Korea Ecommerce Trends in 2020


Korea Ecommerce Trends in 2020

Want to gain insights on South Korea's business trends? We've got you covered. If you're thinking about business expansion in South Korea, then you've got to look into the country's economic growth, consumer behavior, and marketing statistics. You've got to look not only on present numbers, but also on the past ones. This will let you recognize patterns and predict future market growth. In this article, we've compiled the ecommerce trends in Korea for year 2020.


South Korea is one of the biggest ecommerce markets worldwide. With sites like NAVER Shopping, Coupang, eBay Korea, Wemakeprice and TMON, Koreans have more choices and reasons than ever shop online. According to statistics in 2022, about 28 million South Korean internet users purchase products or services online per year. After looking at the 2020 data, you'll see how much these numbers have grown, and gain insight on how much it might grow in the coming years.


OVERVIEW OF CONSUMER GOODS ECOMMERCE IN SOUTH KOREA

As a consumerist nation with an internet usage rate of about 98%, Koreans are most likely to turn to the internet to search about, discover, and purchase an item or service that they are seeking. Different industries such as fashion, beauty, luxury, cryptocurrency, tech, gaming, music, and fitness have already transitioned to ecommerce platforms to gain more sales.


Keep reading to learn about Korea's domestic ecommerce trends, as well as the growing number of transactions on foreign markets for Korean products.



South Korea Ecommerce Trends 2020 ⬇️

  1. Online Shopping Transaction Value in Korea

  2. International Online Shopping on Korean Sites

  3. Korean User Purchases from Foreign Sites



1. Online Shopping Transaction Value in Korea


Online Shopping Transaction Value by Category in Korea, 2019-2020
Data from Statistic Korea, Chart Made by AJ Marketing

In 2020, transaction value of culture and leisure services (-69.3%), travel arrangement and transportation services (-53.3%) declined.

Online shopping transaction value of food services (78.6%), food & beverages (48.3%) and household goods (44.1%) increased.


Top 3 categories that took the largest share of online shopping transaction value were food & beverages (12.4%), home electronics and telecommunication equipment (11.8%), and food services (10.8%).


As we can see, these numbers show the economic decline of the travel and leisure industry due to the ongoing COVID-19 pandemic. Meanwhile, South Koreans utilized internet shopping to purchase essentials like food and household goods. Cosmetics and clothing items remain stable.



2. International Online Shopping on Korean Sites


International Online Sales and Purchases in Korea, 2018 Q4-2020 Q4
Data from Statistic Korea, Chart Made by AJ Marketing

In the fourth quarter of 2020, the Korean site online sales to foreign users decreased by 18.2% to 1.5 trillion KRW, whereas the Korean user purchases from foreign sites increased by 25.9% to 1.2 trillion KRW.


Decrease in the Korea site online sales to foreign users was strongly impacted by a sharp drop in online sales of Duty Free online sites.


Korea Site Online Sales to Foreign Users by Region, 2019-2020
Data from Statistic Korea, Chart Made by AJ Marketing

Online overseas direct sales amounted to 5.96 billion won in 2020, down 0.6% from the previous year. Online overseas direct sales compared to the previous year increased in China (0.9%) and the US (20.5%), but decreased in ASEAN (-31.4%) and Japan (-13.6%).


Korea Site Online Sales to Foreign Users by Category, 2019-2020
Data from Statistic Korea, Chart Made by AJ Marketing

Records, videos, and musical instruments increased (132.2%) in 2020, compared to the previous year. Cosmetics also increased slightly (1.1%), but clothing and fashion-related products (-32.4%), home appliances, electronics, and communication equipment (-41.4%), food and beverages (-40.7%) saw a decrease compared to the previous year.



3. Korean User Purchases from Foreign Sites


Korean User Purchases from Foreign Sites by Region, 2019-2020
Data from Statistic Korea, Chart Made by AJ Marketing

Korean users were reported to making more transactions from foreign sites in 2020 compared to the previous year. The amount of online overseas direct purchases by country increased for every country in this report. The three largest market countries observed were the US (3.5%), the European Union (21.7%) and China (24.4%).


Korean User Purchases from Foreign Sites by Category, 2019-2020
Data from Statistic Korea, Chart Made by AJ Marketing

When looking at Korean user purchases from foreign sites, most categories saw an increase in 2020 compared to the previous year. Categories that saw an increase include food & beverage products (22.5%), clothing and fashion-related products (11.8%), household goods, and automotive supplies (34.6%).



Conclusion


In Korea, online retail transactions became as common, if not more, than physically going into a store and purchasing products. The South Korean nation is a tech-savvy one, with 98% of its population being internet users. Their technology, added with the restraints of COVID-19, influenced their online purchasing behavior. For this reason, the ecommerce industry grew in year 2020, and has continued to grow today in 2022.


A good market research looks into past, present, and future numbers. We hope you gained some business insights and intelligence in the data above. To know more about marketing and advertising in South Korea, visit the AJ Marketing Blog.


To learn about about Korea market, see more of our business intelligence reports:




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