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Tag: Shinsegae Department Store

  • Shinsegae plans ‘Korean Amazon’

    Shinsegae plans ‘Korean Amazon’

    Shinsegae has secured investment worth 1 trillion won ($877.8 million) to build a separate company dedicated to its online business, finally giving wings to Vice Chairman Chung Yong-jin’s ambitious plan to create a “Korean version of Amazon.”

    Shinsegae said Wednesday that it succeeded in attracting funds worth 1 trillion won from two global private equity firms, BlueRun Ventures and Affinity Equity Partners, to launch a separate company that will comprehensively handle the retail giant’s online business.

    The investment plan was revealed in January, but the detailed conditions have been finalized after nine months of negotiation.

    “Shinsegae Department Store and Emart have led growth within the group until now,” said Chung. “But from now on, the new entity dedicated to online business will lead growth. All capacity within the group will be concentrated on the online business.”

    The retailer will spin off the online business from Shinsegae and Emart and merge them into a separate entity. Shinsegae is mainly in charge of its department store business while Emart is in charge of the eponymous discount chain and warehouse-style mart Traders, among others.

    Of the 1 trillion won investment, 700 billion won will be used to establish the new company, which is scheduled to launch in the first quarter of 2019. The name of the new entity hasn’t been decided. The remaining 300 billion won investment will follow at a later date.

    “Shinsegae’s new online business-dedicated entity is expected to help it grow into a core company in Korea’s e-commerce industry,” the company said in a statement.

    Shinsegae has been running an integrated online platform called SSG.com, which encompasses several online malls such as Shinsegae Mall, Shinsegae Department Store, Emart Mall and Traders, all either run by Shinsegae or its discount chain affiliate Emart.

    The soon-to-launch company will operate these online malls.

    “A complete integration of the online platform will enable comprehensive investment, simplified decision making and enhanced proficiency,” the company said.

    Shinsegae plans to concentrate investment in the online mall’s logistics service and infrastructure to begin with. It said it plans to invest 1.7 trillion won in logistics centers and related technology and achieve revenue of 10 trillion won for the online business by 2023.

    Shinsegae currently runs two logistics centers dedicated to online malls in Bojeong and Gimpo in Gyeonggi. The retailer is building a third one in Gimpo, which is scheduled to start operating by the latter half of next year.

    SSG.com launched as an integrated site in 2014 and has been recording an average 20 to 30 percent growth each year. It reached 2 trillion won in revenue last year and turned to profit making in the first half of this year

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  • Shinsegae Department Store uses AI in marketing push

    Shinsegae Department Store uses AI in marketing push

    Shinsegae Department Store has become the first South Korean retailer to deploy a marketing strategy using AI technology.

    A wave of artificial intelligence (AI) is sweeping the nation’s retail industry, as major department stores and online shopping malls rush to adopt the latest technology to attract consumers.

    From this week, Shinsegae Department Store is introducing a personalisation service called “S Mind”, which will analyse each customer’s brand preferences and come up with product suggestions.

    Using a database of some 5 million existing customers, S Mind will take into consideration around 100 factors including the purchase history, gender, age, and location.

    The results, which will include suggested brands and related shopping information, will be sent to customers through Shinsegae’s mobile application.

    AI Korea

    Shinsegae predicts its latest move will generate additional sales revenue of 100 billion won annually.

    The new system, established solely with South Korean developers and data analysts, was four years in the making before its completion.

    Shinsegae Department Store’s rival, Lotte Department Store, teamed up with IBM Korea last December to develop a new mobile app AI feature that is expected to be released by the end of this year.

    Lotte’s new ‘Recommendation Bot’ will work as a shopping advisor to make suggestions through voice messages or texts, and will give app users information on the latest trends and celebrity fashion news.

    Kim Myeong-gu, who is responsible for omni-channel marketing at Lotte, said, “With the overload of information today, many customers find it tiresome to make a choice.

    “Our new AI-based recommendation feature will differentiate our marketing strategy with that of our competitors,” he added.

    As the major retail chains are beginning to embrace AI technology that will redraw the landscape of how we shop, the industry as a whole and the government are also backing the trend.

    A new alliance was formed yesterday which will see the retail and distribution industry work closely with IT and manufacturing companies to adopt the fourth industrial revolution.

    Dubbed the “Retail Industry Convergence Alliance,” the cross-industry coalition will help spread the use of new technologies in various fields including research and development.

    The fourth industrial revolution, typified by advanced technology such as AI, IoT, robots, augmented reality and virtual reality is rapidly being incorporated into the retail and distribution industry around the world.

    An official from the Korean Ministry of Industry said: “For our retail industry to be acknowledged as a global platform, it’s important to emphasise having the right business environment for innovation and cooperation.

    “The government will help with subsidies to make sure the collective effort between various industries leads to new business opportunities and markets.”

  • Shinsegae bets big on rooftop entertainment

    Shinsegae bets big on rooftop entertainment

    Shinsegae Department Store’s newest location in Daegu is set to open next month, and it will include a massive 56,000-square-foot aquarium and indoor park on its roof, the company revealed Wednesday.

    The move is a bid to attract more visitors with family-friendly entertainment options. Incorporating more amusement facilities into its department stores and shopping malls has been Shinsegae’s main strategy in breaking through a prolonged slump in the retail business.

    shinsegae-aquarium

    The aquarium, which will feature some 200 types of animals including rare ones like manatees, sea lions and elephant seals, will occupy the ninth floor of the store. An indoor park with oversize furniture a la Alice in Wonderland and an outdoor plaza with plants and fountains will be adjacent to the aquarium.

    “The Daegu branch will be different from the concept of existing department store and focus on providing value and experience to visitors,” Shinsegae Department Store CEO Jang Jae-young said. “We will become a landmark in the North Gyeongsang region and attract people who were originally planning to go to an amusement park, zoos or baseball games during the weekend with our diverse cultural facilities.”

    This is the first time a Korean department store is installing an aquarium on the top floor. The heavy weight of water tanks requires most aquariums to be located at ground or on lower levels. Shinsegae, though, has defied convention by placing all its entertainment facilities on the roof.

    “The construction cost is double compared to when building [an aquarium] on ground level, but we boldly invested to provide more pleasure to visitors,” Shinsegae said in a statement.

    A 600-seat concert hall and art gallery that will host exhibitions and auctions are also in the space.

    The Daegu location is the last of Shinsegae’s six-projects initiative announced early this year, which also includes the recently-opened Starfield Hanam in Gyeonggi, the largest retail complex in Korea.

    CEO Jang said the series of projects marks Shinsegae’s “quantum jump” that it has been preparing for over three years, and once complete, its retail businesses will be “free of market share competition.”

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  • Store’s e-receipts pay off with cash-saving extras

    Store’s e-receipts pay off with cash-saving extras

    Shinsegae Department Store is set to launch a new smartphone app that offers online and offline shoppers e-receipts with extras.

    While the electronic receipt app avoids the hassle of scraps of paper receipts, it can also provide discount coupons and make it easier for customers to park cars.

    Scheduled to launch on Friday, the retailer said the app will help it engage with customers and potentially learn consumer shopping habits from the digital records, and make exchanges or returns easier.

    Retailers outside of Korea have already adopted e-receipts, but local shops have been slow to utilize the system.

    Global marketing company Epsilon International said the e-receipt is “an innovative communications vehicle for retailers that offer limitless marketing possibilities, providing deeper insight into consumer shopping habits, which can lead to more targeted advertising mailers, promotions and emails.”

    On top of offering e-receipts, the platform will provide information about different sales events and discount coupons, the department store chain said.

    The Shinsegae app will also help the store’s parking service. If a customer registers a car number, they can check the length of time they have spent in the parking lot.

    In the Gangnam and Incheon branch, customers can confirm their parking locations on the app and also get their parking ticket validated for free parking.

    The company said that users are allowed to log in with cell phone numbers instead of having to create IDs and passwords.

    Starting in September, users of the app can also receive a list of bestselling products. In addition to the new features – an upgrade to the old app which gave basic store information – Shinsegae said it will add other services to the platform.

    The retailer also unveiled a pickup service that allows online users to pick up their orders at Shinsegae Department Store.

    The new service is part of “omni-channel retailing” which is used by retail giant Amazon, which is a marketing strategy aimed at bridging the gap between online and offline stores.

    “The boundary between online and offline shopping is getting blurry,” said Hong Jeong-pyo, director at the marketing strategy division at Shinsegae. “Shinsegae launched the services that combine the advantages of online and offline shopping.”

    The release is the latest digital service offered by Shinsegae. The group introduced a new mobile payment system called SSG Pay, where consumers can pay with the app at Shinsegae affiliates, including Shinsegae Department Store and E-Mart, WithMe convenience stores, Starbucks, Premium Outlet and SSG.com.

     

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