Korea’s e-commerce platforms seek new demand amid stagnant sales

[Courtesy of Gmarket]

South Korea’s e-commerce platforms are scrambling to find new demands as sales have reached a plateau in the domestic market.

Gmarket Inc. has recently created a separate category in its platform to strengthen its “life-care services” such as internet subscriptions, funeral services, rentals, and travel consultations, the company said Monday.

Products that were previously grouped under the “other rentals” category have been separated to enhance search convenience. Consultation-type products such as funeral services, internet subscriptions, rentals, and travel consultations have been clarified so that their monthly fees and contract periods can be checked directly on the first page.

The service of offering sales of intangible products is not new. Demand, however, has been low as they were not noticeable to consumers.

Gmarket, in search of new demand, has chosen to rearrange unfamiliar services to customers among the intangible products already sold in open markets.

The move comes as online platforms struggle to expand.

According to Statistics Korea, retailers’ online sales growth rate halved to 9.5 percent last year from 18.4 percent in 2020. Monthly year-on-year sales growth has also declined this year, with 9.1 percent in January, 7.8 percent in February, and 6.1 percent in March.

Another e-commerce player 11Street Co. has introduced an “apartment management fee” service that allows users to check and pay apartment management fees.

This service allows consumers to view and pay fees anytime, anywhere, and without the need for a separate bill.

“We partnered with Aegis Enterprises Inc., the No. 1 enterprise resource planning (ERP) solution provider in the apartment industry, and launched the service in August 2018 for the first time in the industry,” the company said.

The company is also operating an online long-term car rental service in collaboration with SK Rent A Car Co.

Users can receive online quotes without separate documents or consultation calls, online and around the clock. The service includes more than 30 new car models that SK Rent A Car manages and maintains, including the Tesla Model Y, Hyundai Ioniq 5, Mercedes-Benz EQB, and BMW i-Series.

The e-commerce industry is not the only industry facing a battle for survival.

Offline retailers are also trying to attract customers amid a declining population and aging society.

Emart Inc.’s launch of EV Club, an app-based electric vehicle charging service, is an attempt to bring customers into more contact with Emart by increasing convenience.

With just a few clicks on the Emart app, customers can search for and reserve 24,000 EV chargers nationwide and receive Emart reward points after charging.

In particular, the company partnered with other companies such as Korea Electric Power Corp. (KEPCO), SK electlink, and chargEV to provide access to EV charging stations outside of Emart via the Emart app.

Convenience store chain CU has also gone beyond simply selling instant food and daily necessities to sell rice, vegetables, meat, and frozen fish.