Luxury goods sales at department stores rise despite economic downturn

Korea's three major department store chains said Tuesday their luxury goods sales continued to rise last year on steady demand for premium products despite an economic slowdown.

Luxury goods sales at Lotte, Shinsegae and Hyundai department stores sharply increased during the 2020-2022 period when people were engaged in what economists call "revenge spending," in which they made up for missed travel and shopping during the COVID-19 pandemic.

The pace of sales growth in luxury goods slowed in 2023 as consumers spent more on travel and other leisure experiences. But in the following year, the three companies came up with robust sales results.

Luxury sales at Lotte Department Store, the country's biggest department store by sales, rose 5 percent in 2024 from a year earlier.

Shinsegae's and Hyundai's luxury sales climbed 6.2 percent and 11.7 percent, respectively, over the same period.

The companies did not provide the value of their luxury goods sales.

"Demand for luxury goods remained strong and steady last year, though the sales growth of luxury items was not as explosive as in the pandemic period," an official at Hyundai Department Store told Yonhap.

This year, department store officials expect luxury sales will likely be less affected by high interest rates and rising consumer prices, though they may weigh on consumer sentiment and the companies' overall sales. (Yonhap)