Diary Entry for 8-12-08

So I work[ed] at a tea store called Lupicia. One fact that always stuck with me about the franchise was that they had one store in South Korea. Just one. I just had to see it at least once when I was in Korea. Despite the fact that I hadn't gone to a Lupicia only since early July (when I sort of just stopped going due to lack of hours), I kind of forgot how the Lupicia stores look and feel and I also forgot how incredibly small my own store was until I went into the Lupicia store in Apgujeong.














While a lot of people almost instinctively hate franchises, I love the fact that stores rarely deviate from the main layout set by a corporate identity, only changing to accommodate physical and financial restrictions.















The Korean store carried a very wide selection of both teas and tea accessories/paraphernalia, had a little bar, could serve iced tea, and had zero customers. These were all things I richly desired everyday that I worked in my own Lupicia. Especially the bit about having zero customers.































They carried a lot of stuff that was discontinued at the states or pretty much trashed due to the inability to sell to Americans AT ALL. Gong-fu Tea sets were sold at 199,000원, which is about $200. I laughed when I saw this, because the US side couldn't sell any of these AT ALL and there was so much overstock that we gave them away as gifts to customers. I have two entire sets at home for myself.






























The power of tariffs and social perception became doubly apparent to me when I saw the price tags. Chinese and Japanese teas were being marketed at prices almost triple that of the US. Jasmin Mandarin, sold in the US at $4 for 50g, was sold here at 14,000원, approximately $13. Tsugaru Green, a green tea blend, sold in the US for about $5, was sold at 15,500원, or a little over $14. Two factors play into this. One, the Korean market is protective of it's domestic tea market which does not get sold widely outside of Korea. To prevent foreign tea blends, especially white and green teas from pushing Korean tea into extinction, high tariffs are implemented on Asiatic teas. This allows Korean tea farms to remain competitive at least in their own country.

The second factor is social perception. Koreans are stupid. Not going to beat around the bush here about this fact. The entire society has a perception of quality based on pricing rather than what should be, which is a pricing mechanism based on quality. In layman's terms, the more expensive something is, the better it is. It really doesn't matter if it is actually better or not. Koreans are willing more for goods purely on the increase in price of that good. A $4 tea, even if it is exactly the same as $14 tea, is seen as inferior, and the $14 tea is bought more often, purely for that extra $10 price tag. Accordingly, having a higher price tag not only increases marginal profit but volume as well. Logic does not apply very well here, but when has logic ever been applicable to Koreans?

Anyways, I had a good laugh and I left and I went home and I drank tea that I brought from the states, the exact same teas I saw in that store but I bought for nothing.