Korean home shopping firms seek growth beyond TV with offline expansion

South Korean home shopping companies are accelerating their expansion into offline retail as they face growth limitations from declining television viewership and increasing broadcast transmission fees. The industry is exploring various strategies, including strengthening collaborations with affiliated distribution channels, acquiring offline retail networks, and increasing their own physical stores.

GS Retail is intensifying product collaborations between its home shopping channel, GS Shop, and its supermarket chain, GS The Fresh. GS Shop will display its self-developed 'Airclip Fresh' airtight containers in GS The Fresh stores until the end of the month to diversify sales channels. Customers can examine the products in-store and purchase them via the mobile app 'Our Neighborhood GS.' Some stores will also host pop-up events for on-site sales. This initiative follows the launch of a joint marketing campaign in January based on integrated memberships between GS Shop and GS The Fresh, now extending collaboration to product sales to enhance synergy across affiliated channels.

Other home shopping companies are directly entering the offline distribution business. Last month, NS Home Shopping acquired Homeplus's supermarket division, Homeplus Express. NS Home Shopping anticipates online-offline synergy from this acquisition, offering expanded offline sales channels for its small and medium-sized food suppliers and providing NS Home Shopping's broadcast and mobile sales platforms to Homeplus Express vendors.

Given that NS Home Shopping dedicates over 60% of its broadcast time to agricultural, livestock, and fishery products, significant synergy is expected with supermarkets like Homeplus Express, which have a high proportion of fresh food sales. The company sees potential in leveraging the nationwide Homeplus Express store network for quick commerce, aiming to establish a delivery system that provides fresh food within an hour in conjunction with home shopping broadcasts, thereby securing a differentiated competitive edge.

Hyundai Home Shopping has also expanded its presence by opening its own offline beauty select shops, 'Coasis,' with plans to increase the number of stores to four by the end of this month. Lotte Shopping is concurrently pursuing distribution businesses beyond home shopping after securing the exclusive domestic distribution rights for the French outdoor brand 'Aigle.' Industry experts view this expansion of offline touchpoints as a viable strategy for home shopping companies to overcome slowing growth.

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The current situation involves finding ways to increase customer inflow to home shopping channels as TV viewership decreases. Expanding offline is a useful strategy for the home shopping industry, which has entered a period of growth stagnation, to broaden customer touchpoints.