The revenue polarization phenomenon in the domestic e-commerce sector is intensifying. In the first half of the year, Coupang, Naver, Kurly, and OASIS recorded revenue growth compared to the same period last year, while SSG.com under Shinsegae Group, along with GMarket, 11Street, and LotteOn, saw a decrease in revenue. There are forecasts in the industry that the winner-takes-all phenomenon, centered around certain companies with an economy of scale-based revenue structure, will accelerate.
According to the retail industry on the 19th, Coupang recorded a revenue of 23.4639 trillion won in the first half of this year, which is about a 20% increase compared to the same period last year. The revenue for the second quarter (11.9763 trillion won) set a record for the highest quarterly revenue following the first quarter (11.4876 trillion won). The operating profit for the first half was 443 billion won, up 2244% from the same period last year.
The product commerce business, represented by 'Rocket Delivery,' has driven Coupang's performance. In the second quarter, Coupang added 500,000 new products to Rocket Delivery, and the number of same-day and early morning delivery orders increased by over 40% compared to the same period last year.
In the first half of the year, Naver's commerce sector revenue was 1.649 trillion won, a 16% increase from the same period last year. In March, Naver launched its shopping-exclusive app, 'Naver Plus Store.' Naver noted that the app has successfully established itself in the market, positively contributing to the overall page views and transaction growth.
Kurly's revenue for the first half of the year was 1.1595 trillion won, an 8% increase compared to the same period last year. The operating profit was 3.1 billion won, marking the first half-year profit transfer in its 10-year history. Kurly continues to strengthen its non-food sectors such as beauty, household goods, and electronics while maintaining its strengths in fresh food early morning delivery service, represented by 'Ssaetbyeol Delivery,' boosting both revenue and profitability.
OASIS's revenue in the first half of the year was 283.9 billion won, which is a 9% increase compared to the same period last year. OASIS has maintained profitability since its establishment in 2011, based on a loyal customer base. Revenue from loyal customers increased by 37% year-on-year, and the number of platform visitors rose by 30%. OASIS is differentiating itself in the fresh food delivery industry by strengthening its eco-friendly local food concept.
While emerging e-commerce powerhouses are increasing their revenue, large corporations' e-commerce companies are experiencing a downturn in sales. The drop in competitiveness is attributed to restructuring some business operations in the process of streamlining a revenue structure that incurs losses.
SSG.com and GMarket under Shinsegae Group reported a revenue of 707.1 billion won and 381.8 billion won, respectively, in the first half of this year, a decrease of 12.6% and 24.8% year-on-year. During the same period, operating losses worsened, with 49.1 billion won for SSG.com and 41.9 billion won for GMarket, both deteriorating compared to the same period last year.
SSG.com and GMarket have accumulated losses from 2022 to the first half of this year. These companies have minimized marketing efforts and implemented workforce reductions to decrease their losses, but they have been unable to avoid larger decreases in sales and operating losses.
11Street's revenue in the first half was 224.2 billion won, a decrease of 26.7% compared to last year. 11Street operates a dual business model that combines direct purchase-based sales with an open market platform connecting sellers and buyers. The drop in revenue is due to the reduction of relatively lower profitability direct purchase activities while strengthening the open market. The operating loss in the first half was 19.9 billion won, approximately 8 billion won less than the same period last year.
LotteOn, the e-commerce arm of Lotte Group, generated a revenue of 54.8 billion won in the first half of the year, a 4.9% decrease from the same period last year. Operating losses decreased from 42.3 billion won in the first half of last year to 17 billion won in the first half of this year.
LotteOn reduced its operating losses by transferring its low-profit grocery business to Lotte Mart. Recently, it has sought recovery by officially launching an AI-based personalized beauty exploration app, 'Twiz,' to concentrate on high-margin categories like fashion and beauty.
A retail industry official said, 'For e-commerce companies to enhance their delivery competitiveness to a level comparable to the industry leader Coupang, continuous investment in logistics is necessary. Without the backing of sufficient customer demand-based economies of scale in this process, it is inevitable that they will incur losses.'
He added, 'Currently, companies are employing various strategies, such as reducing direct purchase volumes and strengthening open markets, to escape from losses, but it is difficult to avoid the adverse effects of declining revenues.'