Nike Style retail concept store will help Nike diversify sales mix in $67 billion South Korean apparel market, says GlobalData

American sportswear brand Nike has recently opened its first ‘Nike Style’ retail concept store in the world in Seoul, South Korea. Through this concept store, the fashion giant looks to diversify its sales mix and capture a slice of the fast-growing $67 billion apparel market in South Korea*, says GlobalData, a leading data and analytics company.

Bobby Verghese, Consumer Analyst, at GlobalData, comments: “Nike Style is designed to showcase the brand’s sports retail styles, and boost consumer interaction with products to spur purchase. For instance, the store has a gender-agnostic apparel shopping zone, which can appeal to 48% of South Koreans who feel that gender equality is a quite/extremely important matter**.”

An in-store digital content studio allows visitors to create social media content related to Nike’s brand and products. Moreover, shoppers can scan QR codes around the store to access augmented reality (AR) experiences with the products and artistic installations.

Such tech-driven features can attract 37% of South Korean respondents, who, in GlobalData’s 2022 consumer survey***, said that they are often or always influenced by how digitally advanced a product or service is.

The company plans to conduct ‘Nike by You’ workshops and SNKRS Lounge events for the Nike community to boost customer footfall and interaction with the brand. Events such as these can stimulate sales, given that 74% of South Korean consumers who find new experiences associated with product purchases an essential or a nice-to-have feature when making a purchase***.

Verghese adds: “South Korea is currently Nike’s fourth largest market by value in Asia after China, India, and Japan*. This is partly attributed to Nike’s mass-market price positioning, as 62% of South Koreans buy apparel from mass/middle market brands as per GlobalData’s 2022 survey****. Moreover, 79% of respondents felt that products made by foreign/global multi-national brands were of good/excellent quality***.”

Hence, there is ample room for growth for Nike in the South Korean market as the confluence of the prolonged homestay, the work-from-home trend, and the growing fitness craze due to COVID-19 has boosted demand for sportswear.

This is validated by GlobalData’s 2022 Q1 survey**, wherein 23% South Korean respondents said they spent more on sportswear in 2021 than 2020, and 38% affirmed that their spending on the segment remained unchanged over both years.

Verghese concludes: “Nike Style will complement the company’s Nike Rise concept store in Seoul, which delivers an immersive offline-online shopping experience that motivates consumers to take up sports. The Nike Style and Nike Rise concept stores can aid the company in diversifying its sales mix in South Korea, where footwear contributes two-thirds of value sales*. Nike plans to replicate the Nike Style concept across the world, beginning with an outlet in Shanghai, where consumers are tech-savvy as in South Korea.”

*GlobalData 2021 Q3 Consumer Survey—South Korea, published in September 2021

**GlobalData Apparel Intelligence Center—Market Analyzers, accessed in July 2022

***GlobalData 2022 Q2 Consumer Survey—South Korea, published in June 2022

****GlobalData 2022 Q1 Consumer Survey—South Korea, published in March 2022

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