Corporate Mobile Coupon Bulk Sending Service
Food Service Franchises Successively Suspend Sales
The mobile gift card market (e-coupons) is facing a suspension crisis due to delayed settlements by Wemakeprice and Tmon, subsidiaries of Qoo10, a Singapore-based e-commerce platform. Mobile gift card issuers have consecutively stopped sales at the request of major dining franchises and other companies.
According to the industry on the 2nd, KT Alpha's corporate mobile coupon bulk issuance service, Giftishow Biz, announced on the 31st of last month that it would suspend sales of all Starbucks products. The notice stated, "Please note that sales are suspended at the request of the supplier," and added, "Further notice will be given when sales resume."
Here, Starbucks Iced Americano tall size is sold at a 15% discount for 3,820 KRW, and Cafe Latte tall size at a 12% discount for 4,400 KRW. A KT Alpha official explained the reason for the suspension of product sales by dining franchise companies as, "Due to the Qoo10 issue, sales were suspended at the request of the respective companies."
In addition to Giftishow Biz, the suspension of coupon issuance is expanding across mobile coupon issuance services such as Officecon and Bizcon. Bizcon announced the day before, "According to Starbucks headquarters' guidelines, all Starbucks products will be temporarily suspended from sale," and had previously urgently suspended sales of brands including Happymoney Online Gift Certificates, Google Gift Codes, Online Culture Gift Certificates, Guksunamu, and Hanam Pig House.
Officecon also announced that it would suspend sales of all products from Domino's Pizza, Hollys, Subway, and Lotte Cinema at the request of the brand companies. Furthermore, it stated, "Domino's Pizza, KFC, Bondosirak, Bonjuk, Bonjuk & Bibimbap, and Subway also requested suspension of product sales due to circumstances of coupon issuers supplying products from these brands," and added, "We immediately suspended sales to protect Giftishow customers."
Mobile coupon distribution is conducted based on contracts among brand companies, coupon operators, and platform companies. When a brand company outsources gift certificate issuance, the coupon operator issues or requests issuance, and the platform handles future sales and post-issuance sales. For example, in the case of Starbucks Gifticons, Giftishow issues them in bulk, and companies or platforms sell them; consumers purchase these and exchange them for coffee at Starbucks stores. Starbucks then bills the Gifticon issuer once the exchange is made. In this process, the Gifticon issuer must settle payments with the platform where sales occurred, and the settlement cycle is reported to take up to six months. If settlements are not made, as in the Tmon incident, both the Gifticon issuer and the brand company inevitably suffer damage.
Because of this, anxiety about discounted gift card sales is increasing in the distribution industry. A Domino's Pizza official explained, "Our coupon agency temporarily suspended sales on Cultureland and Danggeun Market to prevent customer damage." Another brand official who decided to suspend mobile coupon issuance relatedly said, "Due to a series of recent incidents, several brands are requesting sales suspension," and added, "Similarly, as a risk management measure, we proactively requested the suspension of sales of physical gift certificates."
Previously, the refund and settlement delay incident involving Wemakeprice and Tmon began when Wemakeprice failed to settle seller payments on time on the 7th. They have been operating by using funds deposited from monthly transactions to settle sales proceeds from two months prior. In particular, various gift certificates were sold at discounted prices through a pre-order and post-use method. The 50,000 KRW Happymoney Gift Certificate was sold for 46,250 KRW, and the 50,000 KRW Cultureland Gift Certificate for 46,400 KRW. The distribution industry views that Wemakeprice and Tmon actively discounted Tmon Cash and gift certificates to raise cash.
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