Foreign Tourists Fuel Rebound of High-End Retail in Department Stores in Seoul, South Korea: What New Updates You Need to Know

Foreign Tourists Fuel Rebound of High-End Retail in Department Stores in Seoul, South Korea: What New Updates You Need to Know

Foreign Tourists Fuel Rebound of High-End Retail in Department Stores in Seoul, South Korea: What New Updates You Need to Know

The flagship department stores in Seoul are positively bouncing back as spending by foreign tourists skyrockets and high-end retail takes off. After a long domestic spending slump, department stores in the Myeongdong area, like Lotte and Shinsegae, have recorded a new high in sales, primarily due to foreign tourists.

The Korea Tourism Organization states that South Korea received almost 19 million international travelers in 2025, marking a record in the country’s tourism history. This, coupled with the weaker Korean won, has resulted in a boom in retail, especially luxury and high-end retail.

Record-Breaking Growth for Department Store Sales

Lotte Department Store‘s flagship store in Myeongdong has seen foreign customer sales increase by four percent to nineteen percent. In the last three years, foreign spending has increased by forty percent, proving the allure the city’s premium stores have for foreign buyers. For 2025, Lotte’s foreign sales are projected to be 700 billion won (approximately 480 million USD), making up part of the 3.21 trillion won total sales, with an operating profit of 491 billion won, which is an increase of 22.5 percent from last year.

Shinsegae Department Store has also had foreign customer sales increase significantly, moving from seven percent in 2023 to 18.5 percent in 2025 at the Myeongdong flagship store. Foreign spending is in the mid-600 billion won range, representing an increase of 3.5 times from the previous year. Additionally, foreign purchases of luxury items rose by up to 67 percent in the last six months of 2025, demonstrating the rising interest in high-end goods from overseas customers.

Effect of Weaker Won & Increased Tourism

The increase in international tourism has been heavily influenced by the decline of the Korean Won, as international tourists find the products in Korea to be inexpensive. In the past, tourists would go to duty-free shops, but now, tourists are going to department stores, as they provide discounts, temporary memberships, and translation services to foreign customers. Seoul retailers are aiming to improve the shopping experience by offering promotions and memberships to foreign tourists.

Lotte Department Store’s success in offering tourists a discount and transit-enabled membership card has been an immense success, as over 25,000 cards were issued within the first two months of operation. The department store also has approximately 400 instant tax refund kiosks to help foreign tourists receive tax refunds.

Ways to Gain Foreign Customers

To further profit from the increasing number of foreign customers, Shinsegae has begun working with payment methods such as WeChat and Alipay to accommodate Chinese tourists. Hyundai Department Store, on the other hand, is trying to improve her services to foreign travelers who have short layovers. The Hyundai Seoul flagship store in Yeouido is the Hyundai Seoul flagship store, where foreign customers are estimated to have spent about 20% of the total sales in 2025, substantially better than the 3.3% reported in 2022 and 15% in 2024.

To improve the shopping experience in the department stores in Seoul, some retailers have also introduced a tourist transit program. The program allows tourists to shop and dine in the department stores during their short layover.

Promising Future for the Retail Market in South Korea

Industry experts say that the increase in spending by foreign tourists will still positively impact earnings for department stores in Seoul. This is because domestic consumption is showing signs of recovery as foreign tourists increase. The department store chains are expected to experience even more increases in 2026 and the years to come. Yanolja Research estimates that by 2026, the number of foreign tourists to Korea will exceed 20.36 million, especially from China, Japan, Taiwan, and the United States.

Rising East Asia geopolitical tensions, especially with China and Japan, may increase tourism for Korea, especially for Chinese tourists, which will positively impact Korea’s retail industry.

New Era for Luxury Retail in Seoul

Seoul’s department stores are expected to further prosper as they adapt to and meet the needs of their growing international clientele. The combination of ongoing international interest in Korean culture and the prioritization of foreign tourist experience in Seoul’s retail sector provides strategic opportunities to enhance Seoul’s standing as a premier global retail destination and ensures sustained momentum to Seoul’s retail sector.

Seoul’s department stores will continue to be a big part of South Korea’s growing economy and will be able to offer foreign customers the best of the best because they will keep investing in shopping amenities, luxury offers, and exclusive memberships.

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