Luxury Goods in South Korea

Luxury goods in 2025: The big picture

Luxury goods in South Korea achieved solid 6% retail current value growth in 2025, rebounding from a slight decline the previous year. This resurgence was driven by sustained consumer indulgence and the release of pent-up demand, supported by a steady increase in both inbound and domestic tourism. Luxury brands successfully harnessed the influence of local personalities and offered exclusive product ranges to maintain and enhance their appeal. Moreover, unique retail experiences, such as pop-up shops and concept stores that incorporated elements of South Korean culture, further captivated consumers.

2025 key trends

In 2025, luxury goods in South Korea was characterised by several key trends that significantly influenced consumer behaviour and industry dynamics. Sustainability remained a paramount concern, with luxury hotels, for instance, implementing eco-friendly practices such as energy-efficient operations and waste reduction programmes. Personal luxury goods brands also bolstered their circular economy initiatives, including product repair and recycling services, in response to growing environmental concerns among consumers. Leading luxury brands like Louis Vuitton and Hermès typically offer in-house repair services for their products in South Korea. Meanwhile, the integration of artificial intelligence further enhanced personalisation efforts, as brands utilised AI-powered chatbots and augmented reality tools to facilitate virtual try-ons and bespoke shopping experiences, thereby elevating customer engagement across both online and physical platforms.

Competitive landscape

Luxury goods in South Korea saw premium and luxury cars dominate the landscape in 2024, due to the category’s sales dominance and high level of concentration. Nevertheless, shifts in share and position indicate intensifying competition. For example, Bayerische Motoren Werke (BMW) surpassed Daimler (Mercedes-Benz) to claim the leading position in 2024. BMW's success in 2024 was partly attributed to its launches of special edition models exclusively online in South Korea. Notably, the 5 Series Sedan (G30) was released as a 520i model with the M Sport Package Pro as standard, featuring a black kidney grille, red brake callipers, darkened headlights, and a black rear spoiler, along with a Harman Kardon sound system and M Sport suspension, priced at KRW75 million. Moreover, in electric cars, BMW introduced the i7 Frieze Seoul Edition, a bespoke version of the electric i7 saloon, as a sponsor of the Frieze Seoul Art Fair in 2024. As it is also owner of the Rolls-Royce brand, Bayerische Motoren Werke is able to effectively leverage its dual offerings, with BMW focusing on sporty, technologically advanced models, and Rolls-Royce catering to the ultra-luxury segment, thereby ensuring comprehensive market coverage.

Retail developments

In 2025, luxury goods in South Korea remained heavily dependent on physical retail outlets, which continued to be the primary distribution channel. Despite the ongoing digitalisation of shopping, offline stores maintained their dominance. This preference was notably evident in categories such as luxury leather goods, luxury jewellery, and luxury timepieces, in which the tactile evaluation of products and the immediate satisfaction of owning high-quality items significantly influenced purchase decisions. Retailers in these categories concentrated on enhancing in-store experiences through personal shopping services, bespoke consultations, and exclusive loyalty programmes, thereby further strengthening the appeal of physical retail to HNWIs. The value share of physical retail reflected these efforts, accounting for 87% of sales in personal luxury in 2025, underscoring the continued importance of traditional retail channels.

What next for luxury goods?

Luxury goods in South Korea is anticipated to experience steady growth during the 2025-2030 forecast period, with a retail current value compound annual growth rate (CAGR) of 4% (2025 constant value CAGR of 2%). This expansion can be attributed to a combination of increasing consumer wealth and evolving market dynamics. According to Euromonitor International data, the number of affluent adults, HNWIs, and ultra-HNWIs in South Korea is expected to continue to rise, thereby fuelling demand for premium and exclusive luxury goods. As a result, the growing affluent consumer base is projected to sustain value growth across key product categories, including premium and luxury cars, experiential luxury, and luxury leather goods.