Coupang said Thursday it is ending its social commerce offerings to wholly transition into an e-commerce company.
The company will be immediately discontinuing its social commerce deals, which included limited-time discount coupons for local restaurants and services such as beauty salons.
Coupang began in 2010 as a social commerce company, meaning its main focus was on local service deals and group-buying coupons. In 2012, it began moving into the e-commerce space.
“We decided that our open market and direct selling services were the most effective in promoting customer satisfaction, and we saw that business grow by 2,400 percent,” a spokesperson for Coupang said.
To date, Coupang has delivered more than 450 million shipments to its e-commerce customers. Social commerce deals make up only about 0.2 percent of all sales on Coupang.
The company has been developing various convenience services to promote customer loyalty, including Rocket Delivery and RocketPay. Rocket Delivery provides free next-day shipping on orders of more than 19,800 won ($17.30) on products directly sold from Coupang, while Rocket Pay allows for quick, one-touch payment.
Coupang has been investing heavily in these types of conveniences for consumers to grow its base of loyal customers.
Last November, Coupang ended its contract with Naver, removing Coupang products from price comparisons searched on the site. Coupang said that the decision was based on data showing that its customers were coming to the platform directly through the Coupang app.
Coupang’s Senior Vice President of Global E-commerce Navid Veiseh said, “We are excited to complete this transformation. Our customers have made us Korea’s fastest growing e-commerce business. We are accelerating technology investments and are committed to creating a superior customer experience across each of our business categories, including travel, cross-border shopping and RocketPay services.”
The transition does not put Coupang in direct competition with e-commerce strongholds that focus on an open market platform such as eBay Korea’s Gmarket and Auction, or SK Planet’s 11st. Coupang directly buys and ships most of its products, with additional products offered through individual sellers on its item market.
By Won Ho-jung (email@example.com