Irene Kim, a 38-year-old Korean staffing agency owner and avid luxury consumer, is a working mother of two who now shares her passion for designer clothes with her kids.
Kim, who lives in Dongtan, an industrial area south of Seoul, recently bought a 780,000 won ($560) silver necklace from Tiffany & Co. for her 4-year-old daughter and a pair of Golden Goose shoes for her 18-month-old second daughter for 380,000 won.
“I don’t want my kids to look shabby when we go to weddings, birthday parties, or music concerts,” Kim says. “As long as my kids can run around comfortably in these clothes and shoes, I don’t care about the price.”
She recently purchased several luxury items for her children, including a Moncler jacket and shirt, a Burberry dress and pants, and a Fendi gown and shoes.
As South Korea becomes more prosperous, with the country having the world’s lowest birth rate according to the World Bank, more parents are spending on luxuries for their small families.
“South Korea’s birth rate continues to fall, but the luxury market for children continues to grow,” said Lisa Hong, beauty and fashion consultant at Euromonitor. “Koreans love to show off. They can’t stand not being able to do what everyone else is doing. Many families only have one child, so they choose the best for their children, which leads to a younger age for their first luxury purchase.”
According to Hong, when measured by per capita spending, China is one of the three fastest-growing markets for premium children’s clothing in the world, with a compound annual growth rate of more than 5 percent over the past five years, according to Euromonitor, third only to China and Turkey.
This is a positive sign for the luxury industry, as Gucci reported this week that its sales in Asia fell sharply and LVMH’s second-quarter sales in Asia ex-Japan fell 14 percent.
“Korean society is very competitive and people want to stand out, and luxury goods have become a good tool for that,” said Lee Jong-kyu, president of Etro Korea and former president of Dior Korea. “Moncler winter jackets have become like school uniforms for teenagers.”
Irene Kim said she didn’t want her two daughters to look “shabby” when they were out and about. © Lee Jae-Won/FT
Department stores are rushing to open luxury children’s stores, with Lotte, Shinsegae and Hyundai reporting double-digit growth in luxury children’s sales in 2023 despite a slowing economy and rising inflation.
Sales of Hyundai and Shinsegae’s premium children’s brands jumped 27 percent and 15 percent, respectively, last year. Lotte said sales of premium children’s products such as Bugaboo strollers and Stokke baby high chairs rose 25 percent.
“Due to low birth rates, parents, grandparents, uncles and aunts focus their attention on one child in a large family and are willing to spend money on that child,” a Hyundai spokesman said. “We expect this trend to continue, so we will continue to expand our premium stores for children.”
Koreans account for about 10% of global sales for top brands such as Prada, Moncler, Bottega Veneta and Burberry, according to a 2022 Morgan Stanley report. In Seoul, it’s not uncommon to see people camping outside department stores overnight to be first in line to buy new items as soon as they open.
Tiffany & Co. and Spanish fashion brand Loewe are opening new stores in Seoul’s affluent Cheongdam district in an attempt to cash in on the luxury boom, while Swiss luxury watchmaker Richard Mille opened a refurbished store in the same area this month.
Irene Kim’s children have many pairs of shoes from top designer brands © Lee Jae-Won/FT
Bank of Korea Governor Lee Chang-yong said in June that South Korea’s craze for branded goods was eroding price elasticity and making it harder for monetary policy to curb inflation, adding that Koreans exhibit a “rare tendency to rush to buy certain brands when they become popular.”
Young people who grew up with expensive gifts and are frustrated by soaring housing prices are joining the country’s luxury boom. Brands are targeting people in their 20s and 30s by tapping K-pop stars, from BTS to BLACKPINK, as ambassadors. In South Korea, people in their 20s have seen the fastest growth in luxury purchases of any age group, according to Lotte’s 2022 report.
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“Advertisements featuring K-pop idols make young people want luxury products and imprint these luxury brands in their minds,” Euromonitor’s Hong said, adding that influencers who brag about their luxury shopping experiences on social media have also fuelled the trend.
BY Uhm, a businesswoman living in Jamsil, an affluent district of Seoul, is worried that her 17-year-old daughter, who was given expensive items by her grandparents from a young age, has a penchant for luxury goods.
They recently bought her a pair of 800,000 won sneakers, a collaboration between Asics and Marc Jacobs, for her birthday.
“I worry that my daughter will become so used to these luxury items that it will be hard for her to get a job in the future that will allow her to buy them,” Om said.
