In a surprising development, South Korea’s convenience stores are embracing an unexpected addition to their offerings, alongside the familiar staples of ramen noodles and sausages: gold bars. Partnering with the Korea Minting and Security Printing Corporation (KOMSCO), CU, the country’s leading convenience store chain, has introduced miniature gold bars to its lineup, and the response has been nothing short of remarkable.
Since their debut in April, CU outlets have been showcasing a diverse range of finger-nail sized gold bars, varying in weight from 0.1 gram to 1.87 grams. With prices corresponding to their weights, these gold bars cater to different preferences and budgets, with a 1.87 gram bar commanding 225,000 won ($165.76), while a 0.5 gram bar is priced at 77,000 won. Strikingly, the 1 gram bars, priced at 113,000 won each, flew off the shelves within a mere two days of their release, a testament to their popularity among consumers.
Adding to their allure, these gold bars come adorned with an array of designs, from congratulatory messages to birthday wishes, and even personalized motifs tailored to different personality types. This unique blend of investment and sentimentality has struck a chord with shoppers, contributing to the rapid uptake of these novel items.
Data from CU’s commerce phone app Pocket CU sheds light on the demographics driving this trend, with individuals in their 30s emerging as the most active purchasers, comprising over 41% of total sales since the launch. Not far behind are those in their 40s, representing 35.2% of sales, followed by individuals in their 50s at 15.6%. Even the younger demographic, aged in their 20s, has shown interest, contributing 6.8% to overall sales figures.
The surge in demand for gold bars mirrors a broader trend observed by the World Gold Council (WGC). According to the WGC’s recent report, gold purchases in South Korea witnessed a remarkable 27% year-on-year increase in the first quarter of this year, totaling 5 tons. This surge, the sharpest quarterly rise in gold acquisitions in the country in over two years, is attributed to the escalating prices of the precious metal.
Capitalizing on this growing appetite for gold, other convenience store chains in South Korea, such as GS25, have also joined the fray. GS25, for instance, offers customers the convenience of purchasing small gold wafers from vending machines, further democratizing access to this coveted investment asset.
The surge in gold purchases can be attributed to various factors, including economic uncertainty and currency depreciation. As noted by Heng Koon How, head of markets strategy at UOB, gold emerges as a preferred safe-haven asset amidst inflationary pressures and financial instability, offering investors a hedge against market volatility.
This trend is not limited to South Korea; it extends across Asia, with younger demographics showing a growing interest in gold investment. In China, for instance, the collecting of 1 gram small beans in glass jars has become a popular trend among the youth. China’s ascent as the world’s largest buyer of gold jewelry further underscores the region’s burgeoning appetite for the precious metal.
Even in the United States, gold continues to captivate investors, as evidenced by the popularity of one ounce gold bars at retail giant Costco. As economic uncertainties persist and inflationary concerns mount, gold retains its allure as a timeless investment option, attracting a diverse range of investors seeking stability and asset diversification in an uncertain world.