The fresh food dawn delivery platform Kurly appointed Mr. Kil Kyung-hwan as the Chief New Business Officer (CNO) today, who previously served as the Chief Operating Officer (COO) of Ohouse and the representative of Home Decoration. Industry observers note that Kurly, which started with online grocery shopping and has expanded into beauty and fashion, is now aiming to grow its living category.
According to the Financial Supervisory Service on the 21st, Kurly recorded its first operating profit in the first half of this year. Revenue increased by 7.6% year-on-year to 1.1595 trillion won, while operating profit was recorded at 3.1 billion won. Analysts attribute the improved results to stable growth in the food sector and the increase in transaction volume of third-party logistics (3P) handling fashion and living items.
Buoyed by this, Kurly will launch 'N-Mart' in collaboration with Naver in the second half of this year and will begin a reverse direct purchase business in the U.S. through KurlyUSA, among other diversification efforts. Additionally, it has hired a CNO from outside for the first time since its founding.
In particular, there is speculation that the recently hired head of new business is a living expert, suggesting a focus on that sector. CNO Kil graduated from Seoul National University with a degree in industrial engineering and has worked at SK Communications, Bain & Company, ST Unitas, and TMON, among others, before serving as COO of Bucketplace, which operates the interior platform Ohouse, and representative of Home Decoration.
Currently, Kurly's living business operates alongside fashion in a 3P model. Unlike the 1P (direct purchase) model where Kurly holds inventory and manages deliveries, 3P allows sellers to directly manage their inventory and handle deliveries while paying a commission to the distribution platform.
In the first half of this year, 3P commission revenue reached 13.3 billion won, more than doubling compared to the same period last year. Although the proportion of the 3P business in total transactions remains in single digits, company officials explain that its growth rate is the highest among business divisions, lending credibility to market predictions that Kurly will expand its living business.
A Kurly official said, "CNO Kil is expected to oversee new businesses, including the collaborative venture with Naver starting this year as well as 3P," adding, "It's not just about focusing on the living business; he was brought in based on a history of executing various new businesses."
The living area that includes furniture and interior decor items within the e-commerce market is gaining attention as a new growth market. In the past, buying furniture was commonly done offline, but online consumption has increased due to the COVID-19 pandemic.
According to Statistics Korea, the domestic living market was worth 20 trillion won last year, with furniture transaction volume purchased online rising from 3.5358 trillion won in 2019 to around 5.6 trillion won last year. The online penetration rate of furniture (the ratio of online transactions to retail sales) stood at 49.7%, higher than shoes and bags (39.9%), cosmetics (37.4%), and clothing (31.8%). There are projections that online transaction volume for furniture and interior products will expand to 7 trillion won this year.
Accordingly, fashion platform Musinsa, along with distribution platform CJ OnStyle, is strengthening its living product category. Coupang is also implementing 'Rocket Installation' for some furniture products. Products eligible for Rocket Installation can be ordered before 2 p.m. and will receive free next-day delivery and installation services.
The living vertical platform Ohouse recently opened an offline showroom to increase its brand awareness. Established in 2014, Ohouse started as a platform for furniture and interior items and has grown into a super app that supports interior construction, moving, and cleaning, achieving its first-ever operating profit last year. Traditional furniture companies are also strengthening their online sales. Shinsegae Casa operates the online living platform Good.com, and Hyundai LIVART has made its products available on Coupang.
An industry source noted, "As personal tastes become more segmented and the desire for quality of life increases, interest in living is growing," adding, "It is common to use transaction volume as a valuation metric in e-commerce, but living has lower purchase frequency but higher average transaction value, making it favorable for securing transaction volume and margins."