Shinsegae and Alibaba Form E-Commerce Alliance, Raising Stakes for Coupang
In a groundbreaking move that has captured the attention of the South Korean e-commerce landscape, Shinsegae Group and China’s Alibaba Group have announced a strategic e-commerce alliance set to shake up the market dynamics. The joint venture, revealed on January 6, combines Shinsegae’s popular Gmarket platform with Alibaba’s global e-commerce giant, AliExpress. This collaboration is already drawing significant attention from Coupang, South Korea’s leading online retailer, as executives closely monitor the potential impact on their market dominance.
A Game-Changing Alliance
The new venture is poised to significantly alter the competitive balance in the e-commerce sector. With Gmarket ranking third in South Korea’s domestic market and AliExpress gaining substantial traction in the country since 2024, the merger of their platforms promises to combine their strengths, creating a formidable player in both the Korean and global markets.
Coupang on Alert
Coupang, known for its fast delivery and customer-centric services, is taking the announcement seriously. Sources report that the company’s senior leadership quickly convened after the news broke, holding strategy sessions to assess how this partnership could reshape the competitive landscape. As the market leader in South Korea, Coupang faces increased pressure from the combined might of Gmarket and AliExpress, both of which already hold significant market share.
AliExpress’s Strategic Focus on Korean Products
One of the key drivers behind this partnership is AliExpress’s strategy to leverage Gmarket’s extensive network of over 600,000 sellers. By tapping into Gmarket’s robust infrastructure, AliExpress plans to cater to the growing global demand for Korean products—also known as K-products—especially in markets outside Korea.
However, industry experts believe that the alliance will also see AliExpress intensifying its efforts to capture more of the local South Korean market. This dual focus—on both Korean exports and the domestic market—could place even more pressure on Coupang, which will need to quickly adapt to the changing competitive environment.
As the e-commerce battle heats up, all eyes will be on how Coupang responds to this high-stakes partnership. Will it innovate further, double down on customer loyalty, or take a new approach to fend off this emerging competition? Only time will tell, but this new alliance between Shinsegae and Alibaba marks a pivotal moment for the South Korean e-commerce industry.
AliExpress, Gmarket, and Auction Close Gap with Coupang, as New Alliance Shapes E-Commerce Future
As of December 2024, data from IGAWorks reveals that the combined monthly active users (MAUs) of AliExpress, Gmarket, and Auction reached 13.9 million, nearly half of Coupang’s 32.02 million. While Coupang still leads in transaction volume with an estimated $2.2 billion (holding a 57.53% market share), Gmarket, Auction, and AliExpress together account for $421 million (10.93%).
Analysts are particularly optimistic about AliExpress’s growth potential, predicting that the platform could quickly scale its sales by focusing on high-demand K-products, such as Korean cosmetics, fashion, and tech, to attract even more users.
The recently announced Shinsegae-Alibaba alliance could intensify the competition even further. This partnership could lead to aggressive discount campaigns, putting pressure on Coupang to maintain its dominant position in the market. The timing is critical, as the industry is also witnessing innovations in logistics, such as CJ Logistics’ launch of 7-day delivery services. This will allow platforms like Naver, Gmarket, and AliExpress to offer next-day delivery—even on weekends and holidays—posing a direct challenge to Coupang’s well-known Rocket Delivery service.
Experts warn that these rapid developments could chip away at Coupang’s market dominance, a position it solidified during the Covid-19 pandemic. “Coupang’s once unshakable lead might now face stiff competition from the new Gmarket-AliExpress alliance,” said one industry insider.
The Shinsegae-Alibaba joint venture, along with Naver’s shopping platform, is expected to officially launch in the first half of 2025. With further logistics advancements, such as CJ Logistics’ expanded delivery network, the competitive landscape could shift even more by late 2025.
As the e-commerce market in South Korea continues to evolve, 2025 could prove to be the most challenging year yet for Coupang. Whether the company maintains its dominance, transitions into a duopoly with Naver, or faces fierce competition from Gmarket and AliExpress, the coming months will be pivotal for the future of South Korea’s e-commerce industry.
Conclusion
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For further read please refer to this article : Shinsegae partners with Alibaba to set up joint venture