Korean travel retailer Shilla Duty Free is on the verge of striking an agreement to open the world’s first Louis Vuitton airport store at Seoul Incheon International airport towards the end of next year. According to Shilla Duty Free executive vice-president Jason Cha, the deal is "on the verge of completion" with final discussions imminent.
Until now the French luxury brand has favoured the downtown travel-retail channel and established a presence in downtown duty-free stores ran by the likes of Shilla and Lotte Duty Free and LVMH subsidiary DFS. International Airport Corp (IIAC) has been trying to attract the brand to the airport for some time and believes it would be a welcome addition to its 700-strong brand portfolio and DFNIonline understands that LVMH representatives have visited the airport on at least once occasion.
An IIAC spokesperson confirmed the imminent agreement and told DFNIonline that the airport hopes to benefit from Louis Vuitton’s strong brand power. The spokesperson said: "The store will encourage air travellers to shop at the airport and Chinese travellers in particular. "
The spokesperson indicated that Incheon airport is the ideal location for the brand’s first foray into airport retail because of its passenger mix. "Our core customers are Japanese and Chinese making it an ideal strategic location for the brand. The success of Shilla Duty Free coupled with strong overall sales at the airport since its opening in 2001 were no doubt key factors being the brand’s decision to choose both airport and retailer.
If the agreement goes through it is likely to spark fiercer competition between Shilla and Lotte Duty Free according to the spokesperson. "The whole issue is extremely controversial and is likely to cause problems because Lotte is a key duty-free player at the airport and will no doubt be worried about losing customers to Shilla when Louis Vuitton becomes part of its licence."