KnowSouth Korea

Reaching and engaging your consumers

FAMILIARISING YOURSELF WITH THE LOCAL MARKET

  • To successfully market products in South Korea, e-retailers must communicate with a potential customer in the local language; Korean. English proficiency in South Korea is moderate, with South
  • Korea ranking 24th in the English Proficiency Index, but these customers are hesitant to transact in a language they are only relatively familiar with.
  • It is essential for retailers to display all elements of their pricing in South Korean Won (KRW) and be transparent about any additional charges. Where international shipping is required, it is essential to be up-front about shipping costs and any export duties or other taxes.
  • Consumers in South Korea expect exemplary after-sales services, including a free, local contact number for advice and support. This should be offered in Korean.
  • Korean consumers expect to be thoroughly guided and informed when they buy products online, so the adequate provision of information is essential. This should be offered via a simple and easy-to-use service.
  • When selling online to South Korean customers, e-retailers must make provision for the online payment methods most-used in Korea, which overwhelming are bank cards . Please see our payments page for more information. The average South Korean consumer (aged 18+) holds four credit cards.
  • South Koreans have very high expectations for speedy and informed delivery; same-day deliveries are commonly offered by domestic Korean e-retailers, as are state-of-the-art order tracking services. Please see our logistics page for more information.

MOBILE OPTIMISATION

  • South Korea has the highest smartphone penetration in the world and the quickest internet speed, and these shoppers are increasingly using mobile devices to shop online. Indeed, a 2014 study found that 44% of respondents had used their smartphone during their previous purchase.
  • Nearly 66% of all South Korean shoppers have purchased a product using a mobile device at some point. Tablets, however, play a marginal role in m-commerce here.
  • South Koreans also spend big on their smartphones, with total purchases on mobile devices skyrocketing in value more than 4x since 2012, representing nearly 1/3 of total e-commerce sales. Mobile optimisation is thus key in this market.
  • Convenience is absolutely key for mobile shoppers in South Korea: over 60% of mobile shoppers stated that convenience was their top priority, as compared with 44% of online shoppers.
  • Mobile consumers in this location often go straight to a retailer’s website or app rather than use a search engine, allowing e-retailers to build brand loyalty. Local m-commerce operators thus use various techniques to bring consumers back to their website/app, such as offering coupons to customers who frequently interact with their mobile site/app.
  • In January 2014, the South Korean government announced plans to build up a 5G mobile network by the year 2020.

CONSUMER PROFILE

  • Fairly well-educated and informed consumers who are almost unrivalled in their technological abilities; South Korea currently ranks 2nd out of 166 countries on the ICT Development Index.
  • Strive to spend money and make purchases efficiently and are resolutely against shopping in time-consuming ways.
  • Have a weakness for discounts and promotions; 66% of consumers surveyed in 2014 rated ‘favorable price and promotions’ as their most important consideration when selecting a vendor.
  • Highly responsive to fashion trends/brands; Korean consumers are reputed to be fairly conformist and so it is important for e-retailers to track trends and local trendmakers.
  • A majority use social media to search for information about potential purchases and to share their own product reviews.
  • Are particularly sensitive to the healthrelated and environmental aspects of a particular product.
  • Spend a high proportion of their disposable income on internet shopping; over a third of South Koreans spend more than half of their total monthly disposable income on online purchases.

PEAK ONLINE SHOPPING

  • South Korean’s busiest online shopping hours fall between 10pm-12am.
  • Order volumes are evenly distributed throughout each week, with a slight increase on Wednesdays.
  • The peak times of the calendar year for online shopping in South Korea include:
    • Children’s Day: 5th May.
    • Independence Day: 1st March
    • Early December and Early January.

MARKETING TOOLS

Companies in South Korea are increasingly seeing the value of digital marketing. The below chart shows current and projected digital ad spend in US Billions between 2014 and 2018.

The reasons behind this increase in resource are apparent; 82% of South Korean consumers surveyed report that they have clicked on a digital advertisement.

South Korea also has the largest mobile digital ad market; almost 2 in 5 digital ad dollars spent by advertisers will be directed towards mobile formats in 2015.

The below chart shows the social media platforms used most by companies and public institutions for marketing purposes in South Korea during 2014

% of respondents who reported using a specific social media platform for marketing purposes in 2014

POPULAR SEARCH ENGINES

POPULAR SOCIAL MEDIA PLATFORMS

In 2014, almost 70% of South Korean internet users were active on social media

Other areas of interest

Meeting your regulatory responsibilities

There are various options available when it comes to establishing yourself in the South Korean market.

Receiving Payment From Your Customers

Bank cards are overwhelmingly the most popular payment method in South Korea.

Getting The Goods To Your Customers

Around 50% of South Koreans have reported that slow delivery is one of their primary concerns.

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