‘Apartmentary’ Interior Service Strategy
Fixed Pricing, Standard Quotations
Bringing Transparency to the Interior Market
Article at a Glance
These days, everyone wants to decorate their home according to their own taste, but customer satisfaction in the interior market remains very low because of opaque cost execution and construction processes that small firms have long maintained as common practice. Interior service startup Apartmentary succeeded in winning over consumers in their 30s and 40s, the core customer group in the interior market, by accurately identifying and resolving these customer inconveniences. Apartmentary was the first in the industry to introduce ‘fixed-price interior services’ and discloses every step of the process to customers in a predictable and transparent manner through its dedicated application. It also succeeded in securing highly regarded construction specialists as partners through its unconventional policy of settling construction costs every week. It is also rolling out various new initiatives unseen in the existing interior industry, including interest-free loans for interior renovation funds.
A Market Where Demand and Satisfaction Move in Opposite Directions
Wallpaper or paint, hardwood flooring or porcelain tile, removing moldings or applying decorative film…. Anyone who immediately understands what this ‘balance game’ refers to is likely either interested in home interiors or has already experienced renovation work. As suggested by the flood of new ‘home’ terms such as home vacation, home cafe and home training, demand for renovating and decorating homes increased sharply through the COVID-19 pandemic. According to a survey conducted last year by consumer data platform OpenSurvey of adults ages 20 to 59 nationwide, the share of respondents who said they “usually have strong interest in interior design” approached 60%.1 Korea Research Institute for Construction Policy estimated the size of South Korea’s residential interior market at 13.4 trillion KRW as of 2019 and projected that the residential interior industry will become even more active due to rising income, aging housing stock, changes in perceptions caused by COVID-19 and the growing share of apartment living.2
However, deciding to undertake interior renovation work that costs tens of millions of KRW and in some cases hundreds of millions of KRW is not easy. The financial burden is large, but there are also few professional firms that consumers can confidently trust. Lemon Market3 is a term referring to a market in which transactions take place under information asymmetry between buyers and sellers, leaving buyers unable to properly know the fair price or quality of a product or service. The interior market is a representative example of such a lemon market. Because there are no fixed prices for materials such as wallpaper or flooring, each firm quotes different prices, and customers often cannot accurately assess the construction process or workmanship quality. It is also common for unexpected additional costs to arise after construction begins or for compensation for defects to be inadequately provided.
The reality that customer satisfaction with interior design services is declining in inverse proportion to rising demand is also confirmed by statistics from the Korea Consumer Agency. According to the Korea Consumer Agency’s 2021 Consumer Market Evaluation Index, the housing repair and interior design service market was classified as an inadequate market. In 2021, the number of consumer damage relief applications related to interior design received by the Korea Consumer Agency reached 568, a 37.4% increase from the previous year (412). The main types of consumer damage were failure or delay in defect repairs (24.5%) and poor material quality, construction, or finishing (14.2%).
These days, everyone wants to decorate their home according to their own taste, but customer satisfaction in the interior market remains very low because of opaque cost execution and construction processes that small firms have long maintained as common practice. Interior service startup Apartmentary succeeded in winning over consumers in their 30s and 40s, the core customer group in the interior market, by accurately identifying and resolving these customer inconveniences. Apartmentary was the first in the industry to introduce ‘fixed-price interior services’ and discloses every step of the process to customers in a predictable and transparent manner through its dedicated application. It also succeeded in securing highly regarded construction specialists as partners through its unconventional policy of settling construction costs every week. It is also rolling out various new initiatives unseen in the existing interior industry, including interest-free loans for interior renovation funds.
A Market Where Demand and Satisfaction Move in Opposite Directions
Wallpaper or paint, hardwood flooring or porcelain tile, removing moldings or applying decorative film…. Anyone who immediately understands what this ‘balance game’ refers to is likely either interested in home interiors or has already experienced renovation work. As suggested by the flood of new ‘home’ terms such as home vacation, home cafe and home training, demand for renovating and decorating homes increased sharply through the COVID-19 pandemic. According to a survey conducted last year by consumer data platform OpenSurvey of adults ages 20 to 59 nationwide, the share of respondents who said they “usually have strong interest in interior design” approached 60%.1 Korea Research Institute for Construction Policy estimated the size of South Korea’s residential interior market at 13.4 trillion KRW as of 2019 and projected that the residential interior industry will become even more active due to rising income, aging housing stock, changes in perceptions caused by COVID-19 and the growing share of apartment living.2
닫기However, deciding to undertake interior renovation work that costs tens of millions of KRW and in some cases hundreds of millions of KRW is not easy. The financial burden is large, but there are also few professional firms that consumers can confidently trust. Lemon Market3 is a term referring to a market in which transactions take place under information asymmetry between buyers and sellers, leaving buyers unable to properly know the fair price or quality of a product or service. The interior market is a representative example of such a lemon market. Because there are no fixed prices for materials such as wallpaper or flooring, each firm quotes different prices, and customers often cannot accurately assess the construction process or workmanship quality. It is also common for unexpected additional costs to arise after construction begins or for compensation for defects to be inadequately provided.
The reality that customer satisfaction with interior design services is declining in inverse proportion to rising demand is also confirmed by statistics from the Korea Consumer Agency. According to the Korea Consumer Agency’s 2021 Consumer Market Evaluation Index, the housing repair and interior design service market was classified as an inadequate market. In 2021, the number of consumer damage relief applications related to interior design received by the Korea Consumer Agency reached 568, a 37.4% increase from the previous year (412). The main types of consumer damage were failure or delay in defect repairs (24.5%) and poor material quality, construction, or finishing (14.2%).
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- This content was originally written in Korean in the DBR, and translated into English by the original author with the aid of AI
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