Summary:
- Temu and AliExpress are driving growth in South Korea’s direct purchasing from China, surpassing KRW 3 trillion in 2023.
- Temu’s transaction volume rapidly increased, nearly matching AliExpress.
- Consumer transaction data indicates rising market share and retention rates for Temu.
- Strategic investments by Temu and AliExpress aim to attract and retain customers.
Temu and AliExpress Drive Chinese E-Commerce Beyond US in South Korea
In the first quarter of 2023, direct purchases from China in South Korea surpassed purchases from the US for the first time. The total gross merchandise value (GMV) exceeded KRW 3 trillion in 2023. This signals a significant shift in consumer behavior towards Chinese e-commerce platforms.
Temu’s Swift Growth and Expansion into Korea
Temu has experienced rapid growth in transaction volume since last July. Temu’s weekly consumer transaction volume has recently surpassed 50% of Aliexpress’, except for a brief spike during the “100 Billion Festa.”
Increasing Retention Rate of Temu’s Users
Additionally, Temu’s monthly retention rate is increasing, demonstrating its ability to effectively engage and retain customers. The recent establishment of Temu’s Korean subsidiary in early April is expected to solidify its foothold in the market.
Strategic Investments in Korean Market by Temu and AliExpress
Temu is in the process of selecting an official advertising agency on NAVER, while AliExpress plans to invest $1.1 billion in South Korea over three years. Both companies are strategically investing in attracting new customers and enhancing customer loyalty. Aicel’s consumer transaction data provides valuable insights on the evolving consumer landscape and the impact of Chinese e-commerce in South Korea on a weekly basis.
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