Coupang’s delivery trucks (Image courtesy of Yonhap)
SEOUL, Jan. 7 (Korea Bizwire) — Shinsegae Group and China’s Alibaba Group have joined forces to form a strategic e-commerce alliance, a move that has drawn close attention from Coupang, South Korea’s market leader in online retail.
The partnership, announced on January 6, could significantly alter the competitive dynamics of the e-commerce sector.
Coupang’s senior executives reportedly convened shortly after the announcement to assess the potential impact and develop counterstrategies. The collaboration will create a joint venture involving Shinsegae’s Gmarket and Alibaba’s AliExpress, both of which hold significant market presence.
Gmarket is ranked third in market share domestically, while AliExpress has shown remarkable user growth in South Korea since 2024.
The joint venture set to be established this year will include Gmarket and Alibaba Group’s e-commerce platform, AliExpress Korea. The photo shows the exterior of Shinsegae Department Store in Myeongdong, Seoul, taken that afternoon. (Yonhap)
AliExpress’s strategy centers on leveraging Gmarket’s 600,000 sellers to meet growing demand for Korean products (K-products) abroad. However, industry observers believe that AliExpress will also intensify its focus on the Korean market, raising the stakes for Coupang.
According to data from IGAWorks, as of December 2024, the combined monthly active users (MAUs) of AliExpress, Gmarket, and Auction reached 13.9 million—nearly half of Coupang’s 32.02 million.
The exterior view of Alibaba Group’s headquarters in Hangzhou, China. (Image provided by AliExpress)
While Coupang leads in transaction volume with an estimated ₩3.23 trillion (57.53% market share), Gmarket, Auction, and AliExpress collectively accounted for ₩614.6 billion (10.93%). Analysts predict AliExpress could rapidly scale its sales by increasing the share of high-value K-products.
The new alliance may also escalate competition through aggressive discount campaigns, setting the stage for a direct showdown with Coupang. Coupled with recent logistics innovations, including CJ Logistics’ introduction of 7-day delivery services, the market could see significant shifts.
This logistics upgrade benefits platforms like Naver, Gmarket, and AliExpress, allowing them to offer next-day delivery on weekends and holidays—a direct challenge to Coupang’s signature Rocket Delivery service.
Industry insiders suggest these developments could erode Coupang’s dominance, a position solidified during the COVID-19 pandemic. “What seemed like an unshakable lead for Coupang may face challenges from the Gmarket-AliExpress alliance,” one expert noted.
The Shinsegae-Alibaba joint venture, along with Naver’s shopping platform, is expected to formally launch in the first half of 2025. Logistics enhancements, such as CJ Logistics’ expanded delivery network, may further shape the competitive landscape by late 2025.
As the e-commerce sector evolves, 2025 is shaping up to be the most challenging year for Coupang since its rise to dominance during the pandemic.
Whether Coupang cements its position, transitions to a duopoly with Naver, or contends with Gmarket-AliExpress as a significant rival, the coming months will serve as a defining moment for South Korea’s e-commerce market.
Ashley Song (ashley@koreabizwire.com)
