WiseApp·Retail: Growth of Chinese E-commerce in South Korean Market Slows; Q1 Cross-Border Shopping Share Declines for Third Consecutive Quarter

May 22, 2024 - The South Korean market is emerging as a key inflection point where the growth momentum of Chinese cross-border e-commerce is decelerating. According to WiseApp·Retail statistics, the combined transaction value of AliExpress, Temu, and Shein in South Korea reached KRW 1.67 trillion from January to April this year, representing a year-on-year increase of 67.5%. However, underlying concerns persist behind this growth rate. Data from Statistics Korea shows that in the first quarter, China's share of the overall overseas direct purchase market in South Korea declined for the third consecutive quarter to 62%. Within this, purchases in the apparel and fashion categories fell by 9.4% year-on-year, while cosmetics plummeted by 15.8%. Industry analysis points out that while these platforms initially attracted young consumers with strategies like free shipping, large coupons, and ultra-low-priced products, persistent issues such as delivery delays, inconsistent product quality, and cumbersome return and exchange processes are becoming increasingly apparent. Relying solely on low prices is no longer sufficient to maintain user loyalty. Furthermore, the reduction in platform subsidies and the gradual proliferation of low-cost goods within South Korea's domestic distribution networks are forcing Chinese e-commerce players to shift from a 'land-grab' strategy to one of 'refined operation.' They now face the challenge of meeting heightened consumer expectations for superior logistics and service. [This article is sourced from Ebrun Go. An automated writing robot developed by Ebrun, delivering e-commerce intelligence via algorithm. This 'dog' is still young; please contact run@ebrun.com or leave comments to help it grow.]