1. Korean Consumer Trends:
2010 and 2020
Earned Income
Income from Business Operations and Side Work
Property Income
Transfer Income
116 | www.seriquarterly.com
Lee Dong-Hun
The first decade of the new millennium was
chaotic as the 20th century paradigm trans-formed
into that of the 21st century. While a
new era of digital technology and participato-ry
and communicative culture was ushered in,
remnants such as celebrity suicides, a global fi-nancial
crisis, and a worldwide epidemic carried
over into the new age.
During the next decade, the 21st century para-digm
is expected to unfold in earnest. In partic-ular,
with a new political system and improved
relations with North Korea, South Koreans
will focus more on health and quality of life
rather than on political issues, as in advanced
countries. Driven by new growth industries in
the service sector as well as “convergence” and
“emotional” technologies, per capita income
will reach $30,000, and Korean society will turn
into an individual-oriented aging society with
low birthrates and greater diversity. On the dip-lomatic
front, Korea will become a strategic key
Departments
|Table 1 Income and Spending of Average Income Bracket
Note: 1. Figures for 2020 are estimates by Samsung Economic Research Institute.
2. Figures in parentheses depict a percentage of total consumption.
Source: Statistics Korea, KOSIS.
(Weighted %)
2020
Income
Ordinary Income
Non-ordinary Income
Non-consumption Expenses
Disposable Income
Food Expenses
Dining Out Expenses
Housing Expenses
Utility (light, heat & water) Expenses
Furniture and Household Goods Expenses
Home Maintenance Expenses
Clothing and Shoes Expenses
Health and Medical Expenses
Educational Expenses
Culture and Entertainment Expenses
Transportation and Communication Expenses
Other Expenses
1995 2008
191.1 389.5 780.4
164.3 338.5 667.7
6.3 10.8 221.3
4.3 4.5 5.5
5.0 16.5 49.5
11.3 19.2 35.6
17.9 54.2 160.4
173.3 335.3 620.0
35.7(25.3) 63.5(20.9) 105.5(18.5)
11.9(8.4) 31.1(10.2) 55.7(9.8)
4.6(3.3) 8.1(2.7) 15.6(2.7)
5.0(3.5) 11.4(3.8) 22.2(3.9)
5.8(4.1) 11.0(3.6) 19.3(3.4)
0.9(0.6) 4.7(1.5) 10.1(1.8)
9.5(6.8) 13.1(4.3) 21.6(3.8)
5.6(4.0) 11.9(3.9) 23.0(4.0)
11.5(8.2) 32.5(10.7) 73.0(12.8)
6.5(4.6) 11.9(3.9) 26.0(4.6)
14.5(10.3) 43.3(14.2) 121.0(21.2)
24.4(17.3) 42.6(14.0) 56.6(9.9)

2. Lee Dong-Hun
January 2010 | SERI Quarterly | 117
point, serving as a hub of free trade agreements
and chairing a G20 summit. Korea’s economic
development will also be driven by the newly-adopted
green industry, just as the IT industry
led previous growth.
This paper provides a review of the present
(2010) and outlook of the future (2020) on Ko-rea’s
consumption patterns.
Clothing and Fashion
With the proliferation of placing priority on
physical appearance by the general public, in-creased
spending on cosmetics and beauty has
become the norm, regardless of gender or age.
Whether getting married, starting school, find-ing
a job, being promoted at work, and at oth-er
important moments in life, how one looks is
now a critical factor to success. While the fash-ion
market used to be dominated by products
and services for women in the past, the market
for men is rapidly growing. In addition, going
beyond makeup, it is now becoming general-ly
accepted to seek more proactive methods or
even plastic surgery to look better.
As for spending on clothing in 2020, the fash-ion
market will have more categories with a
wider range of selections between top premium
brands and bottom-priced brands due to the
fashion needs becoming more diverse. In addi-tion
to clothes, fashion items will have more va-riety
in accessories, such as glasses, shoes, bags,
watches, and scarves. While luxury goods enjoy
less rarity value, “masstige brands”1 will lead to
the popularization of luxury goods. As a result,
instead of luxury brands that everybody knows
about, the brands that are known to “only
those who know” or experimental “beta luxury
goods” will attract more attention. Thus, it will
be easy to notice luxury-goods-hunters who
seek new luxury brands. In particular, as male
consumerism gains in market stature, prod-ucts
for men will be nearly as diverse as wom-en’s
products. As can be seen on some popular
UCC websites run by ordinary men who creat-ed
their own content on male fashion, by 2020
the number of trendsetters will increase not
only among celebrities but also among the gen-eral
male population.
Foods
The current eating trend needs to satisfy de-mands
for convenience and well-being, as well
as taste and nutrition. Convenience-oriented
western-style eating habits, such as takeout and
Local Foods
Fairly Traded Foods
1 Masstige is a marketing term derived from the words mass + prestige, to mean downward brand extension or “prestige to the masses.”
See: Michael J. Silverstein and Neil Fiske, “Luxury for the Masses,” Harvard Business Review, April 2003, Vol. 81, Iss. 4, pp. 48–57.

3. Korean Consumer Trends: 2010 and 2020
brunch, are spreading rapidly in Korea, and
consumers are making health-based decisions
when purchasing snacks, drinks, and even al-coholic
beverages. With food safety becoming a
major issue during the past couple of years, it
is clear that an increasing number of consumers
demand healthier food.
By 2020, the food consumption trend is ex-pected
to move toward an active appreciation
of value along with conditions and taste. That
is, more consumers will not only check for the
place of origin and ingredients list, they will
pay greater attention to issues regarding the
mistreatment of animals, resource waste, and
others before buying food products, virtual-ly
standardizing the “LOAF” (Local, Organic,
Animal-friendly, Fair-traded) principle. There
will also be a rising number of consumers who
want to relish the natural taste of food with less
artificial elements like excessive seasoning.
A desire to better both eating at home and din-ing
out will result in a new type of culinary hab-its.
For example, “entertainment cooking” (pro-viding
the fun of cooking), premium instant
foods, and other phenomena that are now prev-alent
in advanced countries will spread in Ko-rea.
Also, as dietary supplements and various
types of desserts gain higher levels of quality
and diversity, they will very likely become con-venient
alternatives for regular meals. The cur-rent
trend of stronger preference for functional
healthful food will be further strengthened, and
local foods that offer unique flavors also will
continue to attract more interest.
Housing and Interior Design
Houses today are no longer just a place to
live and a means to accumulate equity wealth.
Housing-related consumption is directed to-ward
high-technology and premium quality due
118 | www.seriquarterly.com
to the demands in convenience and environ-mental
friendliness. To be regarded as premium,
a housing complex needs to have a good, conve-nient
environment for schools/private institutes,
cultural activities, and shopping, as well as nice
landscaping and high environmental value. Ac-cordingly,
there is a rise in remodeling and up-grading
of interior facilities.
As for the housing trend in 2020, the boundary
between private and public space will be less
clear, as a residence serves not only as a place
for a family to sleep and rest but also as space
for leisure, social activities, and personal ex-pression.
Interior design will increasingly reflect
personal tastes just like fashion styles, and new
housing and interior designs focusing on conve-nience
will continue to advance. And a house or
separate space will be created for small commu-nity
meetings in the neighborhood.
Among wealthy retirees of the baby boom gen-
Yachting on the Han River
Home 3D TV

4. Lee Dong-Hun
January 2010 | SERI Quarterly | 119
eration in particular, owning a second house
for weekend relaxation and vacation will be-come
more popular. Those in the middle-class
will also make frequent use of downtown ho-tels
and lodges and bed-and-breakfasts in the
suburbs. With environment-friendly value hav-ing
much more importance in deciding pur-chases,
energy saving and other various cut-ting-
edge technology will meet the needs of
security and safety.
In addition, a U (ubiquitous) cityscape will
be created to meet the consumption needs of
pleasantness, convenience, safety, and health.
Futuristic high-tech cities, where IT infrastruc-ture,
technology, and services are applied to
housing, transportation, facilities, and oth-er
various components of a city, will spread
throughout Korea. Regarding this, there will be
an increase in large projects developing new cit-ies
and redeveloping old cities.
Leisure and Entertainment
Compared to the past, when people’s lives re-volved
around work and social meetings, an
increasing number of people now put greater
emphasis on leisure and entertainment. Thus,
consumption related to this change is rapidly
rising. For example, instead of the typical travel
to landmarks, it is getting more popular to seek
first-hand experience by going to festivals, tem-ples,
tea ceremonies, and touring by foot in re-gions
filled with local interests. Activities once
regarded as professional sports by some, such
as mountain biking, inline skating, and water
skiing, are fast becoming leisure activities. The
Internet is not just a means to search for infor-mation
anymore as it has become a crucial fac-tor
in leisure and entertainment where non-pro-fessionals
are able to create and share their own
content online.
By 2020, these trends will be seen more fre-quently,
and experiential leisure will become
more important. Besides traveling to remote
places for leisure activities, it will be easy to take
quick trips to enjoy nature-friendly environ-ments,
culture and art, and leisure infrastructure
in downtown areas. Municipal governments
will also improve parks and living infrastruc-ture
as their major projects. For instance, the
Seoul city government’s Han River Renaissance
project will enable citizens to enjoy yachting in
the middle of the city, not just on the southern
coast, and expansion of concert halls and facili-ties
on Seoul’s Nodeul Island will provide easy
access to leisure activities.
Also, as Internet protocol television (IPTV) be-comes
popular, watching TV will become an in-
The Internet is not just
a means to search for
information anymore as
it has become a crucial
factor in leisure and
entertainment where non-professionals
are able to
create and share their own
content online.

5. Korean Consumer Trends: 2010 and 2020
teractive watching experience based on partici-patory
content and devices enabling realistic
experiences. With 3D/4D TVs coming into wid-er
use at home, the desire to feel realistic will go
beyond the audio and visual senses to include
taste, smell, and touch.
Health and Medical Services
Present-day hospitals are not only places to heal
the sick but they are places where people can
check the status of their health. Consequently,
health and medical services are increasingly fo-cusing
more on prevention than treatment. Dis-eases
typically seen among middle-aged people
are now showing up regularly among young-er
adults, making the need for comprehensive
checkups more widespread, regardless of gen-der
and age. As an older population becomes
concerned about healthy life as much as the
length of life, osteoporosis test and chitosan
products are gaining much popularity.
By 2020, the health and medical sector will in-clude
mental health to become more of a com-prehensive
health management. In addition to
hospital visits, self-check on health will be more
general. There will be those who consult doc-tors
on a videophone and make diagnosis one-self
utilizing their own medical equipment at
home: do-it-yourself (DIY) doctors.
120 | www.seriquarterly.com
Consumption related to biotechnology is also
expected to rise gradually as people hold less
reluctance to innovative medical technologies
such as stem cell research and genetic engineer-ing.
Genetic engineering will first be adopted
in areas where people feel relatively less reluc-tant
about genetic engineering, such as beauty
treatment.
Education
One noticeable change in education is that pri-vate
education institutions increasingly wield
stronger influence than public schools. Various
private education platforms attract popularity
as parents distrust public education that is inca-pable
of providing customized service. Private
education for office workers is also rapidly ad-vancing
since self-improvement is regarded as a
vital way to survive and succeed in the business
world. Even high-ranking public officials and
CEOs take private courses on wine, jazz, and
various arts for fear of being considered an out-of-
step leader.
By 2020, the educational spectrum will be
broader, encompassing those who desire high-er
quality of life. Education methods will also
change from traditional lectures and note-tak-ing
to student-oriented activities and diversified
modes of learning. New media, such as the e-book
reader Amazon Kindle and the electronic
whiteboard connected to an e-book device, will
soon be appearing in classrooms and enabling
customized classes for students.
With the average life span getting longer, con-tinuing
education will not just mean a pastime
for elderly people. Instead, educational facili-ties
for senior citizens will see growing usage
and enthusiastic participation but cost as much
as current private education fees for younger
students.
Medical Equipment for Home

6. Lee Dong-Hun
summed up as intellectualization and emo-tion
sensitivity. As automobiles and roads be-come
more intelligent, automobiles will be con-sidered
more as a comfortable ride instead of
a vehicle to drive. All physically disadvantaged
and elderly drivers will find it much easier to
drive a car, thanks to intelligent features such
as parking and navigation systems, with artifi-cial
intelligence and automatic braking. As for
communications, in addition to efficient human-to-
human communications, human-to-machine
communications will be a hot topic among con-sumers.
In order to meet the emotional needs
of lonely consumers, pet dog voice interpreters
equipped with a sensor to catch the five senses
and emotion sensing technology is likely to be
commercialized. People will be able to get emo-tional
comfort from gadgets more advanced
than huggable dolls, which are being developed
by the MIT Media Lab, or Primopuel, an inter-active
doll made by Japan’s Bandai.
Translation: KIM Young-Kyu
Keywords
2020, intellectualizion, emotion sensitivity,
continuing education, beta luxury goods, LOAF,
local food, consumer trends, “masstige brands”
LEE Dong-Hun is a research fellow at SERI. His current re-search
focuses on marketing strategy and consumer trends.
He holds a PhD in Business Administration from Sogang Uni-versity.
Contact: seridhl@seri.org.
January 2010 | SERI Quarterly | 121
Takara Tomy’s Pet Dog Voice Interpreter
Bandai’s Primopuel
Transportation and
Communication
Transportation and communication is one of
the areas that have recently seen remarkable
achievement. Along with rapid upgrades in in-frastructure
and revolutionary improvements
in convenience, consumers demand much high-er
levels of transportation and communica-tion
services. High-speed Internet connection is
now a necessity for every home and, thanks to
3G mobile telecommunications services, a few
clicks are all that is needed to begin an unlimit-ed
information search. Also, public transporta-tion
infrastructure is advancing to a higher lev-el,
expanding traffic options for consumers and
creating various new demands. A few examples
of improved infrastructure include exclusive
bus lanes, high-speed railways, an integrated
public transportation system, and additional
subway lines.
The most striking change in 2020 will be

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