Coupang systematically studied suppliers’ production processes and sales data to develop its own branded products, known as private-label or store brands. (Image courtesy of Yonhap)
SEJONG, Oct. 31 (Korea Bizwire) – South Korea’s antitrust regulator has disclosed details of how Coupang, the country’s leading e-commerce platform, analyzed vendors’ product data to develop competing private-label merchandise, according to documents released on October 29.
The Korea Fair Trade Commission (KFTC) revealed in its ruling that Coupang systematically studied suppliers’ production processes and sales data to develop its own branded products, known as private-label or store brands.
“Coupang selected products with high sales volumes and profitability, particularly those with simple production processes, to manufacture under its own brand,” the commission stated in its findings.
The investigation showed that Coupang followed a methodical approach: first identifying products ranking in the top 100 across various categories, then filtering for items with strong sales and profit margins but simple manufacturing processes. The company notably excluded products with high consumer loyalty or those requiring complex technical expertise.
After launching these private-label products, Coupang leveraged its dual role as both platform operator and seller to monitor search rankings and track sales performance, the commission found.
The KFTC determined that Coupang engaged in unfair practices, including manipulating search algorithms and orchestrating employee-written reviews to promote its store brands. However, the commission did not find the company’s basic approach to developing private-label products illegal.
Regulators concluded they couldn’t penalize Coupang for analyzing sales data from products it had directly purchased, noting that most private-label items were simple products like bottled water and wet wipes, making it difficult to prove technology theft.
The commission did impose a 162.8 billion won fine and corrective orders for unfair customer inducement through search algorithm manipulation and other preferential treatment of its private-label products.
Coupang has filed an administrative lawsuit challenging the ruling.
Ashley Song (ashley@koreabizwire.com)
