Online stores brace for Amazon's arrival

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Online stores brace for Amazon's arrival

The nation's major online stores are diversifying their stock and offering a host of promotional events to strengthen their customer base ahead of the arrival of the world's largest online retailer, Amazon.

Amazon, which recently opened a Korean office, is expected to start operating this year.

Online shopping malls such as Gmarket, 11ST, as well as social commerce sites are overhauling their business strategies to develop unique and mobile commerce services.

Gmarket, eBay's Korean online shopping unit, is upgrading its social commerce webpage G9 and mobile commerce business to capture more customers and retain existing ones.

The online shop said it will boost its mobile commerce services throughout the year, starting by launching an e-coupon corner last January, which sells up to 70 mobile coupons for a wide range of stores from bakeries to beauty stores.

The online shop increased the number of G9 product deals from nine to 150 in April last year. It also improved its web interface to launch additional product categories.

SK Planet's online store 11ST boosted its services by adding unique selling items to its deal-of-the-day service, Shocking Deal, this year. The firm increased the number of luxury goods tenfold. It sells some 2,000 products on Shocking Deal and plans to increase this number to 7,000 this year.

It also held some attractive promotions. For example, on March 10, the firm sold its limited edition Leica M9-P "Edition Hermes" camera on Shocking Deal for 29.9 million won, 17 percent lower than its original price.

SK Planet also boosted its mobile commerce business by launching Baro Mart in November last year, offering popular supermarket products and delivers them to customers at no charge.

Meanwhile, social commerce sites are preparing for Amazon's arrival by building warehouses.

Ticket Monster is looking for a site for its new warehouse near Seoul because it aims to expand its fresh food delivery services this year, an official at the firm said. It currently has a 4,950 square meter warehouse. It also launched a service that enables customers to buy directly from overseas online stores in November last year.

WeMakePrice said it finished building a 19,800 square meter warehouse in Gwangju, Gyeonggi Province last month and plans to move all its products to the new warehouse in a few months.

Coupang has leased a 15,500 square meter warehouse in Paju, Gyeonggi Province, in addition to its current 10,900 square meter warehouse, according to the Chosun Ilbo on Feb. 10.

"Korean online firms are working to raise customers' loyalty and brace for Amazon's arrival," said analyst Young Ryu at Daewoo Securities.

"Accordingly, they will boost aspects of their services such as delivery, product quality and unique content, the way Interpark has upgraded its travel and entertainment ticket services. Online stores that don't have their own unique characteristics won't survive when Amazon starts its business here." The Korea Times, May 17^th, 2014.