erlooked, primarily because of the strong luxury presence of its neighbouring countries, China and Japan. However, unlike these more established markets, South Korean customers exhibit unique preferences in both fashion taste and spending behaviour. This distinctiveness in consumer behaviour provides a fertile ground for luxury brands to not only introduce their products but also tailor their offerings to meet the specific demands of South Korean shoppers. Strong spending power According to Morgan Stanley, South Koreans were the world’s biggest spenders on personal luxury goods, with US$325 per capita, far outpacing the US$55 and $289 per capita spent by consumers in China and the United States, respectively. “An interesting phenomenon in Korea is the ease of purchasing in instalments,” Dominika Kustosz-Lee, founder and CEO of Dkl & Company, told Inside Retail. “This is a key element for aspirational luxury customers and their purchasing power.” Kustosz-Lee explained that whenever a customer pays more than KRW 50,000 (US$37) with their credit card, they can access both offline and online instalments. Most financial service providers offer no interest for periods between two and five months. It’s a standard question asked by the cashier, so customers don’t even need to inquire about it. “This makes it much easier to purchase your dream item and contributes to the widespread luxury consumption in Korea. Those with higher income levels can afford a much wider array of luxury items,” she added. The Korea Economic Daily reported a surge in demand for luxury goods among affluent consumers in their 40s and 50s. Credit card company BC Card said these customers accounted for some 68.7 per cent of the expenditures in luxury goods stores in Cheongdam-dong last year. Different preferences and priorities There has been a significant shift toward quiet luxury, characterised by a preference for understated elegance and high-quality materials over flashy logos and ostentatious designs. “It makes sense because Koreans dress quite conservatively, and they are well aware of even the niche brands,” noted Kustosz-Lee. She elaborated that this trend aligns well with the Korean fashion ethos, where subtlety and sophistication are highly valued. Adding to this, she mentioned that she often hears people gushing over Polène bags, appreciating their refined aesthetics and commenting on ‘how European’ they look. Furthermore, Kustosz-Lee observed that Scandinavian or ‘Scandi’ styles, known for their minimalist and functional design, are currently very popular in Korea, influencing everything from fashion to interior design. “A couple of months ago I went to the Shinsegae Department Store, one of the absolute top locations in Seoul, and the quite small The Row store was one of the busiest in the whole building.” While the market has seen a notable shift towards the quiet luxury trend, major luxury brands still retain their popularity, posting sales growth in this market. According to Luxury Business Group, Chanel was the top-performing luxury brand in South Korea, surpassing Louis Vuitton with sales reaching US$1.2 billion. Dior also made the top three highest-selling luxury brands in South Korea. Meanwhile, Hermès and Loro Piana are among the brands considered the most luxurious by Korean consumers. A study by Consumer Trend Insights found the most impactful elements on luxury purchase decisions are design (39 per cent), brand history and tradition (25 per cent), exposure to media (17 per cent), and quality and technology (16 per cent). “I think these are very important insights, especially the relevance of ‘design’ for actual purchases as Korean society remains very mainstream and Koreans are very conscious of other people’s perceptions of them,” she said. Additionally, what characterises the Korean consumer in general is the intensity of shopping fads. “If something is a hot topic, the whole country is on it, and it becomes this nationwide craze that sometimes also fades away quite fast,” she added. “One of the first things I noticed when I came to Korea was the general preference for dainty accessories, soft or basic colours, which only intensified with time as the country became wealthier.” “Another observation is that mainstream culture is much more important than, for example, in Japan, and so consumers tend to gravitate towards things that are appreciated by others as well.” Social media and culture Like other markets, culture should always be considered as part of a business strategy to connect with local customers. Korea celebrates Chuseok, often referred to as the Korean Thanksgiving, where thanks are given to ancestors for a bountiful harvest, and Seollal, the Lunar New Year. “Chuseok holds a significance similar to Christmas and is also a time for gifting, from companies presenting gift sets to their employees to families and friends exchanging gifts. This season is marked by grand gestures and significant sales, driving substantial shopping activity,” said Kustosz-Lee. “Regarding Christmas, in Korea, much like in Japan, it is primarily a holiday for couples. Gifting during this time is important, especially the splurging kind.” While social media exposure and collaborations with celebrities are vitally important for brand visibility and engagement, partnering with Korean artists has proven to be exceptionally effective in penetrating the local market and creating a deeper cultural resonance. “Art collaborations also resonate well in this market. The Korean art market is booming, and young Koreans are heavily invested in it. Couples often go on dates to museums and galleries, and young people frequently visit art fairs. The Frieze and Kiaf Art Seoul is a significant event for luxury brand experiences,” said Kustosz-Lee, highlighting the cultural significance of art in Korean society. “With Seoul Art Week fast approaching, luxury brands have a prime opportunity to not only showcase their products but to also strengthen and deepen their connections with the local market,” she emphasised, pointing out the importance of timing and cultural events in marketing strategies. She also added high service standards are the norm, so client advisors must be thoroughly trained to meet the expectations of discerning customers. An impressive flagship store and pop-up activations are essential for capturing customer interest and loyalty, with Dosan Park and Seongsu being the most popular areas for such premium retail experiences. “And let’s not forget – omnichannel integration is critical. Koreans are a digital-first nation, and it’s crucial to integrate Kakao Talk channels and other popular digital platforms into the customer journey to ensure a seamless and engaging experience,” she concluded, stressing the importance of digital engagement in a highly connected society.