Interpret the operation mode of the foreign trade industry and share the operation experience of different cross-border e-commerce platforms. Hello everyone, I am Dora, ten years of foreign trade operation and promotion experience, 5 minutes a day, sharing practical dry goods.
When it comes to South Korea, most people's first reaction is Korean dramas and the mature star-making industry, but in fact, South Korea is relying on the advancement of science and technology and a strong consumer culture, and now the e-commerce industry has become the main driving force of the Korean economy.
In South Korea, more than 39.52 million Koreans like to shop online, of which 66.6% of online shopping is done on mobile. And South Korean consumers spend $108.3 billion annually online, making it one of the world's largest e-commerce marketplaces.
Seeing such a prosperous e-commerce industry in South Korea, today I want to talk to you about the advantages and disadvantages of several e-commerce platforms that are more famous in South Korea.
Coupang
Coupang is one of the largest e-commerce platforms in South Korea, founded in 2010 and with over 80 million registered users. Coupang offers a variety of product categories, including fashion, beauty, digital, lifestyle and more. The platform also offers multiple payment methods, a simple shopping process, and multiple discount campaigns at affordable prices.
In 2021, its sales were KRW 2.2 billion, the highest since its establishment in 2010. This rapid growth is a testament to Coupang's popularity and effectiveness as an ecommerce platform. At the same time, Coupang is also the preferred shopping platform for Gen Z.
Merit:
Large user base: Coupang has a large user base and is able to bring a lot of traffic and sales opportunities to merchants. As of the end of 2021, Coupang reportedly had more than 20 million users.
Fast delivery: Has its own logistics system that is able to provide fast delivery, and some items can even be delivered the same day or the next day. In addition, Coupang offers some paid services such as "Rocket Delivery", which can deliver items within 1 hour after the order is confirmed.
Low entry conditions: Only merchants need to apply and review to become partners of the platform, which provides better opportunities for emerging brands and small merchants.
Diversified sales channels: In addition to selling on the Coupang platform, merchants can also take advantage of the advertising services provided by Coupang and other sales channels, such as Coupang Global, Coupang Eats, etc., to expand their sales channels and coverage.
Data analytics and marketing support: Provide a variety of data analysis and marketing tools to help merchants better understand their user groups and market needs, improve sales efficiency and revenue.
Shortcoming:
Fierce competition on the platform: Merchants on the platform are highly competitive, and some brands and merchants may experience sales bottlenecks and need more marketing and advertising to increase visibility and sales.
High commissions and fees: High commissions and fees for merchants, such as up to 15% commission rate for selling goods on the platform, and other additional fees, such as advertising fees, etc., that require fine management by merchants.
Strict requirements for merchants: The requirements for merchants are very strict, and merchants need to provide high-quality goods and fast and accurate delivery services, otherwise they may face problems such as returns and bad reviews.
Regulatory and policy risks: With the rapid development of the Korean e-commerce market, the government's supervision of e-commerce platforms is also gradually strengthened, and some new policies and regulations may have a certain impact on merchants, which need to be understood and responded to in a timely manner.
Gmarket
Gmarket is one of the largest integrated e-commerce platforms in South Korea, founded in 2000 and with over 100 million registered users. Gmarket offers a variety of product categories, including fashion, beauty, digital, lifestyle and more. The platform also offers a variety of payment methods, fast shipping services, and multilingual websites to make it easy for overseas consumers to shop.
merit
Diversified sales channels: Gmarket provides a variety of sales channels, including C2C (consumer-to-consumer), B2C (business-to-consumer) and B2B (business-to-merchant), which can meet the sales needs of different types of merchants.
Large number of users and exposure: It is one of the largest e-commerce platforms in South Korea, with a large number of users and traffic, through which merchants can quickly increase brand exposure and sales.
A variety of marketing tools: The platform has a variety of marketing tools, such as platform coupons, VIP membership cards, recommended ads, etc., which can help merchants increase user conversion rate and loyalty.
Secure payment system: Gmarket's payment system adopts SSL security protocol and electronic authentication technology to ensure the transaction security of merchants and users.
Shortcoming:
High fees: The Gmarket platform has high commissions and advertising fees for merchants, which requires fine management and budget control for merchants.
Strict regulations and requirements: Gmarket has strict regulations and requirements for merchants' product quality, after-sales service, etc., and merchants need to carefully manage and follow up, otherwise they may face problems such as returns and bad reviews.
Naver
Naver's main business is not e-commerce, but since June 2021, it has achieved good results by focusing on smart stores, open market methods, launching brand stores and shopping live broadcasts.
Merit:
Large number of users and traffic: Naver is one of the largest portals and search engines in South Korea with a large number of users and traffic, and merchants can quickly increase brand exposure and sales through Naver.
Secure payment system: Naver's payment system adopts SSL security protocol and electronic authentication technology to ensure the transaction security of merchants and users.
Shortcoming:
High commissions and advertising costs: Naver has high commissions and advertising costs for merchants, which require fine management and budget control from merchants.
Lack of support for small businesses: Due to high competition, Naver may prefer to work with established brands and large merchants, with relatively little support and assistance for small merchants and new entrants.
Auction
Auction is the first e-commerce company in South Korea, founded in 1995 and currently has millions of users. Auction offers a variety of merchandise categories, including fashion, beauty, digital, lifestyle goods, and more. The platform also offers a variety of payment methods, a simple shopping process, and a variety of discount activities to make it easier for consumers to shop.
merit
Sound after-sales service: With a perfect after-sales service system, we can provide professional customer service and problem solutions for merchants, and improve customer satisfaction and loyalty of merchants.
Efficient logistics distribution system: There is an efficient logistics distribution system, which can provide merchants with fast, accurate and safe commodity distribution services, and improve customer shopping experience and satisfaction.
Good reputation and word of mouth: Auction has a good brand reputation and reputation in the Korean market, and merchants can enhance their image and credibility with the help of their brand advantages.
shortcoming
Relatively high fees: Handling fees and service fees are relatively high, which may increase operating costs for small businesses, and merchants need to do a good job of cost control and profit management.
Insufficient support for new merchants: more inclined to cooperate with well-known brands and large merchants, relatively little support and help for new merchants and small merchants, merchants need to do a good job in their own product and brand marketing.
There are certain gray industries: There are some gray industries on Auction, such as daigou, etc., which may have a certain impact on the sales and reputation of regular merchants, and merchants need to pay attention to avoid risks.
summary
Driven by convenience, speed, and personalization, South Korea's e-commerce industry is growing rapidly. Today's e-commerce industry has also shifted from the original traditional model to social media, live streaming and other multi-mode transformations, which also makes the future of South Korea's e-commerce industry full of many possibilities.