A growing number of Korean consumers have cut back on spending amid high-flying prices recently and the belt-tightening trend is expected to continue for the time being, a recent survey found Tuesday.
The Korea Chamber of Commerce and Industry, which surveyed 500 households nationwide, used the acronym “SALT,” which stands for “sale, a little, low price and transfer,” to explain the new characteristics of consumer behavior.
In the survey, 94 percent of households said they plan to watch prices more while shopping compared to last year, while 89.6 percent said they now prefer promotional events for cheaper bargains.
Most of the respondents also said they purchase a smaller amount of products than before and have become more ardent Web surfers to compare product prices online.
More than half said they purchase cheaper “private brands” put out by major retailers, and they sometimes give up their favorite brands and transfer to cheaper items.
Almost half of the respondents, or 49 percent, said they plan to further reduce their future spending, regardless of a potential increase in income.
“Due to price hikes, people’s buying power has been reduced, prompting their ‘SALT’ spending,” said an official from the business lobby.
“Over the past one year, 70.6 percent of surveyed households said that the growth rate of product prices was higher than that of their household income.”
The KCCI also found that a growing number of stingy consumers are turning to online shopping channels for cheaper deals.
According to the survey, online channels such as Internet shopping malls and social commerce sites, together with discount stores, were the only places where consumers have increased their spending from a year earlier.
“Considering factors like the volatile crude oil prices, the current consumer trend is expected to become more apparent in the coming months,” another KCCI official said.
By Lee Ji-yoon (
jylee@heraldcorp.com)
