Record fine on Coupang raises questions about online retail practices


The Fair Trade Commission's decision to levy a historic fine of 140 billion won ($102 million) on Coupang has ignited discussions on the role of online retailers in South Korea. Coupang, known as a major online retailer facilitating transactions between sellers and buyers, also operates as a seller on its own platform, offering products under its own brand. The company was penalized by the antitrust watchdog for manipulating search rankings and engaging its employees to write reviews promoting its private label items. The FTC emphasized Coupang's 'dual role' as a crucial factor in the case, while Coupang defended its actions by asserting that the dual role wasn't a cause for concern. The FTC revealed that Coupang artificially boosted around 64,250 of its products to the top of search rankings by manipulating algorithms and utilizing employee-generated purchase reviews over a four-and-a-half-year period. There is also debate on whether Coupang's private label products truly benefit small and medium-sized manufacturers and contribute to a positive market cycle. Coupang's assertion that restrictions on their Rocket Delivery products might lead to a reduction or cessation of the service has faced criticism, with some consumers viewing it as a threat and a potential undermining of Coupang's main competitive advantage.


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