South Korean fashion giant LF is turning to social media recruiting and internal startups to cater to millennial and Gen Z customers.
The company's subsidiary CTDOTS, the force behind casual streetwear brand Dunst, is expected to achieve annual sales of 40 billion won ($30 million) for the first time since it was founded as an in-house startup for LF in 2019.
Dunst is mostly sold on online fashion shopping platforms such as Musinsa, 29CM, and W Concept, where a majority of its customers are in their twenties and thirties. The brand approaches marketing with discretion - hiding the fact that Dunst is an LF brand - to break away from LF's traditional image as a fashion brand for middle-aged men.
Dunst was conceived four years ago as an in-house startup when LF vice chairman Oh Kyu-sik assigned Yoo Jae-hyuk, head of the fashion research team, to create a new brand from scratch. The goal was to come up with a brand that would attract millennial and Gen Z customers.
The brand operated autonomously without any interference from headquarters, with decisions regarding its name, design, and marketing made independently without the approval of LF executives.
The strategy has so far been successful. Dunst has grown more than 100 percent every year since its launch, and turned profitable in less than two years. The brand is on track to reach 40 billion won in sales this year.
"The brand's popularity marks a milestone in the industry as the first casual streetwear brand successfully launched by a fashion conglomerate like LF," said an industry insider. "The brand's unique approach to branding and recruitment has set it apart in the competitive fashion industry."
Yoo Jae-hyuk, who spearheaded the growth of Dunst, recruited talent through Instagram. He scouted twenty-somethings who majored in various fields such as fashion, architecture, photography, and graphics. He made the unconventional choice to use social media as a hiring platform to find people who could bring their unique tastes and talent to the brand.
In response to the initial success of Dunst, LF spun off CTDOTS into a new entity that resembles a startup with stock options and bonuses for employees. The company appointed Yoo Jae-hyuk as the CEO of CTDOTS in 2021 so that Dunst could be run independently from LF.
An LF official noted that the achievements of Dunst have sparked a wave of enthusiasm among younger employees. "Many employees are also dreaming of creating fashion brands, and this new energy is changing the company's previously stagnant work culture."
This article was originally published on Nov. 14, 2023.