【South Korea】The Jewelry Auction in the Drama ‘VIP’: Does It Really Exist?

The drama ‘VIP’ unfolds the story of a dedicated team managing the top 1% VIP customers of a department store. It not only tells the stories of the people working in the VIP department but also the stories of the VIPs they manage—those who spend hundreds of millions of won annually at the department store—and the various events held for them.
In the 8th episode, a private jewelry auction event took place. Before the formal auction began, there was a fashion show with models wearing the jewelry. During the event, an unexpected situation arose where a top-tier customer, who did not wish to attend the public event, expressed a desire to participate in the auction. This top-tier customer was the female chairperson of South Korea’s number one conglomerate. After discussion, the dedicated team arranged for a proxy to attend the auction on her behalf. The top-tier customer watched the auction via a screen from a separate suite room and placed bids.

Finally, the highlight of the auction appeared: a 40-carat red diamond necklace. The red diamond was known (in the drama) as the rarest and most expensive gemstone, and the necklace was one of only three ever made worldwide. The starting bid was 10.2 billion won. It was eventually sold to the top-tier customer for 2.6 billion won.
In reality, it is difficult to find articles about gems or jewelry in major newspapers or news outlets, excluding advertisements. However, occasionally, there are jewelry/gemstone articles that grace the front pages of foreign newspapers. These are articles dealing with jewelry/gemstones sold at auctions. Perhaps that’s why auction houses like Sotheby’s and Christie’s are names almost everyone has heard at least once. They are the two giants of the global auction market.

Abroad, auctions are already active in various fields beyond real estate and artworks, including wine, boats, and cars, and their scope continues to expand. Jewelry auctions, in particular, are actively conducted at Sotheby’s and Christie’s.

Does a jewelry auction like the one in the drama ‘VIP’ exist in South Korea? The answer is ‘yes.’ However, the situation is different from that abroad. The beginning of jewelry auctions in South Korea can be traced back to public sales of smuggled jewelry and seized assets from tax delinquents. In the past, auctions were used as event promotions or inventory clearance methods for jewelry stores. Until now, because the jewelry industry has been classified as a luxury industry, it has not been recognized as an object of art or investment.
The media also tends to only cover high-priced jewelry sold at auctions, leading to the perception that auctions are a special market dealing only in expensive jewelry. Consequently, in South Korea, jewelry distribution through auctions has become non-mainstream.

Recently, however, jewelry auctions have been gaining momentum. Representative examples are Seoul Auction’s consumer auctions and Korea Jewelry Auction’s B2B auctions. Seoul Auction has been holding jewelry auctions regularly since January 2016, after conducting them sporadically since the 2000s. However, it currently does not hold jewelry auctions. Since October 2016, it has launched a new online auction service called ‘Auction Blue,’ auctioning artworks online every month.

K Auction also began holding jewelry auctions in earnest from March 2019. To revitalize jewelry auctions, it hired an expert to oversee the jewelry team and established an appraisal and valuation system. Both individuals and companies can consign jewelry products, and companies can consign through partnership agreements.
Although jewelry auctions are perceived as a special market dealing only in high-priced jewelry, there is a desire for them to be evaluated as artworks with lasting value alongside their liquidity.

Although the jewelry auction market in South Korea is a step behind compared to developed countries, it is undoubtedly a new route for jewelry distribution. Conducting jewelry auctions has the effect of fairly legitimizing the distribution of previously opaque second-hand jewelry transactions. This is because objective price information for the consigned jewelry is disclosed, the winning bidder is determined through buyer competition, and that transaction information is subsequently made public.
If a new change in the jewelry distribution structure creates a fair competitive system, perhaps a day will come when a 40-carat red diamond is actually traded in a domestic auction, just like in the drama ‘VIP,’ and such news graces the front pages of newspapers.