A Korean Story

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\"Paco-KoreanStory\"Why should any of us in the world of retail pay any attention to the 38th parallel that divides the Korean Peninsula? In an unforgiving world where political and economic crisis have propagated the largest movement of refugees in human history — from Beirut to Paris, from Mali to the Sinai — the assault on innocence has become part of our daily diet of information. We can hide at the end of our suburban driveways and proclaim our solidarity with muted colors on our faces, posted on social media, or we can face the immediate Stars Wars reality that haunts the shrinking planet we inhabit.

While brush fires burn all over the world, the tinderbox of modern consumer culture sits in Northern Asia where ocean currents and prevailing winds promise us the most immediate visual and physical consequences to ecological accidents or limited nuclear exchanges. The 38th parallel is the most peaceful and dangerous place in the world.

Border Patrol

The Korean border provides one of the startling contrasts in modern economic history. To the north is one of the poorest and most isolated countries on earth. Its people have physically shrunk over the past 60 years as malnourishment and famine have visited repeatedly. It is mountainous, cold and deforested, as generations have scraped the environment for combustible fuel. What retail exists is the rare hot house, artificially created and sustained for the country’s elite.

The border is militarized. Mines, tank traps, and pillboxes are augmented by soldiers on both sides. The only positive about the border is a de facto ecological reserve where plants, trees and small animals have had 60 years of peace to prosper. North Korea has a young mad leader and a nuclear arsenal that is primitive and yet functional enough all supported by a large standing army. Within the sight lines of the heavy artillery batteries of the North Korean Army is the world’s most modern city.

Emerald City

South Korea, by contrast, is a global success story. It is hard to imagine that this agricultural nation with the same GDP as Egypt in 1960 would have gone through the transformation it has in a little over 50 years. When I lived in Seoul as an exchange student in the winter of 1972, the city was heated with small stoves burning coal/clay briquettes. The city had, with Ankara, Turkey, the worst air pollution a 20th century city has ever known. With a military midnight curfew, the city went crazy at 11:00 P.M. as everyone raced to make it home before the city shut down. More than once I was physically sick on the streets sucking in bad air running to get home before midnight.

Today almost nothing of that city exists today. The air pollution of 1972 is long gone as is even the memory of the briquettes. The subway system is extensive. Lotte World Mall, the newest of countless elegant world class shopping venues, sits at the base of a 100-story tower. More than half of all Koreans live the Seoul Metro area. That concentration makes Seoul one of the most homogenous of modern cities. Smart phone penetration and urban cyber speed access is the highest in the world. In almost every way in which we calculate progress, South Korea is remarkable—from average income to low infant mortality.

Seoul is home to all South Korean enterprise. Samsung is the world’s largest manufacturer of consumer electronics having left Sony in the dust more than 10 years ago. Korean car manufacturers who were laughed at 20 years ago are producing high quality products at a very fair price, and they sell well everywhere. In this Confucian culture there has always been a high priority placed on education. Being a student has status, and students have been viewed as the conscience of the nation. A family will sacrifice everything to send their kids to the best university they can afford. Korean universities turn out good engineers and good marketers. In a nation with no natural resources, its stock in trade has been intellectual capital and a capacity for hard work.

I don’t know a major American firm that doesn\’t have tough stories about working for Korean clients. I know I do.

Export Culture

Beyond engineering, South Korean marketers have two powerful forms of Ka-mer-chal Kulcha that are sweeping across the developing world. Both forms may have been invented in the west, but the Koreans have put both of them to work in the cause of their consumer product manufacturers. The first is K-Pop. Think N*Sync, One Direction on steroids. In 2015, K-Pop is estimated to have $4 billion in sales. K-pop is boy bands and girl bands all packaged like candy bars. It is sound, dance, and light show. What is evident to the western eye is the sexual ambiguity of it all. Borrowing from Japanese Manga, the cutie-pie sexuality is confusing. It isn’t the twerking of Miley, or the cleavage of Beyoncé, or the defiance of Meghan Trainor or the six packs of One Direction; it is about a synthesized vision of chaste perfection. We got Gangnam Style on YouTube. PSY somehow leaked through. We watched it all, loved it and yet somehow didn’t put it in context. What would have happened 50 years ago if Coca Cola and Levi Strauss had owned the Beatles?

K-Pop has a slightly older sibling, which is the South Korean Telenovella, or soap opera that has seeped across Asia. Unlike Sex and the City or The Kardashians, these are contemporary Confucian morality plays that dramatize romance and virtue, and are less challenging to the conservative social norms of modern Asia. No sex, and the kissing doesn’t start until the couple has known each other for at least 10 episodes, or so the legend goes. What each soap opera shares are very pretty women with highly developed shopping habits. The telenovellas translate well and can be easily dubbed. The actors are clearly Asian and are easy to identify with. The plays are broadcast, downloaded and circulated on CDs at the corner convenience store. What is scary is that while the consumer connection in Sex in the City seems accidental (or accidently on purpose) there is no ambiguity in the Korean product. They are movies where product placement is not the icing on the cake, but the entire party. Thus, like Sara Jessica’s Carrie, the Korean stars are used as brand icons. “The look” is being used by Korean fashion and cosmetic brands and they are giving the Western luxury brands a run for their money. Chanel, L’Oréal, Revlon have Amore Pacific and Innisfree up on their radar screens.


What has been the accelerant to K-Pop and Telenovella development is a powerful link to social media and YouTube. In a Korea, so many young people commute to and from work for an average of two hours a day on public transportation. For those hours, their heads are buried in their smart screens. What are they watching? Not reruns of Friends, or Gilt.com. The dipsticks of the future of modern shopping are all out there, we just have to recognize them and pay attention.

Combine engineering and digital marketing and you have a critical epicenter to the development of the 22nd century. Samsung and LG are both deeply committed to the development of both our digital home and dominant role the modern smartphone is going to have in our lives.

The future of cars, cosmetics and the robot technology that will drive modern apparel manufacturing are anchored a short distance away from that demilitarized zone. A tragedy in Paris touches us all; the effect of a tragedy in Seoul is even more unthinkable and profound.

Yet, ask any Asian political analyst and the overwhelming consensus is that tragedy on the 38th parallel is inevitable, the only question is scale.



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