South Korea - Country Commercial Guide

Describes what a company needs to know to take advantage of e-commerce in the local market and covers prominent B2B websites.

Last published date: 2021-08-14

E-commerce is a key component of the overall consumer market in Korea and is consistently growing.  Korea is a connected country; almost 99.5 percent of Korean households have internet access via PC, mobile, or another device. 

Characteristics of e-commerce in Korea include:

  • Domestic online purchases reached $136.5 billion in 2020 up from $116.0 billion in 2019. High penetration of smartphones is the main factor driving market growth. Purchases on mobile phones increased from $74.8 billion in 2019 to $92.1 billion in 2022.
  • The most popular products sourced from domestic online retailers in 2020 are food & beverages (12.4 percent), home appliances & electronics (11.8 percent), food service (10.9 percent), clothing (9.5 percent), household items (9.0 percent), cosmetics (7.7 percent),  and travel & transportation services (5.1 percent).
  • Cross border e-Commerce continues to increase because Koreans find less expensive prices from overseas even after adding-in international shipping fees and import duties. Cross border e-commerce has reached $3.5 billion in 2020.
  • Under the KORUS FTA, express courier service mailed goods under $200 are duty free when sourced from the U.S., and ‘made in the USA’ items under $1,000 are exempt from KORUS FTA documentation.
  • Multi-brand online retailers such as and eBay are the most frequently used foreign online shopping sites visited by Koreans. 
  • According to Korean Statistical Information Service (KOSIS), the most popular foreign sourced products from online retailers by Koreans in 2020 were apparel & fashion items (40.1 percent), food & beverages (24.5 percent), electronics (9.4 percent), and household goods and car accessories (5.5 percent).
  • Following the implementation of Korea’s privacy for personal data in 2014, Korea Customs continues to push importers of record to clear shipments with a Customs Clearance Indigenous Code (CCIC), a Korea Customs-issued ID number, rather than a national ID number. 
  • U.S. based e-commerce companies should review the Personal Information Protection Act (PIPA) and ministerial data privacy/spam regulations, which may restrict e-commerce for firms managing user-data on international servers. The most recently amended PIPA was implemented in August 2020,

Internet Penetration                                                                                                                 

According to Ministry of Science and ICT, in 2020, Korea had over 46 million internet users representing 91.9 percent of the total population. In April 2019, Korea became one of the first countries to launch commercial 5G network services nationwide. Thanks to its 5G networks, Korea ranks first in the world for mobile connection speed according to the Speedtest Global Index, April 2020. With the domestic mobile carriers’ aggressive promotion along with the government pressure on expanding 5G infrastructure, as of January 2021, South Korea had 12.87 million subscribers in the 5G segment.

Current Market Trends                                                                                           

E-commerce is leading the growth of the Korean retail market. While e-commerce is rapidly growing, traditional retailing channels are suffering. Consumers tend to go to traditional stores for window shopping but turn to online retail sites to find the best deals and make the purchase.  One of the biggest trends in online retailing is convergence with other platforms. Internet portal sites, social network services, TV home shopping, etc. now all have online shopping functions and the popularity of their platforms are increasing since consumers want a one-stop shopping experience that includes product reviews and price, purchasing, and paying with new online payment solutions associated with the platforms. 

Domestic E-commerce (B2C)                                                                                  

Domestic e-commerce sales have been increasing for the past few years and became the biggest retail channel in Korea. Popular e-commerce sites include Naver Shopping, Coupang, Auction, G-market, and 11st. Naver Shopping was ranked as the top e-commerce site in 2020 (combined mobile and PC users).

Cross Border E-commerce                                                                                                     

Online purchases from foreign retail sites reached $3.5 billion in 2020, up from $3.1 billion in 2019, with 44.5 percent purchases originating from U.S online retailers. Although in 2020, the United States was ranked number one, the EU and China are expanding their presence in the Korean cross border e-commerce market.  

Business to Business (B2B) E-commerce                                                                                                            

Korean B2B e-commerce market data is not available; however, due to the explosive expansion of business to consumer (B2C) e-commerce and tough competition among e-commerce players, e-commerce companies are looking to expand into B2B e-commerce on consumable sales to small and medium size companies. In 2012, G-market was the first one to launch a B2B shopping site called “Biz on.” Auction also has B2B sites called “Biz club” for food ingredients and “Biz plus” for other consumables. Interpark has “I market Korea” that integrates B2B and B2C services. We Make Price started “We Make Price Bizmall” in 2016. With 6.3 million small and medium-sized companies registered in Korea in 2019, the B2B e-commerce market is expected to be very competitive.

E-commerce Services                                                                                 

In 2020, food & beverages were the most popular items sold through Korean e-commerce platforms, representing 12.4 percent of the total e-commerce sales. Food delivery orders increased by 76 percent amid the COVID-19 pandemic representing 10.8 percent of the total e-commerce sales. 

E-commerce Intellectual Property Rights                                                             

It is illegal to sell counterfeited products on e-commerce sites and to bring any counterfeit goods into Korea via cross border e-commerce. Korea Customs Service (KCS) prohibits any counterfeited goods to be brought into the country.  In 2019, the KCS seized $567 million worth counterfeit goods, some of which were sourced by cross border e-commerce, entering the Korean market.

Business to Government (B2G) E-commerce                                                                                                     

For B2G E-commerce, Korea Online E-procurement System (KONEPS) is the only channel in Korea. In 2020, 69,964 public organizations of buyers and 624,860 providers were registered on this system with a total volume of business at $95.5 billion. The site dealt with 76 percent of Korea’s public procurement market in 2019.

Online Payment

According to a survey by the Bank of Korea, the most preferred payment method for customers using personal computers (PC) and mobile platforms is by credit card. With the continuous growth of online shopping, electronic payment services via PC and mobile are increasing.  For Payment Gateway (PG) service based on credit cards, the average number of usages a day exceeded 16 million, and the amount of total payments reached $628 billion in 2020.  In addition, mobile payment & digital wallet service such as Samsung Pay and Naver Pay are attracting more users.  In 2020, on average 14.5 million cases per day were paid by smart pay services and the total sales amount to $393 billion.

Mobile E-commerce                                                                                                                 

Mobile e-commerce is the main driver of the explosive e-commerce growth. While online shopping grew by 19.1 percent in 2020, mobile e-commerce increased by 24.5 percent. Purchases from mobile platforms make up 70.5 percent of the total e-commerce market value.

Digital Marketing

In 2020, the size of the online advertisement market was estimated at $6.5. billion, up from $5.5 billion in 2019 according to Korea OnlineAd Association.  In 2020, the online advertisement is the biggest advertisement channel occupying 51 percent of the total advertisement market in Korea. As to each online advertising channel, the sales amount of mobile had been constantly taking up personal computers (PC)’s market share. Mobile accounted for 76 percent of the market in 2020 up from 71 percent in 2019. Among online advertisement types, pay-per-click search ads make up 42 percent, display ads make up 38 percent and video ads make up 20 percent. While pay-per-click search ads grew by 7.4 percent in 2020, display ads and video ads grew by 31.7 percent and 31.4 percent respectively.

Major Buying Holidays                                                                                            

Seollal (Lunar New Year’s Day- Winter), Children’s Day (May 5th), Parents’ Day (May 8th), and Chu-seok (Fall - the 15th day of the 8th lunar month), are major buying holidays in Korea. When purchasing from foreign online shopping sites, Koreans also follow foreign countries’ buying holidays such as China’s Singles’ Day (November 11- Guanggun Jie) and Black Friday in the U.S. (Day after Thanksgiving) to get the best deals.

Social Media                                                                                                                             

According to a 2021 study by Mobile Index, the most widely used social media in Korea is Band followed by Instagram. Band had 161 million users in 2020 down from 164 million in 2019, and Instagram had 118 million users up from 99 million.  Utilizing social media is considered an important marketing channel as consumers go to social media sources for information before making buying decisions.


Of the $3.5 billion spent by Korean consumers for cross border e-Commerce in 2020, $1.5 billion was purchased from the United States. According the Korea Customs Service, dietary supplements, apparel, and food products are the most popularly sourced items from U.S. while cosmetics and electronics are sourced more from the E.U. and China than from the U.S.       

Trade Shows      

CS Korea was not able to identify any trade shows focusing on e-commerce. CS Korea does have an extensive list of Korean retail trade shows, which can be obtained upon request. However, most of these trade shows tend to be B2C instead of B2B.

Key Contacts

  • Ministry of Trade, Industry and Energy (MOTIE)
  • Ministry of Strategy and Finance (MOSF)
  • Korea Customs Service (KCS)  

Local Contact

Ms. Jinjoo Lee
Commercial Specialist
Commercial Service Korea
U.S. Embassy Seoul
188 Sejong-daero, Jongno-gu
Seoul 03141, Korea
Tel: 82-2-397-4324