January – December 2018 • Womenswear, Menswear & Unisex

Top Korean Fashion Marketplaces

K-fashion continues to be ahead of the curve in Asian fashion. In this report, we analyse the performance of 2 Korean multi-brand retailers ÅLAND and Somethin' Sweet.

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Introduction

South Korean fashion brands have long defined their own styles and silhouettes differently from mainstream fashion. Where body fitting and exposed skin are common in the West, Korean brands/retailers make statements with oversized silhouettes, high-necklines, wide-legged pants, and most famously – camisole over tops.

The strong support for local trends from Asia, particularly China, combined with the internet hyper-connectivity[1] and a robust wholesale hub based in Dongdaemun[2] have provided the optimum breeding ground for private label brands and the retailers that promote these brands. Here, we analysed two of such multi-label retailers.

 

Top Korean Marketplaces

ÅLAND expanded its global footprint by opening the first store in the western hemisphere (Brooklyn, New York) last summer of 2018. Its affordable street styles came in a spread of free-size and gender neutral clothing. Known as Korea’s best-kept secret, ÅLAND was an exclusive hotspot for local fashion icons such as Irene Kim and Soo Joo Park, before it emerged on the public radar.

Somethin’ Sweet embodies feminine-centric Korean styles with K-pop inspired homegrown brands, donned by some of the biggest girl groups such as Twice, Blackpink and Red Velvet. The retailer is also one of the few Korean e-tailers that offer free worldwide shipping with minimum orders.

 

 

Notes:
[1] Nearly 100% of households in South Korea have internet access.
[2] K-fashion imitators flocking to Dongdaemun.

Category Analysis: Apparel

ÅLAND had more non-apparel products than most fashion brands would have on average, stocking more bags and shoes.

 

Top 5 Categories

Comparing the two retailers, Tops and Outerwear were the common key performing categories, with Tops selling out 3x more than the second biggest category across the respective retailers. The outliers in comparison were Activewear, which was evidently a must-have in the street style inspired brand ÅLAND, and Dresses which was essential to a feminine brand like Somethin’ Sweet.

On performance by brand, ÅLAND positioned itself well with the right newness, driving equivalent sell-out across all categories.

Somethin’ Sweet, on the other hand, observed missed opportunities on Tops, as there was a higher sell-out contribution than new-ins by +5% percentage points. Meanwhile, Outerwear was slightly over-stocked with sell-out contribution underperforming new-in by -6% percentage points.

Category Analysis: Non-Apparel

Bags and shoes were the primary categories to dominate the non-apparel segment across the retailers. ÅLAND surprisingly had a more extensive assortment in Jewellery than Somethin’ Sweet. Observing trending styles, these jewellery included mismatched earrings, tassel earrings, stacked rings and link-chained bracelets.

 

Same Categories, Different Contribution by Brand

The key non-apparel categories demonstrated a relatively healthy New-In against Sell-Out performances. Bags in ÅLAND was the top category with 63% newness, while the same category came in second for the feminine-styled Somethin’ Sweet, vice-versa for Shoes.

An Overview on Sizing

Korean brands are notoriously known for their “free size” or “one size” on apparel. “Free size” largely dominated both retailers analysed, especially in Somethin’ Sweet. The contribution commanded as high as over 90% of key categories in the feminine brand, namely for Tops, Dresses and Outerwear. Meanwhile, ÅLAND had less than 40% of its assortment in “free size” across Tops, Outerwear and Activewear. ÅLAND also had higher ratios of sizes M and L contributed by menswear.

 

Made For Asians

While ”free size” is loosely perceived as fitting a regular size M, Korean brands translate it to the equivalent of international size S[1], which is below the average global size fit. Yet, “free size” largely fulfils the demand of local consumers as well as for the most part of Asia, especially China.

 

Chart 10: Women’s Apparel Size Chart

 

Note: [1] Korean Clothing Sizes – Know Before You Shop!

The Leading Brands: ÅLAND

Bestsellers from the top 5 performing categories were dominated by the popular brands listed below:

 

Top 5 Brands

  1. Lejunev
  2. Heys
  3. Soooho
  4. Bc by beyondcloset
  5. Apartment

 

Street style fashion centred upon dressing in casual and comfortable clothing that embraced urban elements and Korean street fashion.

In contrast to the sporty treatment upheld by adidas track jackets, a different variation of athleisure wear was defined in ÅLAND. Breaking away from the typical track jacket appearance, Apartment, one of ÅLAND’s leading brands, designed its trending look with a jacket that closely resembled a casual hoodie.

 

The Leading Brands: Somethin’ Sweet

Bestsellers from the top 5 performing categories were dominated by the popular brands listed below:

 

Top 5 Brands

  1. Dabagirl
  2. Chuu
  3. Uptownholic
  4. Mocobling
  5. Cherrykoko

 

Pieces that encapsulate femininity comprised of flowy and flared garments with a touch of lace, accentuating the elegance that is generally associated with women.

Conclusion

Main Findings

Strong Trade Performance: Korea’s swift production line, from design to retail, has existed for years – even before Korean fashion made its mark across the globe. New designs and trends were launched at lightning speed and consumers scooped them up at an almost matching rate.

Omnilytics’ analyses on the two ambitious retailers of South Korea proved that with outrageously high new-in of over 90% in the year 2018, combined sell-out rate delivered an impressive 87% with 72% at full price. There was little to suggest signs of inventory overstocking issues or the need for forced discounting, primarily seen in the Western counterpart.

 

Gender Neutral: Feminism has presented itself in Korean fashion through the means of defying the boundaries of stereotypical gender-labelled clothing and diverging towards a more gender-neutral approach. The rise of streetwear further blurred the lines of gender specification – most evident in ÅLAND with a strong 61% contribution of unisex assortment.

 

Korean Sizing: Despite targeting global consumers, Korean brands do not appear to adjust their current “small” Asian sizing to meet universal demand. This move could ultimately hurt plans for expansion, as ÅLAND’s first store in Brooklyn has drawn flak on its size system by Insider upon visit.

 

Next Steps for Retailers and Brands

Measure and Monitor: Routinely measuring and monitoring key performance metrics is crucial to trade success. Aside from the usual sales against inventory analysis, the measure of sell-out against new-in demonstrated in this report presented an additional perspective to indicate early signs of overstocking issues or missed opportunities.

Brands should be proactive to forecast and re-forecast the quantum of newness and adjust the phasing of launches with each analysis to stay ahead of the game.

 

Brand Ethos: One of the key success factors of Korean marketplaces or brands can be attributed to having a strong brand identity – ÅLAND’s authoritative streetwear and gender-neutral assortment, and Somethin’ Sweet’s pronounced charming and feminine styles. The leading brands curated by each respective retailer collectively amplify and strengthen its identity and positioning.

 

“One size” does not fit all: While the single size approach made possible for lightning speed production and sold well amongst the local Korean consumers, retailers and brands eyeing for global expansion, especially the West, need to adjust their design or purchase plans to cater to the relevant consumers.

Having access to data is important to analyse competitors’ performance on sizing, to determine the right sizing grid that best meets demand and to avoid overstocking.