Korea’s e-Commerce market grew in 2009 despite tough economic conditions
The total value of e-commerce transactions in Korea amounted to 670,886 billion won in 2009, a rise of approximately 6.5% in 2008. The B2B e-commerce transaction value totaled 591,375 billion won, and accounted for 88.1% of the total e-commerce transaction value. Furthermore, B2G (Business to Government), B2C (Business to Customers) and C2C (Customer to Customer) e-commerce transactions accounted for 8.9%, 1.8% and 1.2% of the total, respectively.
B2B e-commerce transactions increased 5.6% from a year before. The B2G and C2C e-commerce transaction value marked a 13.8% and 29.1% increase, respectively from the previous year. The buyer-driven type transaction value totaled 392,815 billion won in 2009, an increase of 3.1% from 2008. Meanwhile, the supplier-driven type and intermediary-driven type transaction value rose by 9.6% and 15.9% from 2008, respectively.
The B2B e-commerce transactions in manufacturing amounted to 375,881 billion won in 2009, occupying 63.6% of the total B2B e-commerce transactions. The B2B e-commerce transactions in wholesale and retail trade amounted to 104,598 billion won in 2009, 17.7% of the total B2B ecommerce transactions. The B2B e-commerce transactions in construction amounted to 55,641 billion won in 2009, occupying 9.4% of the total B2B e-commerce transactions.
The cyber shopping transaction value recorded 20,641 billion won in 2009, rising by 13.7% from 18,146 billion won in 2008. By commodities, the transaction value of sports & leisure appliances and food & beverages increased by 37.4% and 34.0%, respectively from 2008. Meanwhile, the transaction value of travel arrangement & reservation services fell by 6.6% from 2008.
In addition, the total sales of general malls and specialized malls rose 19.1% and 0.3% from 2008, respectively. Meanwhile, the total sales of online-only malls and on and offline hybrid malls rose by 16.1% and 9.1%, respectively from 2008. The Internet cyber shopping market is expanding in Korea, with more and more people becoming accustomed to Internet shopping services.
While the younger generation is seen as the main customers in the Internet shopping market, more and more older people are now clicking to buy products these days. In particular, those in their 30s and 40s are knocking on the doors of Internet shopping malls. As a result, Internet shopping sites have been diversifying products in an attempt to attract more customers. In the past, clothes and electronic products were the main stream, but these days, people can buy almost anything on the Internet. Moreover, the economic slump and rising prices have helped Internet shopping malls attract more customers by offering more attractive prices and settlement conditions than their offline competitors.
Of late, online shopping malls have been expanding into the mobile Internet shopping market beyond the wired Internet world. Interpark launched a discount coupon service for smartphone users, with Gmarket now also operating a mobile shopping service for smartphone users. Gmarket expects mobile shopping will increase thanks to an increase in the number of i-Phone or Android phone users, with Auction planning to begin its mobile shopping service by the end of the first half of 2010.
Meanwhile, offline shopping malls are opening online shopping malls. Lotte Mart has begun selling its products at the Auction site, while E-Mart and Homeplus have banded together with Gmarket and Interpark, respectively. GS Retail has also joined Interpark in a bid to promote its online sales. While Shinsegae and Lotte are considered late comers to the online shopping business, E-Mart has been pushing forward with its enhancement of its system and logistics services in order to expand its online business. The retail company also recently shortened the delivery times of its products. Lotte Shopping is planning to strengthen its digital shopping by developing a digital shopping mall on the basis of mobile and IP TV technologies.