for decades, Daiso has been known as "the nation's general store" and has dominated South Korea's ultra-low-cost retail market. But there are signs of cracks in its fortress. capitalizing on the "salty consumption" trend spawned by high prices and the recession, powerful domestic and foreign competitors are entering the Daiso race with sharp weapons of their own. beyond simple price competition, the "Game of Thrones" for consumers' wallets has begun in earnest, with characters, emotional design, and new shopping experiences.

an onslaught of foreign legions: redefining 'value for money'

challengers from overseas refuse to simply be the 'cheaper Daiso' - they're taking on the market by redefining the concept of 'value for money'.

mINISO: the Return of the 'Goods Shop' Armed with Character IP

mINISO, the Chinese version of Daiso, has made a spectacular comeback after suffering the pain of withdrawing from the Korean market. The core strategy of MINISO is character IP (intellectual property rights). the store has transformed itself into a 'character-based goods shop' rather than a simple household goods store by putting products from over 150 global IPs such as Disney, Marvel, and Sanrio in the forefront.

the Gangnam flagship store is decorated in an "amusement park concept" with giant character sculptures and photo zones, making shopping an "experience" and "play," which stimulates "digging consumption," or fandom consumption, where people buy because they like it, as opposed to Daiso's "buy because you need it" approach. in other words, we created a new front in the Daiso competition: emotion and fandom, not price.

yOYOSO: a guerrilla strategy that cuts from the fat

another Chinese household goods brand, YOYOSO, chose a very clever strategy: a "guerrilla strategy" by opening its first store in Gunsan, Jeollabuk-do, rather than in Seoul, where competition is fierce. The intention seems to be to avoid a war of attrition in the capital city, where rents and marketing costs are high, and to build brand awareness in niche markets.

yoyoso targets Gen MZ women with its own private label (PB) products with minimalist and emotional designs. it aims to change the regional game in the ultra-low-priced retail market by offering a 'cheap but pretty' alternative to consumers who were disappointed with the functionality of Daiso.

3PPY & Don Quixote: Bypassing Japan and navigating the market

japan is no slouch either, and Daiso's parent company formalized a bypass through its premium brand, 3PPY, when the "Daiso" trademark prevented it from entering the country directly. 3PPY is a "300 yen shop" concept, and while its prices are higher than Daiso's, it differentiates itself with enhanced design and quality, including pastel-colored interior items. it's a strategy that adds "psychological satisfaction" to the price-performance ratio.

meanwhile, **'Don Quixote'**, a must-travel in Japan, confirmed the potential of the Korean market with the explosive success of its pop-up store at The Hyundai Seoul. it created a huge buzz, attracting more than 1200 people on its opening day, proving the thirst of Korean consumers for unique shopping experiences that are complex and treasure hunt-like, or "retailtainment." The brand has even recently registered a trademark for an exclusive overseas brand, raising the possibility of a full-scale launch.

indigenous giants fight back: defend the home front

in response to the onslaught of overseas brands, domestic retail giants have also entered the daiso competition in earnest, embarking on a defensive strategy.

e-Mart's 'Okay Price': Going head-to-head with Daiso

e-Mart launched its own private label (PL) brand **'5K PRICE'**, which consists of all products priced at 5,000 won or less, in a de facto declaration of war against Daiso. It targeted Daiso's pricing policy by focusing on daily necessities and food, such as toothbrushes for 880 won and popcorn for 980 won.

this strategy was based on the strong purchasing power gained from the merger of E-Mart and E-Mart Everyday. the idea is to steal Daiso's customers with the convenience of 'one-stop shopping' by encouraging consumers to buy low-priced household items that they would naturally buy at Daiso while grocery shopping.

convenience store industry: a dense counterattack on the high street

GS25, CU, and other convenience stores are using 'ultra-proximity' as a weapon to counterattack. They are launching a large number of cost-effective PB products, such as ultra-low-priced cosmetics in the 3,000 won range and health supplements under 5,000 won, to encourage consumers to buy low-priced products in their neighborhoods without having to go to Daiso.

this is a strategy that targets Daiso's 'mass display of many products' model with 'ultra-proximity sales of small items'. this may be Daiso's toughest battle yet, as it's not one giant competitor, but tens of thousands of small stores competing for the convenience store ultra-low price.

a blessing for consumers, a challenge for markets

for consumers, the benefits of this increased competition for Daiso are wider choice and more affordable prices. we now have a wide range of low-cost household product brands to choose from, depending on our needs, tastes, and moods.

however, there are also concerns that excessive price competition can lead to a decline in quality in the long run, and that hemorrhaging competition from large companies can put pressure on smaller manufacturers and the retail ecosystem as a whole. Let's hope that this great battle for the throne of "the nation's general store" will be a positive one for both consumers and the market.

daiso Competition Frequently Asked Questions (FAQs)

Q. how is Miniso different from Daiso? A . Miniso is based on low prices, but the main difference is that it focuses on selling 'merchandise' utilizing famous character IPs such as Disney and Marvel. while Daiso is centered on daily necessities, Miniso is differentiated by its character fandom-targeted merchandise and experiential store layout.

Q. is E-Mart's Okay Price always cheaper than Daiso? A . While it is not possible to compare all products, E-Mart's Okay Price has a very competitive price point as it is directly targeted at Daiso. In particular, some processed foods and daily necessities may be cheaper than Daiso or have a higher cost-performance ratio by utilizing E-Mart's bulk purchasing capabilities.

Q. are Japan Daiso and Korea Daiso the same company? A . No. In the past, Japan Daiso held a partial stake in Korea's Asung Daiso, but in 2023, Asung Daiso acquired the entire stake and is now a fully independent Korean company, both legally and operationally. Therefore, Japan Daiso's "Three Pea" brand is entering Korea as a competitor.

Q. why is competition in the ultra-low-price retail market intensifying? A . The main reason is that high inflation and the economic recession have led to the spread of the "recessionary consumption trend," in which consumers are looking for inexpensive goods. As the demand for value-for-money goods has exploded, competition among domestic and foreign retailers to capture this market is intensifying.

conclusion: The era of Daiso' s dominance is over, and it's the beginning of the Spring and Autumn War, where consumer preferences and strategies will determine the winner.

what do you think of the Daiso competitive landscape we analyzed today? Which brand are you most looking forward to? feel free to share your thoughts in the comments! If you liked the content, don't forget to subscribe and like!