What: Record-breaking heatwave and monsoon rains drive 10-14% visitor increase across major Korean department stores, boosting sales through indoor leisure activities.

Why it is important: This weather-driven shift in shopping behavior demonstrates how department stores can leverage environmental challenges to reinforce their role as climate-controlled leisure destinations, aligning with broader retail transformation trends in Korea.

South Korean retailers are experiencing a significant boost in foot traffic and sales as extreme weather conditions drive consumers to seek indoor leisure activities. Major department stores reported substantial increases in visitor numbers from July 1-17 compared to the previous year, with Lotte seeing a 10% rise, while Shinsegae and Hyundai recorded 14% and 13% gains respectively. This surge in footfall has translated into impressive sales growth, with Hyundai Premium Outlet achieving a remarkable 21.2% increase. The trend has particularly benefited food and beverage operations, with revenues rising between 10% and 15.8% across major retailers. Seasonal categories have also flourished, with swimwear sales climbing 15% at Lotte, while Shinsegae reported a 33.7% spike in bedding sales. Retailers are capitalizing on this increased traffic through strategic initiatives, including Lotte's Summer Gourmet Week and Shinsegae's art exhibitions, transforming their spaces into comprehensive summer destinations that offer respite from unpredictable weather conditions.

IADS Notes: The surge in mall traffic during extreme weather conditions reflects a broader transformation in Korean retail strategy. As reported in May 2025, Lotte's 44.3% profit growth demonstrated the success of adapting to changing consumer behaviors, while Shinsegae's "House of Shinsegae" concept showed in February 2025 how experiential retail can drive significant revenue increases, achieving 149.9% growth in restaurant sales. The current "mallcation" trend aligns with major developments seen in April 2025, when both Lotte and Shinsegae announced ambitious renovations of their Myeong-dong flagships, emphasizing the shift towards entertainment-focused destinations. This strategic evolution builds on successful initiatives from December 2024, when Lotte's Jamsil branch surpassed 3 trillion won in annual sales through a comprehensive retail ecosystem approach. The retailers' current focus on seasonal promotions and government incentives demonstrates their agility in leveraging both weather patterns and policy support to drive foot traffic and sales growth.

‘Mallcation’: Heatwave and monsoon drive Korean shoppers indoors