South Korea’s economy has had a good run. From the rapid growth in the 60s and 80s to pioneering chaebols, it’s been great, but as the pace slows and growth appears limited, the food and distribution industries are turning to big data technology.
While 29% of global companies utilize big data, Korean companies (currently dwindling at 5%) are now responding to consumer buying behavior and youth trends in a lightening fast way, prompting the creation of new products.
Korean Convenience Store & Snack Culture
Last year’s national Honey Butter Chip craze was only the tip of the snack-culture-iceberg. 24 hour convenience stores line the streets virtually everywhere, and are packed with a huge selection of crackers, biscuits, potato chips, instant noodles, rice crackers, lunch boxes, coffees, beers etc the list is endless.
Here, the standard of delicious and exciting instant food (and all food in general) is very high.
Big Data Products
Kimchi stew flavored potato crisps are latest product of big data research. Convenience stores found that many people bought potato crisps with kimchi instant noodles together, so the two were combined and the kimchi-potato hybrid was born.
Research also found that mini Yakult bottles (see image below) were bought in bulk, as the quantity was too small. As a result, the king-sized yogurt drink was released, so that customers could enjoy the flavor all in one go.
Bento-like lunchboxes have been hugely popular due to the honbab movement. These packaged meals are filling, high quality and convenient. However, consumers tended to buy them with a refrigerated desert, so now some lunchboxes have a built in cheesecake for the sweet-tooth to enjoy.
How Do They Keep Up With Trends?
Everyone is engaged in at least one social media platform (Facebook and Instagram being the most popular). So social media has been a great way to keep a pulse on what people are buying.
After analyzing 4.1 billion comments on social media, convenient stores found that Korean consumers ate dumplings with beer (which is an unconventional combo). As a result, beer and dumplings are advertised together and, convenience stores raised the sales of dumplings even during the off-season in summer.
Young Seoulites are a snappy happy crowd; happy to document their life and share what they consume with others using various hashtags, especially female Millennials. By simply searching #GS25 or #세븐일레븐 (7-Eleven) you can see what products are trending and popular.
Cards and Buttons:
Supermarkets and convenience stores have their own point card, which saves consumer data. But, as many people don’t bother to own a point card, there is a lot of data being passed under the radar.
Instead, the cash register is equipped with different buttons for the age and gender of the customer. So the cashier simply selects a button based on the customer’s appearance. In the clip above, as the woman purchases ramen, the cashier selects ‘Female 20s’
Collaborations & Private Brands
Convenience stores have been utilizing their data and collaborating with big food brands for a while now to create good quality products designed to fit current trends and consumer desires.
GS25 collaborated with Yakult Korea to create the giant yakult (see above), and they collaborated with Orion to create Kimchi Stew ramen, which has consistently ranked number 1 out of convenience store ramens.
7-Eleven collaborated with Dongwon F&B (known for their canned food) to create a Dongwon tuna ramen, as consumers enjoyed adding meats into instant noodles to give deeper flavor and richness.
Not only are they collaborating with big labels (which already have consumer loyalty), but convenience stores are launching their own private brands to create various new products of their own. The convenience store GS25 launched a private brand called You Us in February of this year. From GS25’s data and You Us created the Kimchi Stew flavored potato chip.
Big Data: Hit Or Miss?
There is a higher chance that new food items will be a hit if it is already desired by the public, however taking consumer behavior too literally might not always spell success.
For instance, consumers may have bought and consumed the small yakult bottles in bulk because the sizes were too small, but it was also a fun way to control portion sizes. Many people have just stuck to buying the small bottles, because controlling the calories is easier and some even say that the small bottles are part of the charm and the flavor seem too sickly sweet in large doses.
Now And Beyond
It’s a very exciting time to be a consumer in Korea right now. Services and products are constantly adapting to your tastes and desires, and the constant flow of new trends and items is definitely fun. Many people are eagerly awaiting the new hybrid snack, and maybe one day we will have a Willie Wonka-like chewing gum that tastes of Korean barbecue.
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