Inquivix Insights No.4 – February Issue 2022

We are here with another installation of Inquix Insights from Korea. We’ll take a look at how Korean retailers changed their strategies to increase Valentine’s day sales and meet the direct-to-consumer demand in other products. We also have some updates on how Korean companies are taking advantage of online platforms to up their marketing game. In addition to these, the effects of the global trends on local marketing are discussed as well.

1. Distribution Industry Tackles Valentine’s Day with “Collaboration/Limited Edition” Strategy

The convenience store industry is doing everything it can to avoid missing out on this year’s Valentine’s Day sales. COVID-19 had a significant impact last time around, but Industry experts predicted that offline demand would decrease because people weren’t buying gifts face-to-face anymore, instead opting for online gifting where they could buy something quickly with no physical constraints. Nonetheless, the convenience store industry has introduced a variety of items in order to avoid missing out on the possibility. The keywords were shortened to “collaboration” and “limited edition” in line with last year’s trend. 

The new form of gift items is no longer solely chocolate sweets, the options are diversifying gradually with jewelry, bouquets, and other items. Major corporations not just launched a variety of chocolate products but also created alcoholic beverages and collaboration goods that complement chocolate products. The retail industry, like last year, planned to improve existing chocolate products, specialized collaboration items, and wine choices for family commercial areas.

2. D2C Transition Is Growing Rapidly from Startups to Large Companies

The interest in the D2C (Direct to Consumer) business model that may directly interact with consumers through its own platform is on the rise. With the expansion of non-face-to-face transactions as a result of COVID-19, the D2C approach, which was originally developed for eCommerce businesses, is gaining significance in other areas such as accommodation, funding, and food.

It bypasses the typical middle phases of distribution, lowering expenses and offering items or services directly to consumers, while also fostering a natural growth of consumers. Marketing, promotion, and sales strategies based on direct consumer purchase data analysis are used to improve services at a reasonable price while also allowing for more detailed client management. As more businesses strengthen their distinctiveness by shifting to D2C through innovation in the distribution architecture, various IT services that aid this are emerging.

3. CU – CJ CheilJedang Launch Unique Marketing Collaboration with ZEPETO Platform

CU announced that it will work with CJ CheilJedang to conduct collaboration marketing on the worldwide metaverse platform ZEPETO. For the second time since collaboration with Binggrae, CJ CheilJedang’s popular products have been made available so that they can be found at virtual reality convenience stores. With the new collaboration with ZEPETO users will be able to virtually purchase four popular products: Hetbahn (instant rice), Hetbahn Cupban (instant rice cup), Bibigo Wang Gyoja, and the Healthy Chicken Breast Steak. Using a function that allows avatars to pick up the product, they might also carry the merchandise with them.

4. “Paying 100,000 Won for Video Review”; The Battle to Secure Review Content

Recently the battle to secure high-quality and trustworthy customer reviews in the e-commerce sector has been on the rise. The user reviews have evolved into a potent weapon for retaining consumers as they become “new content.”

SBSG.com, for example, has held a “review contest” with up to 100 000 won in prize money for a “well-made video review.” In a month, 3000 reviews have been submitted for this. There was a range of video reviews from cooking to appliance installation. ‘Unboxing’ videos were some of the most popular ones as they revealed new products.

5. A Promising K-Deal in the New Year for Nas Media with the Operating Profit Growth of 22% In 2021 

The KT Group’s media representative Nas Media announced that it recorded an annual sales increase of 11% which is a total of 124.2 billion won and an operating profit of 32.9 billion won, an increase of 22%, in 2021. According to Nas Media, this year’s growth in internet advertising is expected to result in greater earnings. This is due to the K-deal, DMP (Data Management Platform) construction, and the introduction of Addressable TV offerings through KT big data corporation.

6. New Instagram Feature: Manage Your Posts All at Once

Instagram has announced its new feature for managing your content easily. With the new “My Activity” feature, it will be easier than ever to manage your Instagram account. You can remove large quantities of comments, likes, and posts in one click without having to go back through them all individually. The user profile’s “My Activity” section offers users shortcut tools for seeing and managing their past timeline, IG Stories, postings, Reels, IGTV likes and comments on other people’s feeds, and so on. 

 Especially for businesses with Instagram accounts, this feature helps to manage their content better. From rebranding efforts to getting rid of old campaign content, now Social Media managers have an easy solution to removing or archiving content in clusters.

7. Anti-Chinese Sentiment Makes ‘Olympic Marketing’ Disappear

Anti-Chinese sentiment has increased as a result of the Olympic boycott in 12 countries including the US and the UK making it difficult for global sponsors to carry out their marketing campaigns. In actuality, the Olympic Games’ official sponsors have spent a staggering amount of money on this event, but they are unable to advertise on television. Their ‘Olympic Marketing’ campaigns had to be put on hold amidst the negative responses. 

This is because of the expressed negative atmosphere in the tournament earlier, the sponsors have no choice but to consider their positions. It is in a position to take into account business strategy disruptions outside of China. This is due to the fact that sponsors are compelled to evaluate the views of Western nations including the United States, which make up a considerable portion of their market. As a global business, their strategies must account for the entire world, rather than just one location.

Conclusion

We took a look at how retailers faced the changes in consumer behavior with new strategies. Collaboration/Limited Edition strategies, video reviews, virtual reality, and D2C transition have helped South Korean businesses to thrive even among the adverse effects of COVID-19. The new features introduced by Instagram will also have an impact on the marketing strategies of businesses. The issue of the “Olympic Marketing” failure indicated that in today’s world consumer sentiment has a big impact on businesses. We hope that these updates help your business as it expands in South Korea. Follow us for news and updates from South Korea. See you soon with another post of Inquivix Insights!