Widely known as the “Amazon of South Korea,” Coupang has firmly established itself in the lives of many Koreans becoming the biggest online marketplace in the country and its third-largest employer since it was founded in 2010. For brands wanting to expand internationally, or tap into the South Korean market should consider selling on Coupang due to the size of South Korea’s growing ecommerce market and the increasing demand for international products.
South Korea’s Growing Ecommerce Market
South Korea is the 6th largest ecommerce market in the world, with a predicted revenue of US $101.80 billion in 2023. The South Korean ecommerce market is estimated to show an annual growth rate of 3.45%, resulting in a projected market volume of US $116.60 billion by 2027, making it an attractive market for international brands.
In addition, South Korean online shoppers are extremely well connected to the world of ecommerce. The consumer society has an internet usage rate of 93% among the population–the highest percentage in the Asia Pacific region. Brands looking for a great online marketplace opportunity in the Asia-Pacific region can do very well in South Korea.
Coupang is South Korea’s Biggest Online Marketplace
The biggest player in the South Korean ecommerce market is Coupang. Its growth strategy for the next few years includes attracting more customers, increasing customer engagement, and growing its product selection, funded by a highly successful IPO in the USA, raising $4.6 billion. Much like Amazon, Coupang is focused on offering a broad selection at the lowest prices available in the market.
Coupang has built its own end-to-end infrastructure including logistics and technology, which has allowed it to differentiate its offer and maximize efficiencies. To stay one step ahead of competitors, Coupang has also invested heavily in convenience, particularly around speed of delivery and ease of returns.
Korea’s Increasing Demand for International Products on Coupang
While 70% of merchants on the marketplace are small businesses, it is also a channel to market for larger international brands. LEGO, Gap and Nature’s Way are just a few examples of large brands who have begun selling on Coupang.
What’s more, Coupang’s profile has increased significantly outside of South Korea in the last couple of years. In late 2019, it launched a global partner program to help international brands enter South Korea using the platform; this included the opening of international warehouses, such as one in California where US brands can store goods to be sold cross-border.
Go International with Pattern
As a brand wanting to expand internationally, make sure to consider the many successful marketplaces that could be a catapult for your brand’s success internationally. Navigating your brand’s international expansion on your own can be intimidating, even with the best of internal ecommerce teams. Many find themselves ill-equipped to meet the global, multi-channel demands of international ecommerce, but our expert teams can help you successfully strategize about how to move forward.
If you’re interested in selling on Coupang or other international marketplaces, Pattern can help. Pattern runs a market ranking exercise for the brands we partner with, to determine which APAC markets and marketplaces are the best fit for their brand and provide the most opportunity. Factors we consider include product suitability, existing cross-border sales, brand awareness, local competition, and the cost of acquisition marketing to drive sales. This type of analysis can help a brand to determine the opportunity to enter South Korea through selling on Coupang.
As a global ecommerce accelerator, Pattern has helped brands successfully expand to all major international marketplaces. To learn more about selling on Coupang—or to discuss how we could help to grow your Asia Pacific online sales—contact us today.