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An Overview of E-Commerce Trends in South Korea

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An Overview of E-Commerce Trends in South Korea AN OVERVIEW OF E-COMMERCE TRENDS IN SOUTH KOREA BASIC ELEMENTS TO CONSIDER FOR SMALL AND MEDIUM-SIZED ENTERPRISES (SMEs) DOING BUSINESS IN SOUTH KOREA VIA E-COMMERCE CHANNELS QUICK FACTS (2015) Population One of the world’s most connected countries Online food and drinks purchases $4.8B 50.6M 99% of households have GDP/capita access to the Internet. 75.2M $27,282 devices connected Forecasted to be to the Internet 97% of households are $7.7B by 2020 in possession of a mobile (10% growth). telephone. Consumer spending E-commerce growth potential $ Millions $66.28 Total consumer food and drinks spending: $56.17 $130.5B $47.59 $40.32 Food and drinks spending per capita: $34.16 $2,321 $30.34 Online food and drinks spending per capita: $94 2015 2016 2017 2018 2019 2020 s TOP METHODS OF ACCESSING THE INTERNET FOR SHOPPING 46% of e-retail 34 million transactions are made 29 million 9.9 million mobile phone users via mobile phone. personal computer users tablet users GETTING THE GOODS TO YOUR CUSTOMERS TOP INTERNET E-COMMERCE RETAILERS South Korea is one of the world’s most densely 9.815 $ Billions populated countries, with its citizens largely 9.355 centred in and around the most populous cities. South Korea’s Largest Cities Seoul 6.704 Incheon (10.1 million) (2.9 million) Daejeon (1.5 million) 4.003 Daegu 3.724 (2.5 million) Busan (3.5 million) South Korea has one of the world’s most advanced and extensive logistical infra- structures, including a highly advanced rail network. Lottemall Shinsegae Homeplus GS Retail BGF Retail Note: All dollars are in US funds. SOUTH KOREAN CUSTOMER BEHAVIOUR & TRENDS Are well-educated and informed consumers who are unmatched in their technological abilities. Strive to spend money and make purchases efficiently. SOUTH KOREAN Are particularly sensitive to health and wellness claims and are environmentally CONSUMERS: responsible. Spend a high proportion of their disposable income on internet shopping; over a third of South Koreans spend more than half of their total monthly disposable income on online purchases. South Koreans have Customer interaction Payment methods: very high expectations through social networking: for speedy and • Korean consumers expect to be • Mainly pay by credit cards. trackable delivery. directed throughout the online • Cash-on-delivery is less popular. buying process. Same-day deliveries • Consumers favour a simple and are commonly offered easy-to-use service and process. by domestic South Korean e-retailers. UNDERSTANDING SOUTH KOREA’S ONLINE MARKETPLACE South Korean retailers are increasingly introducing e-commerce models that make it even easier for tech-savvy, time-crunched consumers to get the items they need. Homeshopping malls such as GS Shop, Huyndaimall, CJ O shopping and Lottemall are popular and are also available online and mobile. In 2011, Tesco introduced the first virtual supermarket in a South Korean subway system, and the model has spread to other markets. COMPANY SPOTLIGHT ON E-MART (HYPERMARKETS) PART OF SHINSEGAE IN SOUTH KOREA Market leader in the South Korean hypermarket sector. E-mart stores are extremely popular with South Koreans, with their mix of low price points and modern, outlets. Stores are especially strong in fresh produce and Korean foods. E-mart carries a whole range of attended service counters serving E-MART seafood (including live produce), meat, cheese, bakery and deli. ONLINE The website Emartmall.com carries up to 10,000 different grocery items, including fish, fresh seaweed and ginseng. Around 10-20% of the product range is exclusive to the online operation in order to differ- entiate it from rivals and physical E-mart stores. Deliveries are fulfilled from E-mart stores. Give yourself an edge by To join our distribution list, make a suggestion, Visit our online library registering to receive Agriculture or request a report, please contact the Market of public reports for Access Secretariat at: more information on and Agri-Food Canada Global this and other markets. Analysis reports today. [email protected] AAFC No. 12578E | Cat. No. A72-131/4-2016E-PDF | ISBN 978-0-660-06275-4.
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