E-Mart Business Hours Adjustment Notice. Provided by E-Mart
From the 3rd of next month, large marts such as E-Mart and Homeplus will shorten their nighttime business hours by an hour, raising the possibility that consumers will switch to online commerce in large numbers. Analysts say that if business hours are shortened to 10 p.m., consumers who cannot quickly purchase goods during that time will move to major online retailers that provide fast delivery services.
While online retailers are strengthening their nighttime operations to catch customers who have lapsed from large marts, large marts such as E-Mart are planning to expand their online shopper incentives by strengthening daytime peak time promotions. As a result, the industry predicts that the reorganization of the distribution market in the structure of ‘online night shopping vs daytime mart shopping’ will accelerate.
◆What if I can’t buy groceries at the mart at night? Customers likely to flock to online commerce with early morning delivery
According to the industry on the 31st, starting on the 3rd of next month, E-Mart plans to advance the closing time of its stores nationwide from 11:00 pm to 10:00 pm. Homeplus will also shorten the closing hours of its 24 stores across the country, including the KINTEX and Gimpo stores, to 10 p.m. Lotte Mart is also known to be struggling to shorten its business hours.
The successive reductions in business hours in the hypermarket industry are interpreted as the burden of store management costs. This is because it is judged that the efficiency of late-night business hours has decreased due to rising labor costs and electricity rates. The fact that the number of customers visiting offline stores such as large marts and supermarkets has decreased due to the activation of online shopping also had an impact.
E-Mart’s sales last year increased by 17.65% to 29.3335 trillion won, but its operating profit was 145.1 billion won, down 54.2% from the previous year. According to E-Mart, the proportion of customers who visit after 10 pm is 3%, down 1.4 percentage points from 2020 (4.4%).
An official from a large mart said, “The reduction in business hours was a measure taken as the proportion of customers visiting the store at night decreased while the number of customers visiting during peak hours increased.”
Although large marts do not disclose the specific number of visitors, the industry expects that many of the visitors who visit the mart after 10 p.m. will move to online shopping due to this measure. As a result of an analysis of T-map users by TDI, a big data company, E-Mart (1,736,000 units) ranked first in terms of mart visitors (number of vehicle arrivals) in December last year, followed by Homeplus (973,000 units) and Costco Wholesale ( 711,000 units), followed by Lotte Mart (613,000 units).
Based on this, if we calculate the situation of E-Mart, where the proportion of visitors after 10 p.m. is 3%, it is estimated that the reduction in business will reduce the number of visitors (about 50,000) by 50,000 vehicles per month. According to the National Statistical Office, the average number of household members in Korea is 2.3, which means that 50,000 to 100,000 people will be missing assuming that two people per household visit the mart in one vehicle.
An official from the distribution industry said, “If the business closes at 10:00 pm, the number of customers who visit the mart between 9 and 10:00 pm may decrease slightly.” If we do, the number of customers leaving the hypermarket could increase significantly,” he predicted.
It is analyzed that a significant number of customers who have left the mart are more likely to flow into online distribution services that are available 24 hours a day, 7 days a week. In particular, 10:00 pm to 12:00 pm is regarded as a golden time when consumers flock to online commerce. Rather than open market shopping malls with late delivery, there is a possibility that more customers will increase at Coupang and Market Kurly, where you can order fresh food by early morning delivery the next morning by placing an order by 12:00 in the evening or at night.
In the case of Coupang, ‘Time Deal’ allows you to purchase fresh food from early morning delivery at low prices between 10:00 and 12:00 p.m., before the deadline for early morning delivery (midnight), and offers huge discounts on hundreds of products every night for paid membership WOW members. The corner was held, but this action is expected to strengthen the discount promotion policy for that time slot.
Courtesy of Curly
E-Mart and Lotte are defending against consumer churn by advancing food discounts
However, as hypermarkets that have shortened business hours are conducting intensive promotions during the peak hours of 2:00-6:00 p.m. and early evening, it is unclear whether consumers who have left hypermarkets will be absorbed online.
As a result of the adjustment of business hours, E-Mart moved the ‘dinner food discount’, which is considered the highlight of night shopping at the mart, from 8:00 pm to 7:00 pm. Homeplus announced that it would intensively conduct promotions from 6:00 to 8:00 in the early evening. Lotte Mart is also planning to advance its night discount sales, and plans to implement a pre-discount policy even from 2 to 6 p.m.
E-Mart is known to account for about 40% of its total sales from 2:00 p.m. to 6:00 p.m., considered peak time. The plan is to increase the proportion of sales during peak hours by strengthening promotions.
As offline hypermarkets strengthen daytime and early evening marketing to defend against sales declines due to consumer departures during the night, marketing competition to attract consumers is expected to intensify between hypermarkets during the daytime and early evening and online commerce companies at night.
Lee Eun-hee, a professor of consumer studies at Inha University, said, “Business hours will be shortened by an hour, but as a result, competition in the online and offline distribution market is expected to intensify.” However, counterattacks by hypermarkets that will strengthen their targeting of peak-time customers before night time will not be easy,” he analyzed.
Reporter Kim Soo-yeon [email protected]
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