The Quiet War in Korean E-Commerce: Speed, Trust and Survival (Image courtesy of Yonhap)
SEOUL, Sept. 23 (Korea Bizwire) — South Korea’s e-commerce sector is undergoing a sharp consolidation, with a winner-takes-all structure emerging as Coupang and Naver entrench their dominance. Smaller players are collapsing or being forced into alliances, while global challengers from China accelerate their advance.
The collapse of mid-tier platforms Tmon and Wemakeprice last year, which left merchants unpaid in what became known as the “Timef” crisis, further eroded consumer trust in smaller operators.
Traditional conglomerates have also struggled: Gmarket, 11st and Lotte On all posted hundreds of billions of won in operating losses in 2024, while Coupang delivered 41 trillion won ($30 billion) in revenue and more than 600 billion won in operating profit.
Meanwhile, Chinese giants AliExpress and Temu have quickly gained traction, recording monthly active users (MAU) of 9.2 million and 8.1 million, respectively, as of August. Coupang remained on top with 34.2 million users, far ahead of Naver’s 4.3 million, according to WiseApp Retail.
An Aliexpress ad in a Seoul subway station. (Image courtesy of Yonhap)
To defend their turf, Korean platforms are racing to diversify strategies. Naver launched its “Naver Plus Store” earlier this year and partnered with Kurly to open Kurly N Mart, expanding into fresh groceries.
Gmarket struck an alliance with AliExpress, allowing Korean sellers to export through Alibaba’s network while also opening its platform to Chinese imports. Temu, which entered Korea in February, is hiring locally and considering a branch office.
Coupang, wary of Chinese rivals’ deep pockets, is pouring more than 3 trillion won over three years into expanding logistics, seeking to make its “Rocket Delivery” network ubiquitous nationwide. Other domestic platforms are following suit, adding seven-day-a-week and faster delivery services.
Coupang reported record annual revenue of 41.29 trillion won last year (2024), a 29% increase from the previous year. (Image courtesy of Yonhap)
Vertical specialists are also scrambling to survive. Olive Young leads in monthly users at 9.5 million by blending offline stores with rapid fulfillment, while Musinsa is expanding brick-and-mortar outlets abroad. Ably is opening its first offline space and a global fulfillment center, and Kurly is investing in U.S. operations and offline events to diversify its brand.
Industry officials say consumer behavior is evolving. “In the past, people bought from the cheapest platform,” said one executive. “Now, trust, capital strength, personalized recommendations and delivery speed matter just as much. A quiet but fierce war is underway to separate the winners from the rest.”
Ashley Song (ashley@koreabizwire.com)
