The influence of "K," once represented by "K-pop" and "K-dramas," is spreading worldwide across multiple retail industries. In the past, localization was considered essential when expanding overseas, but now Korea's unique methods and sensibilities are being accepted as a new standard. We highlight cases where what is Korean has become a global competitive edge and examine the direction "K" should take in the global market. [Editor's note]
Downtown Honolulu, Hawaii, on Dec. 10 last year. In this place of warm breezes and rows of palm trees, a familiar sign you might see at the entrance to a Korean neighborhood came into view. It was the sign for the CU Downtown store, a convenience store that opened there in Nov. last year.
Opening the door and walking in felt like teleporting to a Korean convenience store. In front of the cashier, tourists speaking Spanish, English, and Japanese stood holding purple shopping baskets. The baskets held triangle kimbap, highballs, and ramen. Hanoka, 42, who traveled from Japan, said, "I bought some things to eat while hanging out at Waikiki Beach," and noted, "I chose mainly what I had eaten on my trip to Korea."
The saying that "retail cannot cross borders" is slowly being upended. This assessment follows the continued strong performance of convenience stores armed with K-food and K-lifestyle in overseas markets. Department stores that had bitter experiences abroad in the past are also revising strategies to target overseas markets again. The success formula that worked more than a decade ago has changed. The Korean Wave is even reshaping the playbook for convenience stores and department stores going abroad.
◇ K-convenience stores and department stores branch out overseas
Convenience stores are widening their reach into overseas markets. According to BGF Retail, which operates CU, on the 1st, CU opened its first store in Mongolia in 2018 and has recently expanded to 532 locations. In Malaysia, where it entered in 2021, it has opened 167 stores. CU has opened 50 stores in Kazakhstan, where it expanded in 2024.
CU recently entered Hawaii as well. Although it is a new store that opened in Nov. last year, travelers visiting Honolulu, Hawaii, tend to stop by three places: the U.S. convenience store "ABC Store," Japan's retailer "Don Quijote," and Korea's CU convenience store.
GS25 also entered Mongolia in 2021 and now has 284 stores. Its Vietnam presence, launched in 2018, has grown to 402 stores. Emart24 has opened a total of 111 stores in Malaysia and Cambodia. Last year, Emart24 entered India, and, judging it has gained a foothold, plans to open a second store this year.
It is not only convenience stores that are crossing borders. Department stores are seeking overseas expansion by selling content. The start came from Shinsegae Department Store. In May 2023, Shinsegae launched "K-Fashion82," a global platform for domestic fashion designer brands, producing visible results. In Nov. of that year, it operated a "K-Fashion82" pop-up store for two months at Siam Discovery in Thailand, introducing brands such as "Alice Martha," "Lymelight," and "RYU Classic" to the Southeast Asian market and working to boost sales.
Hyundai Department Store's K-content export platform "The Hyundai Global" pop-up stores are also posting solid report cards. Presented in pop-up form, The Hyundai Global's introduction of Korean content powered by the Korean Wave has generated a cumulative 5.7 billion won in Japan, Taiwan, and elsewhere. The pop-up store operating at Shin Kong Mitsukoshi Department Store in Taipei, Taiwan, recorded a cumulative 1.2 billion won in sales within two months of opening. It is the highest sales in that department store's pop-up history. During the same period, the number of visitors exceeded 30,000.
◇ The old success formula has changed
Retailers' pushes into the global market were in fact active in the 2010s. They did not succeed, however, due to stagnation in local market growth and other factors. In Korea, Carrefour entered but conceded defeat as it could not match the competitiveness of Emart or Lotte Mart. Management gurus at the time vied to say localization was most important.
Recently, our retailers' success strategy has shifted to the "Korean style." The CU store in Hawaii adopted the "ramen library" format showcased at the CU Hongdae Imagination store in Korea exactly as is in the Hawaii location. This was at the request of the local partner. A ramen library is a space where hundreds of types of packet ramen are displayed together and various experiential content symbolizing Korean ramen culture is introduced. Along with an instant cooking device, often called "Hangang ramen," it provides a tasting station and a ramen index by Scoville heat units and other metrics.
The CU Downtown store in Hawaii also sells the same products carried by Korean convenience stores. Triangle kimbap such as Jeonju bibim and tuna mayo are representative. According to BGF Retail, in Dec. last year, 40% of the top-selling items at CU's Honolulu Downtown store were in the kimbap category. A BGF Retail official said, "We see this as a change driven by a rise in foreigners who have traveled to Korea and a broadening preference for Korean food."
There has also been a shift from defining retail as real estate, starting by searching for buildings and land. In the past, companies attacked markets by rapidly increasing the number of stores in a short period. Or they began in the most fiercely competitive locations, which was the prevailing success formula. Now, retail has transformed into a content business. Companies are entering lightly in pop-up form.
Hyundai Department Store led with "Stand Oil" and "NOMANUAL," brands worn by K-pop idols. They are brands frequently worn by Blackpink's Jennie and SEVENTEEN and other popular idols. Riding the Korean Wave, it also built a premium and luxury image. Observers say this has led to higher spending per customer.
◇ Retailers tighten reins on overseas expansion, backed by the Korean Wave
Retailers' attempts to expand their markets on the back of the Korean Wave are expected to continue. If successful, they can overcome the growth slowdown caused by saturation in the domestic market. Another key reason is that the status of the Korean Wave has shifted from a subculture enjoyed only by specific fandoms to a mainstream culture consumed in everyday life around the world.
Kim Nan-do, an emeritus professor in the Department of Consumer Science at Seoul National University, said, "CJ Olive Young and convenience stores are not just places that sell Korean products; they are recognized by local consumers as 'cultural hubs' where they can encounter Korea's latest trends first," adding, "The export of spaces has begun."