Shopping spree on Black Friday

The latest issue of Wall Street Journal reported that one of the most challenging things in Korea these days is to eat “Honey butter chip” while watching the movie “Interstellar” at an IMAX theater. It was a part of an article to introduce how hot the movie is in Korea, but it left bitter taste since it shows Koreans’ lemming-like rushing syndrome. One of this lemming-like rushing that hit Korea in November is overseas direct shopping spree during the U.S. Black Friday period.

Black Friday is the next day of Thanksgiving Day, the last Thursday of November. The name came from the fact that massive sales during the period turn retailers’ account books black. Retailers sell products with huge discount and consumers buy products that they had in mind during this period at cheaper prices. The scene, where Americans are waiting in line with tents on the side in front of stores to get desired products ahead of others, was very unfamiliar to us. From some time ago, overseas direct shoppers in Korea also started getting excited by the heat of Black Friday sales.

It was last year when the overseas direct purchases, which had been limited to some fraction of Korean consumers, started increasing explosively. It is for sure that last year’s overseas direct purchase amount of 1.15 trillion won (approx. 1.05 billion U.S. dollars) will surpass 2 trillion won this year. Explosive growth in direct overseas purchases was driven by the border-less e-commerce environment, young generations who have no difficulties in reading and writing English, conglomerates that have set too high prices for domestic consumers and distribution companies that have made excessive profits. Especially, the import distribution companies that have enjoyed unreasonable margins in the middle of supply chain must be on alert.

However, there are side effects, too. There is a possibility for consumers to make wrong choices since they have to choose a product based on pictures. It takes long time to ship to Korea and products arrive after the right time for use. It is not easy to exchange or get a refund. Some complain that there is little price advantage compared to the discounted price in Korea, given expensive shipping charges and customs duty. In addition, consumers can buy unnecessary products or overspend money as it may feel like a loss or being left out of trend if not buying anything during Black Friday period. Many people are posting comments on the Internet, cynically saying, “Why did I stay up all night to buy this?” with a picture of the shipped product from overseas. Chance and risk come along when you go ahead of others.