Lotte Duty Free Uses Japan’s Visa-Free Reopening To Tourists To Pump Up Korean Sales

Lotte Duty-Free has increased its promotional activity in core South Korean retail outlets due to Japan’s decision that international visa-free travel is now possible. However, proof or negative PCR tests will still be required. This move opens up new avenues for duty-free sales both in the duty-free retailer’s home market and in Tokyo, where Lotte operates a large shop.

Japan opened its doors to tourists on June 10, 2022. However, strict rules were still in place. The daily limit for arrivals was 50,000, and travelers had to be part of a planned package tour. There will be no limit on appearances, and people can enter the country visa-free starting October 11. This is expected to increase South Korean demand. Pre-covid, 60+ nationalities were allowed to travel to Japan with no visa. They could stay up to 90 days. However, the program was stopped during the pandemic because of strict safety precautions.

Lotte Duty-Free has had a 47,400-square-foot department store in Ginza since 2016. It has been Japan’s most popular shopping destination. In recent months, sales have nearly tripled year-over-year. The company is trying to revive the travel bug, as Chinese and Koreans tended to shop and travel in Japan before the pandemic.

With over a million visitors to Japan in August 2019, the Chinese were the most popular nationality, while Koreans came third behind the Taiwanese. Although the total number of arrivals to Japan in August was down significantly from 2.5 million in August 2019, it is now second behind Vietnam. However, they were still a top choice for Koreans.

Lotte Duty-Free will offer three-day, two-night round trips from Korea and Tokyo on Korean Air. This is on a first-come, first-served basis. Five customers who spend over $500 in Korean stores will win the trip for two.

Mini-promotions to highlight travel to Japan

Gap Lee, CEO of Lotte, also stated that Lotte would host various events for local customers, emphasizing Japanese products. The retailer will offer travel products at affordable prices as part of a ‘live commerce activity’ called ‘LDF Travel, Love Duty-Free’ in partnership with NHN Travel Doctor.

Lotte Duty-Free at Tokyu Plaza Ginza was opened in 2016. It was a significant event in the company’s history.

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Domestic customers planning to travel to Japan will find various mini promotions until November. These prizes can be as low as $3.50 (5,000 Korean won) and include prizes credited to LDF Pay, a payment platform launched in 2019, on most purchases made in downtown duty-free shops.

Customers who post reviews on their trip to Japan on Lotte Duty-Free’s website can win credits for more significant amounts. The KakaoTalk messenger will allow you to purchase $35 (50,000 Korean won) LDF Pay coupons at a 30% discount.

This giveaway is an excellent way for retailers to increase footfall on their websites and downtown duty-free shops in Korea. Lotte Duty-Free reports that sales have rebounded strongly in the last quarter. The retailer spokeswoman said that despite the high exchange rate, domestic sales have increased by 230% in the last three months, differentiate from the previous year. We expect this upward trend to continue.”

Japanese aspirations revived

Due to the low tourist traffic, Japan’s trend has been quite different. Lotte Duty Free had ambitious plans to open up to four to five stores in Japan that were similar to the Tokyo flagship. The company anticipated that these outlets would generate sales of one trillion won (roughly $700 million) in a decade.

Lotte’s Ginza store is undergoing promotional activity in South Korea as part of its strategy to encourage more Japanese tourists to Japan. There are luxury brands that include watches, jewelry, and cosmetics, as well as electronics and accessories. These luxury brands also include K-beauty labels and K-fashion labels. This was a popular choice for Chinese tourists who, with some exceptions, are restricted to their borders.

Lotte Duty-Free recently opened a store in downtown Sydney, Australia. It claims it also targets sales of a trillion Korean won in a decade.

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Adam Collins
Adam writes about technology, business and economics. With master's degree in Economics, he's presented six papers in international conferences. As a solivagant in the constant state of fernweh, curiosity is the main weapon in his arsenal.

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