Coupang is a rapidly growing e-commerce company in South Korea, a country that boasts an ingrained shopping culture and high smartphone penetration. It began as a Groupon-style daily deals business, but it quickly became an eBay-like platform. Its founder, Bom Kim, scrapped a planned IPO and transformed it into what it is today.
Its customers can order anything they want from the Coupang website or app, and their items are delivered to their doorsteps within 12 hours, 99% of the time. That’s incredibly fast, and it’s helped the company rack up millions of active customers in less than three years.
That rapid growth has been fueled by Coupang’s innovative technology and operational practices, which allow it to offer possible prices on a large assortment of products with the flexibility to deliver them to customers in a way that’s most convenient for them. The company has also built a network of fulfillment centers in various cities across the country, so it’s able to service a vast customer base in a single region.
In addition to its e-commerce services, Coupang is also trying to diversify into food and grocery delivery. It’s partnering with major grocery chains in the country to make it easier for its customers to find and buy what they need.
As a result of its expansion into the food and grocery space, Coupang has seen positive adjusted EBITDA for the first time in a few years. And it has a robust balance sheet, with cash and cash equivalents of $3.1 billion.
The company’s leadership team includes a mix of former employees from companies such as Naver, Amazon and Uber. Managing director Ben Sun has been instrumental in helping the company build a solid team.
He’s also been a key contributor in recruiting top talent from outside the company. He’s worked with a number of venture capital firms to bring in the best leaders from different parts of the world.
Some of these people may be hired on a day-to-day basis and others will work on short-term contracts. The flexibility allows Coupang to match its labor costs to the ebbs and flows of the business.
That agility has allowed the company to become one of the fastest-growing e-commerce businesses in the world. Its growth is fuelled by a combination of aggressive marketing and the indirect network effects between sellers and consumers.
Its unique brand and a commitment to making its e-commerce experience more convenient than traditional retail has drawn customers away from brick-and-mortar retailers and into Coupang’s online store. It’s also a leader in fintech, with its own e-payment system and a “buy now, pay later” scheme.
While the company is currently focused on e-commerce in South Korea, it’s also looking to expand into Japan and Taiwan. These countries have a similar set of characteristics to South Korea and are both densely populated.
In Japan, Coupang is trying to compete against Rakuten and Amazon. In Taiwan, it’s competing with Shopee and Lazada.