The anticipated acceleration of Chinese e-commerce companies' expansion into the Korean market is becoming a reality. Alibaba Group is aggressively investing in the Korean market through a joint venture with Gmarket and acquisition of a stake in fashion platform Ably. Temu has also launched an open market service, marking its full-scale entry into the Korean market.
Temu's "Direct Entry" Declaration and Alibaba's Increased Investment in Korean Market
According to industry sources on the 18th, Chinese shopping platform Temu has decided to directly enter the Korean e-commerce market.
Temu announced its decision to launch a "Local to Local" (L2L) business, which involves directly distributing Korean products, in addition to its existing business model of selling Chinese products directly to overseas consumers. Simultaneously, Temu launched an open market and began recruiting sellers.
Temu explained, "We have decided to invite Korean sellers to our online marketplace. This will allow Temu to provide Korean consumers with a variety of local products and open up new sales channels for Korean sellers to reach millions of customers."
Previously, it was reported that Temu had been hiring Korean employees in various positions, including human resources, general affairs, and logistics, since the end of last year. This led to speculation that Temu would 본격적으로 direct entry into the Korean market after the hiring process.
Alibaba is also accelerating its expansion into Korea. The previous day, Ably Corporation, which operates the fashion platform Ably, announced that it had appointed Ray Zhang, head of AliExpress Korea, as a non-executive director.
Alibaba invested 100 billion won in Ably Corporation last year, acquiring approximately 5% of Ably's shares. An Ably official explained, "(CEO Ray Zhang's) participation in the board of directors is an extension of the investment."
Late last year, Alibaba's subsidiary, Alibaba International, partnered with Shinsegae Group, a major Korean retail conglomerate. They established a joint venture and agreed to integrate AliExpress Korea, Alibaba Group's e-commerce platform, and Gmarket, a subsidiary of Shinsegae Group. The higher stake held by AliExpress Korea led to analysis that Shinsegae Group had eventually sold Gmarket to Alibaba.
US Tariff Policies Fueling Expansion... "Korean Market Will Be Utilized in Various Ways"
Earlier, after Chinese companies, including Alibaba Group, were hit hard by US President Donald Trump's tariff policies, there were predictions that the expansion of Chinese C-commerce into Korea would accelerate. In a situation where they had to re-examine their strategies in the US market, they had no choice but to pursue diversification into other overseas markets, including Korea.
Industry analysts suggest that C-commerce companies are likely to utilize the Korean market more actively. Potential strategies include accelerating reverse direct sales through startup investment and M&A, and using Korea as a key hub for overseas logistics to reduce the burden of tariffs in the US market.
Alibaba's investment in Ably, the No. 1 fashion company in Korea, is also significant. While Alibaba has been actively recruiting beauty brands, it has not acquired any fashion brands. The industry predicts a high possibility of future M&A.
An industry source said, "AliExpress is expanding its business portfolio by listing beauty brands in 'K-Venue', investing in Gmarket for general merchandise, and investing in Ably for fashion. We will continue to explore various ways to create synergy between reverse direct sales and invested companies in the future."
Another source said, "C-commerce has been actively targeting the Korean market, which has a well-established online market. With K-products gaining global popularity and recent tariff impacts, it has now emerged as a major market. We expect the offensive moves to intensify in the future."
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