An Insider’s View of S. Korea’s $92B eCommerce Market
South Korea is a titan in the world economy, exploring the cutting edge of technology, finance, automotive and retail through household brands like Samsung, LG and Hyundai. Its eCommerce market, in particular, is a world leader, clocking in as the sixth largest in the world with an annual revenue of $92 billion. Foreign companies looking to capitalize on this titanic market are running into significant problems, however, particularly in processing payments. One major obstacle is that while 80% of all transactions in South Korea use credit cards, half of issued cards come from a local brand rather than a worldwide provider. This can result in card transaction processing being useful for just 40% of consumers, leaving a vast payments gap. Merchants also face significant challenges when attempting to process Korean transactions from abroad, as the government prohibits the won from being transferred outside the country.
This edition of “ Global Commerce Tracker® ” examines the surging growth of the South Korean eCommerce market. It also explores what Korean consumers look for when it comes to eCommerce and the challenges foreign merchants face when entering this colossal market.
Around the Global Commerce Space
South Korea’s status as an economic powerhouse is growing even more solidified, with a recent study finding that it is now the tenth-largest market for luxury goods in the world. The size of this market expanded by 29.6% year over year to hit $5.8 billion in 2022, and experts predict this growth will continue, hitting $7 billion by 2024. Foreign luxury goods, in particular, are a hot commodity, seeing a sales growth of 37.9% year over year. Experts said this growth was primarily driven by pent-up demand during the ongoing pandemic, augmented by millennials and Generation Z comprising a larger fraction of the spending economy.
South Koreans have grown […]
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