Online shopping is rapidly growing, yet large supermarkets are focusing on their physical stores. They are enhancing features that are difficult to replicate online, such as fresh food and dining experiences, to encourage customers to visit in person. Emart is creating multi-purpose spaces, while Lotte Mart is strengthening its grocery offerings with tailored content for local markets.
According to the retail industry on September 6, Emart recently renovated its Wolgye store into the 'Starfield Market Wolgye.' This is the fifth Starfield Market nationwide and the first in Seoul. It combines Emart, Traders, food and beverage (F&B) options, and cultural and relaxation spaces all in one location. The first and second floors feature a 180-pyeong (approximately 6,000 square feet) relaxation and cultural area, including a children's reading and play space. About 80% of the F&B brands have been revamped, and the Olive Young store has been expanded threefold. The strategy aims to transform supermarkets from places for quick shopping to family-friendly spaces for shopping, dining, and leisure. In the first half of this year, sales at the existing four Starfield Market locations increased by 28% compared to the same period last year, significantly outpacing Emart's overall sales growth rate of 2.7%. Emart is expected to introduce Starfield Markets in Gyeonggi Province and Gunsan, North Jeolla Province, by the end of this year.
Lotte Mart is focusing on food offerings. Its food-specialized format, 'Grand Grocery,' enhances fresh food, deli items, ready-to-eat meals, premium ingredients, and private label (PB) products, with about 90% of the store dedicated to groceries. This format is currently being implemented in locations such as Eunpyeong and Guri. They are also expanding experiential content. The Songpa store will introduce a permanent art exhibition space, 'M Art Center,' covering about 700 pyeong (approximately 23,000 square feet) in August 2024. In its first month, overall sales and customer numbers increased by approximately 10% and 5%, respectively, compared to the same period last year, with cumulative visitors exceeding 45,000. The Suwon store, which operates a 600-pyeong (approximately 20,000 square feet) kids' café and family restaurant, saw tenant sales increase by 12% last year. The Samsan store also reported a 1.5% increase in tenant sales over the same period last year after introducing the 'Crayon Shin-chan Game Center' in June.
The push for investment in physical stores by large supermarkets is driven by the rapid growth of online shopping. According to the Ministry of Trade, Industry and Energy's 'July Major Retailer Sales Trends,' online sales accounted for a record 60.8% of total retail sales. In contrast, the share of supermarket sales was only 8.1%. While total sales for major retailers increased by 7.3% in the first half of this year compared to the same period last year, supermarket sales fell by 7.3%. Supermarket sales have declined for nine consecutive quarters from the second quarter of 2024 to the second quarter of this year.
However, individual company performances differ from the overall trend. Emart's total sales for the first half of this year reached 9.1581 trillion won, a 2.7% increase, while operating profit rose by 15.4% to 171.9 billion won. Lotte Mart's domestic total sales increased by 2.4% to 2.2978 trillion won, and its operating loss decreased from 41.2 billion won to 33.4 billion won. Analysts suggest that store renovations and enhanced product competitiveness are helping to stabilize performance.
A retail industry insider stated, "The competition among large supermarkets has shifted from increasing the number of stores to enhancing customer visit frequency, dwell time, and purchase amounts at existing locations. The key moving forward will be whether renovation investments translate into improved sales and profitability."
According to the retail industry on September 6, Emart recently renovated its Wolgye store into the 'Starfield Market Wolgye.' This is the fifth Starfield Market nationwide and the first in Seoul. It combines Emart, Traders, food and beverage (F&B) options, and cultural and relaxation spaces all in one location. The first and second floors feature a 180-pyeong (approximately 6,000 square feet) relaxation and cultural area, including a children's reading and play space. About 80% of the F&B brands have been revamped, and the Olive Young store has been expanded threefold. The strategy aims to transform supermarkets from places for quick shopping to family-friendly spaces for shopping, dining, and leisure. In the first half of this year, sales at the existing four Starfield Market locations increased by 28% compared to the same period last year, significantly outpacing Emart's overall sales growth rate of 2.7%. Emart is expected to introduce Starfield Markets in Gyeonggi Province and Gunsan, North Jeolla Province, by the end of this year.
Lotte Mart is focusing on food offerings. Its food-specialized format, 'Grand Grocery,' enhances fresh food, deli items, ready-to-eat meals, premium ingredients, and private label (PB) products, with about 90% of the store dedicated to groceries. This format is currently being implemented in locations such as Eunpyeong and Guri. They are also expanding experiential content. The Songpa store will introduce a permanent art exhibition space, 'M Art Center,' covering about 700 pyeong (approximately 23,000 square feet) in August 2024. In its first month, overall sales and customer numbers increased by approximately 10% and 5%, respectively, compared to the same period last year, with cumulative visitors exceeding 45,000. The Suwon store, which operates a 600-pyeong (approximately 20,000 square feet) kids' café and family restaurant, saw tenant sales increase by 12% last year. The Samsan store also reported a 1.5% increase in tenant sales over the same period last year after introducing the 'Crayon Shin-chan Game Center' in June.
The push for investment in physical stores by large supermarkets is driven by the rapid growth of online shopping. According to the Ministry of Trade, Industry and Energy's 'July Major Retailer Sales Trends,' online sales accounted for a record 60.8% of total retail sales. In contrast, the share of supermarket sales was only 8.1%. While total sales for major retailers increased by 7.3% in the first half of this year compared to the same period last year, supermarket sales fell by 7.3%. Supermarket sales have declined for nine consecutive quarters from the second quarter of 2024 to the second quarter of this year.
However, individual company performances differ from the overall trend. Emart's total sales for the first half of this year reached 9.1581 trillion won, a 2.7% increase, while operating profit rose by 15.4% to 171.9 billion won. Lotte Mart's domestic total sales increased by 2.4% to 2.2978 trillion won, and its operating loss decreased from 41.2 billion won to 33.4 billion won. Analysts suggest that store renovations and enhanced product competitiveness are helping to stabilize performance.
A retail industry insider stated, "The competition among large supermarkets has shifted from increasing the number of stores to enhancing customer visit frequency, dwell time, and purchase amounts at existing locations. The key moving forward will be whether renovation investments translate into improved sales and profitability."
* This article has been translated by AI.
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