E-Commerce Competition
As WeMakePrice, one of South Korea's largest e-commerce platforms, surpassed 500 billion won (US$444.44 million) in monthly transactions in July, it expects to turn a profit on a monthly basis for the first time.
WeMakePrice announced on August 6 that it posted over 500 billion won (US$444.44 million) in transaction volume in July, reaching a record high. Considering the fact that the turnover in July 2016 stood at 250 billion won (US$222.22 million), the figure more than doubled over the last two years. The growth was largely due to special offer events with differentiated prices, such as today’s special offer and hidden price events.
In fact, WeMakePrice surpassed more than 100 million won (US$88,771) of daily revenues in various categories. The number of deals that exceeded 100 million won (US$88,771) of daily sales in July came to 356. The combined number of “100 million won (US$88,771) deals” stood at 1,239 deals from January to July. With the current trend, the figure is highly likely to reach 3,000 by the end of the year, according to WeMakePrice.
In April, CEO Park Eun-sang sent a letter to partner companies, saying, “We will achieve 500 billion won (US$443.85 million) of monthly transactions in the second half of the year and 600 billion won (US$532.62 million) by the end of the year.” Based on such performance, WeMakePrice aims to return to profit on a monthly basis by the end of the year.
Meanwhile, Coupang posted 2.68 trillion won (US$2.38 billion) in sales last year alone based on its rocket-like speedy delivery service, maintaining top spot in the e-commerce industry for years. The number of products that provide the rocket delivery service is expected to surpass 3 million by the end of this year. With higher demand of rocket delivery goods, the company’s sales dramatically grew but its losses also increased due to the rise in labor costs and other fixed costs caused by the expansion of its logistics center. The cumulative operating losses exceeded 1.7 trillion won (US$1.51 billion) in the past three years.
The industry announced its analysis reports that the rocket delivery service can catch up with Coupang but Coupang is rather expanding the service. This shows a stark contrast between 11Street, WeMakePrice and Ticket Monster which are approaching to the turnaround by reducing losses. Market experts say that Coupang is inevitably making such aggressive move. An official from the industry said, “Coupang had to boost sales by the end of the year and continue to add new businesses like the early morning delivery service in order to attract additional investments.”