive pricing offered by large discount stores. On average, each store has experienced a 34 per cent surge in sales since the inauguration of the Ramen Museums, with some outlets reporting an impressive 88 per cent increase in ramen sales.
Homeplus has expanded its specialised store portfolio this year, introducing concepts such as the Whiskey Library, which specialises in alcoholic beverages; the Mixology Zone, reflecting drink mixing trends; and Better Choice, focusing on health-conscious food items like natural snacks.
The Whiskey Library, boasting more than 380 whiskies, has seen a notable 65 per cent increase in sales compared to last year. Similarly, the Mixology Zone and Better Choice have recorded growth rates of 145 per cent and 50 per cent, respectively.
This strategic move towards specialisation is not unique to Homeplus. Other hypermarkets such as Lotte Mart and E-Mart have leveraged their extensive facility infrastructure to establish specialised stores like the ‘Zero Meat Zone’ and ‘Gourmet Street Zone.’
Recent entrants into the specialised store competition include convenience stores, exemplified by CU opening the first ramen specialty store in the convenience store industry near Hongik University in Mapo-gu, Seoul. The store’s unique layout features an entire wall dedicated to ramen.
Since its opening, the store has achieved impressive daily sales, averaging 500 ramen noodle packs per day – more than 10 times higher than other convenience stores. Notably, 70 per cent of the store’s sales consist of bagged ramen, a departure from the usual preference for cup ramen in convenience stores. Customers favour sachet ramen as it allows them to prepare it themselves using the ramen cooker provided in the store.
Additionally, 80 per cent of customers who purchase ramen also make additional purchases, contributing to an overall boost in store sales.
The growing popularity of K-Ramen overseas has further amplified its appeal among foreign tourists, with 70 per cent of evening customers being international visitors.
A CU official remarked: “Having witnessed the sales effectiveness of specialty stores focusing on a single item, we plan to expand this concept to a variety of other items.” This sentiment underscores the industry’s recognition of the success achieved by specialised stores and the intention to replicate this strategy across different product categories.
This story was originally published by Korea Bizwire.
