Food retail and different channels
Grocery supermarkets led the food retail industry in South Korea, with food sales amounting to over 36 trillion South Korean won. Grocery supermarkets have gained popularity by selling locally grown agricultural and livestock products at discounted prices while maintaining quality. Based on the number of units nationally, Hanaro Mart by Nonghyup (National Agricultural Cooperative Federation), was the leading grocery supermarket chain in 2021 with over 2,200 stores. While other offline retailers such as hypermarkets or super supermarkets (SSMs) experienced a slump in food retail in 2021, convenience stores and department stores saw a sales growth of food retail.The South Korean online food market grew notably in 2020 and 2021, as more and more people switched to online shopping amid the COVID-19 pandemic. Over the past years, consumer confidence has also increased as large retail brands and food specialists entered the online grocery market. Food companies have developed logistics and delivery systems as competition in the online market has intensified. For example, the heightened usage of open market service Coupang and its Rocket delivery which enables consumers to receive their products within 24 hours, illustrates this increase in the number of consumers who want to buy fresh food online.
Korean consumers' shopping carts
Korean consumers are spending more on food each year. The average basket size of Korean consumers was the largest at discount stores, however, their favorite grocery shopping channels were large supermarkets and neighborhood grocery supermarkets where they could easily visit at any time. A recent survey found that most consumers still tend to shop for groceries in physical stores rather than online. However, when asked about their online purchase behavior during the COVID-19 pandemic, most of the respondents answered that they purchased more online during the pandemic. Also, food and groceries were increasingly purchased online compared to before the pandemic. Given the high usage of general online shopping and the country’s well-established delivery system, the South Korean online grocery market is likely to grow further.
