Open Market in Crisis... Finding the Answer to Survival

Coupang and Naver Strengthen Membership
Success with Rocket Delivery and Point Promotions

11st Offers Commission Waiver Up to Certain Sales for Own Brand Products

Gmarket Launches Hyper-Personalized Price Comparison Service for Lowest Price Items at the Top

"Why do you use Coupang?"

In the e-commerce industry, the answer to this question is often cited as 'Rocket Delivery.' It is seen as valuable (merit) because it delivers frequently purchased items such as daily necessities the fastest. Although several e-commerce companies now offer similar services, the dominance of Rocket Delivery remains unshaken, according to the consensus.

Coupang has established itself as a leading e-commerce open market by promoting Rocket Delivery, which delivers orders the next day. Photo by Beomseok Kim, Chairman of Coupang's Board of Directors. [Image source=Yonhap News]

As Coupang established itself as the e-commerce leader with Rocket Delivery, similar open market companies began asking another question: "Where should we place our value?" This means they started contemplating the reasons why consumers should choose them to purchase products. As of the 23rd, the industry says that only Naver has found this answer. Naver attracted customers by offering an incomparable level of points accumulation when purchasing products compared to other companies. This is also why the industry refers to Coupang and Naver as the 'two major powers' of the open market.

Recently, in the market, e-commerce open market companies that have begun testing to find their own value like Coupang and Naver have started to emerge one after another. 11st and Gmarket are representative companies. While other companies have focused on the 'lock-in effect' by strengthening memberships to retain customers according to market trends, these companies are emphasizing establishing their own 'identity.'

11st operates the 'Original Seller Program,' which exempts sellers who sell exclusive products from commission fees up to a certain sales amount. The photo shows An Jung-eun, CEO of 11st. [Photo by 11st]

In the case of 11st, it operates an 'Original Seller Program' that exempts commissions up to a certain sales amount for sellers who sell unique products. Original sellers refer to sellers who have self-produced products or own their own brands. 11st refunds the entire commission incurred until the product order amount reaches 10 million KRW to the sellers as seller cash. According to the industry, the average commission for e-commerce open markets is known to be around 10% of the sales price.

An 11st official said, "To survive in the open market, you need product competitiveness," adding, "We see the reason customers come to 11st to purchase items as the original seller products." He also added, "Although original seller products may be sold elsewhere, by providing benefits such as not charging commissions to sellers, we ultimately expect these to become unique products that can only be found on 11st."

Gmarket introduced a hyper-personalized price comparison service that prioritizes displaying the lowest-priced products when searching for items. This function recommends products that customers can purchase at the most affordable price, considering not only shipping fees but also coupons applicable to the customer. While other companies also offer personalized services, Gmarket claims it is the only one that segments customers' consumption patterns and psychology to provide customized price comparisons. It is reported that Gmarket hired about 100 developers last year to implement this service.

A Gmarket official said, "Ultimately, price determines product competitiveness," adding, "We are improving convenience by providing personalized price comparisons and creating the lowest prices for customers." He emphasized, "By quickly searching for and providing the lowest prices for desired products, the customer's shopping experience will also be greatly improved."