Online Shopping Growth Rate Continues to Slow... Increase in Direct Purchases from China Has Also Eased

Statistics Korea Announces 'September Online Shopping Trends'
Sharp Increase in Communication Device Transactions Due to iPhone Effect

Q3 Overseas Direct Purchases Up 18.9%
Clothing and Fashion Items Account for Highest Purchase Amounts

The ripple effects of the delayed settlements at Tmon and Wemakeprice (Timep) continued, resulting in only a 2% increase in online shopping transaction volume in September. While overseas direct sales in the third quarter decreased by 7.4%, direct purchases increased by 18.8%, reflecting the overseas direct purchase boom. However, the growth rate of direct purchases from China, which had reached the 60% range, was adjusted to 45%.

Online Purchases of Communication Devices Increase by 94.9%

According to the 'September 2024 Online Shopping Trends' released by Statistics Korea on the 1st, online shopping transaction volume in September reached 19.5602 trillion KRW, up 2.0% (377.9 billion KRW) compared to the same month last year. Due to the Timep incident, online consumer sentiment weakened, resulting in low growth rates following July (5.1%) and August (1.9%).

Transaction volumes for product categories such as food services (17.3%), communication devices (94.9%), and food and groceries (10.5%) increased compared to the same month last year. Conversely, categories like e-coupon services (-48.8%) and automobiles and automobile accessories (-39.0%) saw declines.

A Statistics Korea official explained, "The online shopping transaction growth rate, which used to be around 10%, has recently stalled over the past three months." Additionally, they noted, "The communication devices category was greatly influenced by the release of new products (iPhone). Since last year's new product launch was in October and this year it was in September, there was a significant increase compared to the same month last year."

Among online shopping, mobile shopping transaction volume was 14.9247 trillion KRW, up 7.7% (1.0684 trillion KRW) compared to the same month last year. The share of mobile transactions rose by 4.1 percentage points to 76.3%. Mobile transaction volumes increased in categories such as food services (17.7%), food and groceries (14.7%), and communication devices (91.6%), but decreased in e-coupon services (-35.2%).

Growth in Overseas Direct Purchases... China Direct Purchase Growth Rate at 45%

According to the 'Q3 2024 Online Overseas Direct Sales and Purchase Trends' also released by Statistics Korea, online overseas direct sales in the third quarter amounted to 419.1 billion KRW, down 7.4% (33.6 billion KRW) compared to the same period last year. Sales increased in the United States (51.6%) but declined notably in China (-22.2%) and the European Union (-37.4%).

Among online overseas direct sales, duty-free shop sales were 225.1 billion KRW, down 17.1% (46.4 billion KRW). By region, duty-free sales were highest in China (211.4 billion KRW), followed by ASEAN (8.5 billion KRW), Japan (2.7 billion KRW), and the United States (1.3 billion KRW).

On the other hand, overseas direct purchases in Q3 reached 1.9106 trillion KRW, an increase of 18.8% (302.7 billion KRW) compared to the same period last year. Purchases decreased in the United States (-10.0%) but increased in China (45.0%), Japan (25.3%), and Canada (4.3%). In terms of sales volume, China (1.162 trillion KRW), the United States (406.1 billion KRW), and Japan (135.5 billion KRW) ranked highest.

By product category, purchases decreased in food and groceries (-3.8%) but increased in clothing and fashion-related products (12.2%), household and automobile goods (81.4%), and home appliances and electronics (20.7%). The purchase volume of clothing and fashion-related products was 796.1 billion KRW, accounting for the largest share.

Statistics Korea attributed these results to increased direct purchases through overseas online platforms such as Alina and Temu. A Statistics Korea official explained, "In the case of China, there was a high growth rate in the 60% range for three consecutive quarters starting from Q4 last year," adding, "The growth rate slowed down in Q3."