Young people become the target of competition, and South Korea's nearly 100 billion fashion e-commerce market is gradually making waves

According to local media reports in South Korea, South Korean technology giant Kakao is currently taking steps to acquire fashion e-commerce platform Zigzag.

The deal would reportedly see Kakao acquire a controlling stake in the shopping app operator - estimated to be worth around $1 billion - and create a new subsidiary for the merger.

Zigzag, which was launched in June 2015, is the most used app among Koreans in their 20s after Coupang (as of November last year), and is also widely used by teenagers. It claims to have 3 million active users per month last year and recorded transactions worth 750 billion won (671 million U.S. dollars).

Layout of the younger generation

Today, whether it is South Korea's Internet giants Naver and Kakao, or traditional retail giants Lotte and Shinsegae , they are all scrambling to build and expand fashion platforms in order to attract young consumers in their teens and twenties .

Zigzag·W Concept·Lotte on

In addition to Kakao's plan to acquire Zigzag, earlier this month, SSG.com, a subsidiary of Shinsegae Group, announced the acquisition of W Concept, a women's fashion e-commerce platform. Lotte has also introduced more than 100 online clothing shopping malls since the beginning of this year and opened a fashion store in April.

Although Lotte and Shinsegae both operate their own online shopping platforms such as Lotte On and SSG.com , their market share is only 4-5%. Their main customers are also in their 30s and 40s, just like those of large supermarkets and department stores.

Therefore, the two companies plan to increase the influx rate of the younger generation through online fashion shopping platforms , unite customers of online clothing brands, and guide them to become future customers of supermarkets, department stores, and online shopping malls.

Seize the e-commerce market with fashion

Last year, South Korea's online transaction volume exceeded 15 trillion, with a total transaction volume of 15.34 trillion won (about 90 billion yuan).

Online clothing transaction amount

South Korean e-commerce giants Naver and Coupang have also been prepared to face the pressure from latecomers.

Naver, which ranks first in e-commerce market share ( 17.1%), launched "Style Window" in 2014, which collected information on offline clothing stores, and launched "Mr.", an online shopping mall for men's fashion, last year. According to Korean media, Naver plans to increase its market share to 30% by 2025 through its fashion business.

Coupang, which attempted to acquire Zigzag in 2019 but ultimately failed, also launched C Avenue, an online fashion shopping mall, in April last year, and strengthened its fashion power by attracting famous brands such as Beanpole, Lacoste and New Balance.

Facing this nearly 100 billion new market, according to Korean media predictions, Musinsa, the No. 1 online fashion e-commerce company in Korea, may also consider acquiring a women's fashion platform. Musinsa's transaction volume last year was 1.2 trillion won, and its scale has increased threefold in two years, but the proportion of male members is as high as about 55%, and there is still a lot of room for growth in female members.

South Korea

Acquisition

young people