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Legacy fashion brands overshadowed by sportswear, luxury goods makers

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By Kim Jae-heun

Korea's fashion industry has been undergoing drastic changes in recent years as traditional apparel brands run by large business groups are increasingly losing luster to sportswear makers and foreign luxury brands, according to industry officials.

The so-called "big 3" fashion firms ― Samsung C&T Fashion Group, LF and Kolon FnC ― have recently been losing their market shares to sports brands like Fila and Adidas and international luxury firms like Louis Vuitton and Gucci.

In addition, these past two years, many online fashion platforms have been growing rapidly amid the pandemic. These changes are said to have had a significant impact on the decline of the big 3's market shares, the officials said.

According to market watcher Euromonitor, Japanese retailer Uniqlo and Samsung C&T's fashion brand Beanpole have been reigning as the top two largest fashion firms here for the past five years. However, Samsung C&T Fashion Group has barely maintained its status as the top fashion company in recent years and its Beanpole brand is fading into the shadows.

Beanpole held a 2.5 percent market share from 2017 to 2019 but it fell to 2.4 percent in 2020 and 2.3 percent in 2021.

Samsung C&T collaborated with high-profile Korean fashion designer Jung Kuho to revitalize Beanpole in line with the brand's 30th anniversary in 2019, targeting young customers. Jung launched the sub-label brand 890311 under Beanpole, but it failed to grab public attention and went out of business last year.

A market insider said Beanpole's sales have been increasing at a slower rate than the overall fashion market, leading to its slowly declining market share.

"Fashion brands' sales grow as the market gets bigger, but their market share is falling because their growth rates do not keep up with that of the overall fashion market," Euro Monitor researcher Moon Kyung-sun said.

In 2021, the size of the domestic fashion market reached 43.3 trillion won ($33.2 billion), up by 7.5 percent from the previous year.

However, Samsung C&T's fashion unit dismissed its recent struggles by saying that it has shown a rebound since the country began to reopen after a relaxation of COVID-19 quarantine measures. "The company managed to make a breakthrough in the first half of this year so we are not worried about newcomers. We expect to see double-digit growth in the second half of this year," a Samsung C&T Fashion Group official said.

LF, Kolon FnC business also on downtrend

Kolon FnC's leading fashion brand Kolon Sports is also losing its market share. In 2017, Kolon Sports was the fifth-largest local fashion brand with a 1.7 percent of market share, but it fell to 1.4 percent last year, placing it ninth in the rankings.

LF's fashion business has also been stagnating.

Its biggest fashion brand Daks has been maintaining a 1.9 percent market share for three years since 2019. LF's other fashion label, Hazzys failed to keep its 0.8 percent market share, which it reached in 2017, with it falling to 0.7 percent in 2020.

"It is true our fashion brands did not do well during the pandemic, but they have shown quick recovery recently. For Hazzys, its revenue created between April and May soared by over 30 percent year-on-year," an LF official said.

Fila, Adidas chase after big 3 aggressively

Sports brands Fila and Adidas are closing in on the lost market shares of the big 3. Fila successfully boosted its share from 1 percent in 2017 to 2.1 percent in 2020 and 2021 to become the third largest fashion brand here. Adidas is just behind Fila with its market share increasing from 1.7 percent to 2 percent in the same period.

"In the wake of the pandemic, many people are coming out to enjoy outdoor activities. Here, sports brands have targeted young customers who enjoy outdoor sports like golf and tennis. Also, sports brands have started to make clothing suitable for daily wear, whereas before they focused only on functionality of the products. This is leading the sports brands' sales to increase," a sportswear firm official said.

For luxury brands, French designer Louis Vuitton recorded a 0.2 percent market share last year from 0.1 percent in 2020. Gucci also raised its market share from 0.4 percent five years ago to 0.6 percent last year.

"Luxury firms' sales in the past two years have soared significantly thanks to the 'revenge consumption' trend triggered by COVID-19. Because people were unable to travel abroad, they spend money on luxury goods instead. Luxury firms benefited the most from the pandemic because people would not have bought such expensive handbags and clothing if they had the option to travel overseas," a luxury fashion firm official said.

Kim Jae-heun


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