Tesco Homeplus Virtual Subway Store – 스마트 가상 스토어

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We are introducing this new series – Keeping up with the Koreans – where we will keep an eye on and share updates on upcoming lifestyle trends in Korea. In this series we will talk about – Tesco Homeplus Virtual Subway Store – 스마트 가상 스토어 (Smart Gasang Store) - installed at Seolleung Subway Station in Seoul.

The Problem
South Koreans have a busy lifestyle, where they spend majority of their time either at their workplace or commuting for work. So activities like your regular grocery shopping or super market shopping becomes a chore and very time consuming. Taking out time for these activities would mean giving less time to your family. So how can a busy mom optimize her time, where she can accommodate her routine grocery shopping with her daily work commute thus giving her more time to spend with her family.

The Solution
British giant Tesco came up with this innovative solution – HomePlus Virtual Store – where instead of people walking into a store, the store would come to the people. They created billboards on the Seolleung subway station in Seoul that feature a range of products that customers can then select and scan using QR codes with their smart phones, only to have the selected groceries delivered later to their doorstep. The displays are set up just like aisles in any grocery store, so while you’re waiting for the train, you can get that pesky chore out of the way.

Seven pillars and six platform screen doors have been plastered with images of life-size store shelves filled with goods such as milk, egg, pasta sauce, gochujang (korean chilli paste), tissues, digital camera, fresh fruits, juices and various other items with each carrying a small barcode.

Shoppers just need to download a related application on their smartphone and make purchases by scanning the QR code of the product with their phone and then making payments through their app. The product then gets delivered to their homes as soon as they are back from work.

The Outcome
From the time the virtual grocery store was launched – August 2011 – it has been a hit among more 10,287 customers, with Home Plus reporting a 130 percent increase in online sales. The results of the initiative are impressive also in terms of numbers: online sales for the last year increased by 130 percent, with the number of registered members rising by 76 percent. According to Homeplus, its mobile application and Web page have had more than 65,000 users since their launch in April and post an average of 30 million won ($28,000) in sales per week.

The Infrastructure Advantage

  • Homeplus explained it chose Seolleung station for its trial store because over 200,000 commuters use it every day.
  • South Korea has 15.4 million smartphone users, more than 30 percent of the population. A state telecommunication official has estimated this will rise to 70 to 80 percent within three to four years.
  • Most Seoul subway stations support wireless networks through which smartphone users can access the Internet for free.

The Challenges

  • People may have to spend around 5 – 10 minutes just to complete an order to buy five items. So are people willing to spend that much time in the middle of a busy subway station.
  • The pricing has to be good for the idea to catch on,
  • Currently, Homeplus has targeted Seollung station for this project, whereby it covers almost the entire station with product billboards. It might not be feasible to cover other major metro station in Seoul with just Homeplus product billboards in the long run.

The Agency
Cheil Worldwide, Seoul, Korea.
The campaign won Grand Prix in Media, and Gold Lions for Direct and Outdoor.

The Future
So will this model be sustainable in the long run? Or is it just a new fad that may fade in a few months? Or was this a strategy to acquire new customers for Homeplus over its competitor Emart? What do you think?

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