An inexpensive clothing brand from South Korea may enter Russia
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The first mono-brand stores of the South Korean fashion retailer 8 Seconds, which positions itself as a competitor to the Japanese Uniqlo and managed by Samsung, are preparing to open in Russia. The conglomerate’s partner will be the Russian distributor LR Retail, which, according to market participants, is connected with the owners of large Moscow shopping centers Aviapark and Oceania, among whom are the children of billionaire Arkady Rotenberg. Russians are quite loyal to brands from South Korea, but their promotion on the Russian market will still require significant funds, experts warn.
As Kommersant discovered in SPARK, LR Retail has registered several domains associated with the South Korean fashion brand of clothing in the mid-price segment 8 seconds, which is being developed by Samsung. Registration may indicate the plans of LR Retail, which manages inni stores in Russia, where women’s clothing and accessories from designers from South Korea are presented, and a premium children’s clothing boutique from the same country, Wandu, to become a distributor of 8 seconds in Russia. Samsung C&T Corporation (which is involved in the development of the conglomerate’s fashion division) and LR Group, which includes LR Retail, did not respond to Kommersant’s request.
LR Retail, created in November 2022, is 75% owned by LR Group, where the founder is the closed mutual fund Northern Aegis – Target, 25% by Anna Safronova. General Director of LR Group Kirill Bezuglov also heads Vozrozhdenie All-Russian Exhibition Center LLC, which manages Moskvarium at VDNKh. In 2017, the media linked Moskvarium with the structures of Arkady Rotenberg, but his representative denied the connection.
On March 1, the businessman’s representative also denied to Kommersant his connection with LR Group and LR Retail. Kommersant’s sources in the real estate market nevertheless connect LR Retail with the owners of the Aviapark and Oceania shopping centers, among whom are Arkady Rotenberg’s daughter and son Lilia and Igor. It was in Aviapark that LR Retail opened the first inni store and Wandu boutique in 2023.
At the time of the launch of the first inni, LR Retail told Kommersant that the creator of the project was the commercial director of Moskvarium, Nicolas Schitt, a fan of Korean art and fashion. He decided to launch his own clothing chain, “having seen the growing interest of the Russian consumer in Korean content,” the company explained. The names of private investors who invested in the project were not disclosed there.
In the spring of 2023, at the Retail Tech forum, the founder of CRE + Retail Group, Natalia Kermedchieva, reported that Samsung plans to introduce two of its fashion brands to the Russian market, including 8 seconds, and the first stores should appear before 2025. Ms. Kermedchieva told Kommersant on February 29 that “there are no solid reasons to believe” that the first stores of brands managed by Samsung will open in the near future.
Experts interviewed by Kommersant say that 8 seconds is considered the South Korean analogue of the Japanese chain Uniqlo, which closed all its stores in the Russian Federation after the outbreak of the Russian-Ukrainian military conflict in February 2022. Of all the international brands that have left the Russian Federation, according to Fashion Consulting Group CEO Anna Lebsak-Kleymans, “Russians remember Uniqlo with regret” because of its combination of technology, versatility and low price. Now in this segment there is potential for the development of new brands, says Evgenia Prilutskaya, director of the infrastructure retail department at CORE.XP. In addition, according to Evgenia Khakberdieva, director of the retail real estate department at NF Group, Russians have high loyalty to South Korean brands due to their great interest in the culture of this country.
But despite this, significant investments will have to be made to promote 8 Seconds, since the Russian market is overcrowded with unknown new brands, Ms. Lebsak-Kleymans believes. According to Irina Tsarkova, director of the Nikoliers retail real estate department, in 2023, 27 new foreign brands entered Russia, while eight ceased operations.
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