Coupang is one of the most successful E-Commerce companies in South Korea. Coupang has accomplished its expansion by always innovating its services and looking for a better customer experience. More recently, Coupang has developed its mobile shopping platforms, same-day deliveries and personalized recommendations services.
Bomseok Kim was born in Seoul, and left Korea at the age of 7 with his father who worked abroad for Hyundai. He eventually attended Harvard.
After Harvard, Kim at first enrolled in the media business. His professional practices were at the New Republic and he then started a “the Current” student magazine. Newsweek bought his initiative a year after Kim graduated in 2000.
In year 2006 Kim raised $4 million for “02138” a Vanity Fair inspired Harvard alumni magazine which didn´t make it through the 2008 world economic crisis. Then, Kim attempted Harvard Business School in 2010 but lasted only a year.
Having studying at Seoul National University prior to his M.B.A. attempt. At that point he knew he “wanted to start something in commerce in Korea”. Groupon’s daily-deal model was the trend and the easiest way to get funded. Kim returned to Seoul and became dedicated to create a Groupon clone to raise money from American investors more easily.
Kim registered Coupang in USA as a ltd. (limited liability corporation) and soon spent almost $1 million on ads. Coupang was Facebook’s top advertiser in South Korea.
Kim’s estimated 19% stake in Coupang is worth $950 million. It seems like he may be a billior soon. This has many people excited, especially in Korea where wealth is usually concertated on the few multi-billion, multi-generational businesses.
The company´s history is quite brief, shorter than 6 years long. It started in 2010 offering daily deals on services, but soon started partnering with dealers, wholesalers and selling physical goods. Now, the company possesses a way larger variety of good to merchandise including home goods and décor, consumables, , sporting goods, electronics, music, books and toys electronics, baby goods, fashion, beauty and many more products. By now, it even possesses travel agency and cultural events tickets.
Coupang was created with the mission of offering goods, products and services. Quickly in 2010 Bomseok Kim founder CEO, saw the company become cash flow positive already at the end of 2011. Also, in the same year, Coupang released an app for Android and for iPhone. And as of May 2012 the company achieved monthly net profit.
Back then, Coupang counted with over 700 employees, with 25,000 signed up merchants selling goods and services on its marketplace and roughly 12 million subscribers. Coupang achieved in the Business Insider’s list “THE DIGITAL 100: The World’s Most Valuable Private Tech Companies” in October 2012. From 2013, its mobile sales boomed and accounted for more than half of the company’s sales. $160 million were raised in May 2014 from Sequoia Capital Global Equities, Greenoaks Capital Management, Sequoia Heritage, Altos Ventures, Rose Park Advisors, Maverick Capital, Clay Christensen, LaunchTime, Bill Ackman, and other U.S. Venture Capitalists Investors.
Last year, In June 2015, Coupang received an investment of $1 billion from Japan’s Softbank.
Coupang quickly achieved growth by: 1) always creating and innovating the services they provide. 2) They are always sure to make a better customer experience 3) they created a high quality mobile shopping platform 4) They offer same-day delivery for many orders and they work on customizing shopping recommendations
In 2016, Coupang has exceeded annual sales of $1 billion US dollars.d
Coupang is the closest thing South Korea has to Amazon and in “several key ways it’s better” says Kim. Coupang and its founder, Kim, are the predominant reasons that Amazon CEO Jeff Bezos will avoid bringing Amazon to the country and its 51 million potential customers; he’s hoping to avoid repeating the China failure.
Coupang’s has its CEO founder Kim seal of drive, effort, intention, emotion and motivation on it. The mentality which Kim feed to his staff is to give more than others, to provide a better product, a better service than other whatever it takes and especially if you have to work more at it, so hours of 80 hours a week are a normal working time for many of Coupang-people. They are truly relentless and fully driven. Thus making it a better service company than its competitors.
Compared to Amazon which is trying to achieve fastest delivery by application of ideas as the use of outside contractors, the experimenting with Uber-like driver networks and even dreaming the idea of using flying drones to improve delivery times to hours. In truth, for Amazon same-day shipments are only available in only 27 metropolitan areas. Coupang manages to do it magnificently country-wide.
The competition is mainly by EBay’s subsidiaries named Gmarket and Auction Co., which also figure along with Coupang as the country´s largest online on demand shopping platform.
What makes Coupang ideal for South Korea, and some countries developing in Asia, is that it does better what Amazon has lingered to achieve. Basically, real time commerce with 24 hours delivery, and a whole well-though scheme of instant gratifications which are the one of the main attraction´s for the customer’s loyalty in which they take high pride. And as a second most important key business strategy, is their effective, their plain Speed, Coupang is already making same-day delivery the industry standard.
At this point the Company employees more than 3600 workers for the delivery of good and services, also possesses modern warehouses which are controlled by their own complicated algorithms, and a large fleet of trucks for their same day distribution.
Another key element which Coupang is doing better service is that you can cancel an order that’s already on its way! Or even change a package’s destination at the last minute. Services still are unavailable in 99% of other competitors, as Amazon. Where Amazon has lingered, Kim has been decisive.
It´s worth to note that while Coupang settled nicely on South Korea, and other countries in Asia, it was not so for oAmazon´s who hasn´t gotten into South Korea but claims he will after he stabilizes his china enterprise. Amazon’s former vice president of operations in China stated once “we were having such a challenge trying to grow in China and the lack of resources available, funds for the large country, that the answer was always: “Not yet, not now”. He now works for Coupang´s Global Strategy.
The reason why South Korea was a good place for Kim to start Coupang- besides the fact that he lived and studied in Seoul when young- was that South Korea has well educated high income population, with a high internet and smartphone penetration, Actually, come to think of it, South Korea was a perfect niche marketplace country for online trade and commerce, in Kim´s words “full of wealthy citizens, ego-driven competitive people, always updated and wired online, and beside a very heavily dense population with over 50 million potential customers. Smartphone penetration and Internet penetration are quite high in South Korea, barely almost everyone has a a smart mobile and a fast internet connection. Also half the population lives in the greater Seoul making delivery logistics lots simpler logistics”.
Last May 2014 Coupang raised a total of $160 million from U.S. Venture Capitalists Investors: Sequoia Capital Global Equities, Greenoaks Capital Management, Sequoia Heritage, Altos Ventures, Rose Park Advisors, Maverick Capital, Clay Christensen, LaunchTime, Bill Ackman, etc. Early thaat year Coupang launched his gold-product the ultra-fast delivery service called “Rocket Delivery”.
Last June 2014 Coupang raised $1 billion at a $5 billion valuation in a round led by Japanese telecom firm SoftBank. SoftBank thinks it can do it again with Coupang. Recently there was a $1.3 billion dollar investment to build more of the already existing 21 warehouses, and improve everything related to infrastructure, logistic, and fleet of trucks for the distribution. These trucks are totally custom made.
The six-year-old startup grossed about $300million in 2015, a figure that will likely quadruple for 2016. Coupang CEO Kim Beom-seok believes the company has enough funds from the attracted investments and now his investors have a firm belief in his Coupang.
Sales for Coupan have seven-fold up to 1.5 US$ billion. Coupang´s marketplace business might be overrun by its retail division in the following years. Euromonitor´s sales information data reported that of every 1.00$ ONE dollar spent online in USA around $0.09 cents were spent online, instead in South Korea this figure is much more relevant it goes up to $0.15 cents of a dollar. The initial focus of Kim might have been the Amazon model, but at the current time he has improved upon it and says his business it´s simply just not fixed to any model or any business plan.
Every new hire by Coupang is given a copy of the Amazon book The Everything Store. He also seems to refer to the teachings of the Great Khan Ghenghis, frequently trying to apply and follow his wisdom, Kim´s reminds us that He ruled the Mongel Empire for a long time, he conquered new lands, and he remarks that the Great Khans´s main ability was to adapt, to adapt his strengths in the battles fought by his armies. In the online world, Coupang is willing to do whatever it takes to win battles to win the customers´ hearts. Kim’s estimated that his 20% ownership share quota in his company as of 2015 it was already roughly above the $1 billion.
So basically through an efficient and culture based loyal service of same-day deliveries, personalized recommendations and improved customer experience Coupang has achieved its consistent growth. They have already been 6 wonderfully successful years and they expect more to follow due to the adaptability and ground-breaking culture the company is already trying to achieve. In Kim words, “The investment will pay off when customers, accustomed to fast delivery speed, order more over time.” ; “We can’t bend the customers to what we want,” says Kim, “but we can bend ourselves to what the customers want.”