South Korean e-commerce giant Coupang Inc. which pioneered superfast door delivery is applying its winning strategy for overseas purchases
Coupang signed a memorandum of understanding with Korea Customs Service to enhance e-commerce clearance and distribution system efficiency at Seoul Central Customs in southern Seoul.
Under the MoU, Coupang will share data of products purchased by customers from overseas sellers via its platform, such as order, payment, and delivery information, with the customs authority so that it can carry out prior verification and fast clearance.
Under the partnership, the Korean customs office will shorten customs inspection process for online products sold by vendors categorized as reliable for faster delivery and block high risk products from overseas for consumer convenience.
Speed could define the competitiveness in direct online shopping that ballooned during Covid-19 year.
According to Statistics Korea on Tuesday, direct overseas purchase by Koreans surged 44.2 percent in the first quarter of this year from a year-ago period to 1.4 trillion won ($1.3 billion). The value is expected to top 6 trillion won this year, up 1.5 times from last year.
The annual volume reached 4.11 trillion won last year, up from 2.97 trillion won in 2018 and 3.64 trillion won in 2019.
While demand for luxury and home appliance items remain popular, Korean consumers also look for better deals of fashion and food items on foreign e-commerce sites.
By category, Korean consumers bought 504.2 billion won worth apparel and fashion items from overseas in the January-March period, food items 329.5 billion won, and electronics, home appliance, and telecommunications devices 132.8 billion won.
According to Koreacenter, which runs overseas direct purchase platform Malltail.com, popular American fashion brands such as Polo, Gap, and Lacoste are offered at up to 90 percent cheaper prices on the foreign e-commerce sites than those sold in local markets. Bluetooth speakers are sold at up to 30 percent less, and UK handmade body care brand Lush at 40 percent than in Korea.
Direct purchases in the past were mainly large home appliances like TVs and vacuum cleaners but as the practice becomes more common in Korea, shoppers have moved to a variety of items in fashion, small home appliance, and lifestyle product categories, said an official from Koreacenter.
To meet heated demand for overseas purchases, Coupang has expanded the list of markets beyond the U.S. to China. It sells about 5.7 million overseas items from 12 categories. Health supplements are highly sought from the U.S. while small home appliances like gaming mouse and Bluetooth wireless headphones from China.
Smaller players have also joined the competition.
Lotte ON and GS Shop have partnered with Korean overseas shopper startup Guhada to offer consumers direct purchase service of luxury items.
By Kim Gi-jung, Park Dae-eui, and Lee Eun-joo
[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]