SEOUL, May 6 (Korea Bizwire) — As South Korea’s online gift market is growing rapidly, the nation’s e-commerce businesses are strengthening related services.
‘Online gift’ services allow users to send gifts simply by using a phone number rather than a postal address.
At present, there is are no accurate statistics about the size of the online gift market. However, the industry estimates the size of the market at about 3.5 trillion won (US$3.10 billion). The market is dominated by KakaoTalk Gift.
An e-commerce platform, introduced in 2010 by South Korea’s top mobile messenger KakaoTalk, saw its transaction volume rise by 52 percent last year on a year to year basis, with the number of users estimated at 21.7 million as of the end of December 2020.
Along with the expansion of the market, a wider variety of items, including high-priced home electronics, premium brand products, furniture and artwork can be bought through the platform.
The user base is also expanding from the MZ generation – those in their 20s and 30s – to those in their 40s and 50s.
At SSG.com an online mall operated by retail giant Shinsegae, the revenue generated by gift purchases made by those in their 40s and 50s marked growth of 160 percent last month compared to a year ago, dwarfing the overall gift revenue growth of 111.8 percent.
At 11st, another e-commerce website, customers in their 40s and 50s accounted for 48 percent of the gift transaction volume during the period from April 3 to May 3, higher than those in their 20s and 30s (47 percent).
To meet the increasing demand, an increasing number of online shopping malls are introducing gift functions or strengthening their existing gift functions.
Naver Corp. launched a ‘gift shop’ service that recommends a variety of gifts, starting from Tuesday.
The company also introduced an artificial intelligence (AI) recommendation function for the gift section, aimed at making it easier for users to send gifts while searching or browsing for items.
Home shopping firm SK stoa expanded the application of its online gift function to all of its items starting from this month.
J. S. Shin (firstname.lastname@example.org)