Department stores reshuffle cosmetic counters to woo VIPs

One of the key marketing strategies for department stores is to catch customers’ eyes as soon as they enter the edifice.

This is precisely the reason why most of the flashy cosmetics are located on the ground floor of most department stores.

But to move in tandem with growing market demands that call for diversifying the customer base, the stores are now attempting different sales strategies.

Some of these strategies involve cheaper prices and better availability, while others mean becoming more exclusive, all depending on the kind of clientele the stores want to cater to.

Shinsegae Department Store Gangnam, for instance, chose to offer a spacious shopping zone to its premium customers by opening a “select” beauty shop on the second floor of its annex building in 2012.

The move was not just about the upscale brands, but also about displaying unique imported brands that might appeal to VIP customers who have been abroad and are accustomed to lesser-known foreign luxury brands.

Such brands include overseas skin care brands such as Chantecaille, La Mer and Cle de Peau, as well as a number of expensive niche perfumes such as Jo Malone, Creed and Frederic Malle.

“Because the location is rather secluded and private when compared to the main cosmetic counters on the ground floor, the zone allows the visitors to experience a deeper and fuller enjoyment of the brands and products,” said Chung Hee-won, a PR official of Shinsegae.

Also, as the zone is directly linked to the luxurious fashion or jewelry brands such as Chanel, Hermes and Tiffany as well as to the neighboring JW Marriott Hotel, the so-called “prestige-level” clients are pampered so that they can shop while moving around as little as possible, he added.

Going further up the ladder

In another attempt to attract the high-end clientele, cosmetic brands such as Yves Saint-Laurent Beauty decided to open even more so-called select shops in addition to their already existing stores.

“Yves Saint-Laurent has long been classified as a luxury brand but its customer base has expanded to include the younger generation over recent years,” the Shinsegae official said.

More customers flocked to Yves Saint-Laurent, but it wasn’t all good, Chung explained.

“The conventional VIP customers were being driven away because they felt the brand was becoming too common,” he said, which was why the brand decided to enhance its high-end businesses.

“This way, the brand can attract new customers while also sustaining its long-time VIPs.”

Galleria Department Store took a step further and opened up another location for its premium cosmetic brands.

The department store, located in the affluent southern Seoul area, already had a number of high-priced beauty brands but opened some upscale shops in its main building over the past few years.

Among them is a so-called Perfume Bar, a prestige private select perfume shop featuring special editions of Chanel, Armani, Dyptique and others.

Also, it is here where one may find a store for Noesa or Swiss Perfection, both top-priced skin care brands where several of the products are priced over 1 million won ($940).

Moving down to the masses

Market champion Lotte Department Store, on the other hand, chose to take the opposite direction by taking low-priced casual cosmetic brands and moving them down to the basement floor in an attempt to draw more consumers from the lower end.

“As our building is directly connected to Euljiro 1-ga Station and closely neighbors downtown landmarks, it has a high pedestrian population,” said Park Sang-woo, a PR official of the Lotte flagship store in Sogong-dong.

“While looking to expand the space of cosmetic counters, it seemed to be the best way to move trendy makeup-focused brands to the underground floor where young consumers in their 20s and 30s could frequent them.”

Cosmetic shops, which usually require a relatively small space and have a high turnover rate, are financially attractive to department stores, especially when other fashion and lifestyle sections are not performing so well, the official also said.

“Shopping is no longer just about a specific brand or product, but has to be seen at a comprehensive angle in connection to a person’s general lifestyle,” the official said.

The local department stores’ move to diversity their cosmetic counters is largely in line with this changing trend, according to the official.

By Bae Hyun-jung
(tellme@heraldcorp.com)