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We visited the most popular Costco in South Korea, and saw how the company has won over shoppers with free samples, fresh octopus, and bulgogi bakes

Feb 3, 2020, 21:15 IST
  • Costco's business in South Korea is booming, where the warehouse giant has 16 locations.
  • Business Insider recently visited the most popular Costco store in South Korea.
  • We discovered that the core of Costco remains the same, but the retailer has won over local shoppers with options you can't find in the US - like fresh whole octopus and bulgogi bakes.
  • Visit Business Insider's homepage for more stories.

SEOUL, South Korea - Costco is one of the most beloved stores in the US. And, it also has a cult following in South Korea as well.

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Costco has 16 locations in South Korea, making it the sixth largest Costco market in the world. And, the discount giant has developed an especially dedicated fanbase in Seoul, Costco Korea regional marketing manager Sunmi Goo told Business Insider.

According to Goo, the warehouse in the Yangjae neighborhood is the most popular in the country, likely in part due to its location in the affluent Gangnam district. Shoppers swarm to the location. Goo said that recently, during the busy shopping period around Christmas and the Korean New Year, customers were so desperate to get their Costco shopping done that some customers waited up to an hour to enter the massive parking garage and get into the warehouse.

I recently visited the Yangjae warehouse and found a few surprising differences from Costco in the US.

Here is what it is like to visit Costco in South Korea - and why it should come as no surprise the retailer is building a massive fanbase around the world.

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Nine of the Costco locations in South Korea are in Seoul or the surrounding area.

With a massive parking garage and a minimalist warehouse look, the Yangjae location feels pretty similar to an American Costco from the outside.

Inside, I'm greeted with another familiar — and welcome — sight: free samples!

Like in the US, you need a Costco card to shop at the warehouse. I left my card at home, but luckily got special permission from Costco to take pictures at the warehouse.

Almost as soon as I walk in, some luxe merchandise catches my eye. This diamond necklace costs 8.5 million won, or more than $7,100.

Read more: 15 surprisingly expensive things you can buy at Costco

Shoppers can buy various luxury brands at the Yangjae Costco, like this $3,800 handbag.

Venturing deeper into the warehouse, I was surrounded by shelves of products, stacked to the high ceiling — a classic Costco set up.

From fashion to food, American brands made a strong showing.

In some sections, I could pretend like I was back in the US.

However, a closer look revealed a few new best-sellers. Krill oil, for example, is a massive product at the South Korean Costco, with shoppers pulling packages off the shelf in bulk.

Surgical masks were quickly selling out the day I visited, due to fears of the Wuhan coronavirus spreading in South Korea.

Bottled water is always a top item, according to Goo.

Kirkland's water brand, which is bottled in South Korea, needs to be restocked three times a day and up to five times a day on the weekend.

Kirkland has become beloved brand in Korea as Costco's reputation has spread, Woo said. Because Costco spends essentially no money on marketing, it relies on word-of-mouth to win over South Korean shoppers.

Read more: Costco has a brilliant strategy that allows it to get great press, save money, and pay workers $15 per hour

Giant stuffed animals are still a Costco staple.

Shoppers can peruse various Apple products.

Or, they can take a break in a massage chair.

Some of the top-selling categories at Costco in South Korea are beauty, pharmacy, and health, especially as shoppers make nutritious New Years resolutions.

Fresh food takes up the entire basement of the Yangjae warehouse. Descending downstairs, I quickly realized just how much American Costcos are missing.

There were some familiar sights. The rotisserie chicken remains...

... and still only costs about $5.

It is joined in the hot deli section by options such as pork.

Sales of ready-to-eat food have been growing in South Korea in recent years. Costco has been cashing in with more prepared options, like this bibimbap.

Source: Euromonitor

Shoppers have everything they need to make nak-gop-sae in this package, which includes an aluminum pot along with tripe, seafood, and other ingredients.

Journeying deeper into the groceries, I noticed the seafood selection is especially impressive compared to the US.

You can buy a full, raw octopus.

Or, fresh sea cucumbers.

Look at these lovely abalone, or sea snails, ready for shucking.

Of course, Costco has plenty of meat beyond seafood.

Sales of fresh food at this warehouse increased 14% in the last year, according to Goo.

Alcohol sales are also swiftly growing.

And, this isn't just some Two Buck Chuck.

This Cabernet Sauvignon costs 399,900 won, or more than $330.

Then again, it wouldn't be Costco without some bulk options. This massive soju is used for preserving food, not drinking.

You should probably stick to the Heineken mini keg if you're trying to get drunk.

The free sample spree continues in the basement with some tasty beef jerky.

Kirkland brands also keep popping up, including roasted seaweed that is produced in South Korea.

This candy mix was a hot item as shoppers rushed to Costco to get gifts leading up to the Lunar New Year.

Costco had to limit how many a single person could purchase.

There is a massive stock of Spam.

Oreos also had a nice showing. (I almost didn't notice the label had been translated into Korean.)

Costco's bakery is always going to be a treat...

... As is the food court. However, Costco had a few different items in the Korean food court that you can't find in the US.

Classics like the hot dog and pizza remain on the menu.

But, in South Korea you can also order a pork cutlet, bulgogi bake, abalone porridge, and blueberry yogurt smoothie.

I tried the bulgogi bake, the porridge, and the smoothie. And, I was blown away by how good everything was.

The bulgogi bake in particular was Costco magic, a cheesy, comforting counterpart to the classic chicken bake. The crisp cheese, the stretchy dough, the rich bulgogi beef — I was obsessed.

I spotted some shoppers making "Costco kimchi," mixing onion, mustard, and ketchup.

Read more: South Korean shoppers are obsessed with a dish called 'Costco kimchi' — here's how to order it in the US

It was a food court meal just as good — or better — than any I'd had at a Costco in the US. Frankly, I'll be dreaming of that bulgogi bake for years.

Costco is successful in South Korea for the same reason it has a rabid fanbase in the US — good deals, a massive selection, and a willingness to tweak its offerings to fit local preferences.

Ramsey Monroe, who has visited 226 Costco warehouses in five countries, recently told Business Insider that one of her favorite things about visiting Costcos around the world is finding out what products are unique to that region.

Read more: A woman who has visited more than 200 Costco stores around the world reveals the most interesting warehouses she's seen — and the 2 things they all have in common

Visiting Costco in South Korea, I have to agree with Monroe. It was amazing to see how the classic Costco model won over local shoppers with just a few adjustments and adding things like sea snails and bulgogi bakes to its selection. As Costco slowly and steadily continues to grow around the world, locations like the Yangjae warehouse prove why Costco is thriving in 2020.

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