South Korean Ecommerce Company Makes its Public Debut
Coupang’s First Trading Day
Yesterday, South Korean ecommerce company Coupang (CPNG) made its debut on the New York Stock Exchange. The company’s shares began trading at $59.60—a 70% increase from its initial public offering price of $35.
The company’s name is a blend of the English word “coupon” and the Korean sound for hitting the jackpot, “pang.” Coupang’s market share has grown during the COVID-19 pandemic to hit 24.6% in 2020, which is up from 18.1% in 2019.
Coupang’s Growth Over the Past Year
The company has made big investments in infrastructure to make its customer experience as seamless as possible. For example, customers who belong to Coupang’s membership service can return items simply by leaving them outside their doors without a box or return label.
“Our mission is to create a world where customers wonder ‘How did I ever live without Coupang?’” explained the company’s founder, Bom Suk Kim.
Comparisons to Amazon and Alibaba
Coupang is often compared to Amazon (AMZN) in the US and Alibaba (BABA) in China. Both of these ecommerce giants saw significant growth after going public. Consumer markets in the US and in China are significantly larger than they are in South Korea. Coupang will not have as much room to grow domestically as Amazon and Alibaba, but it could still be poised for significant expansion.
The South Korean ecommerce market had an estimated value of $90.1 billion in 2020 with an annual growth rate of 22.3%. The country’s population is about 52 million with the vast majority of people living in dense urban areas. South Korea had a robust delivery culture long before ecommerce became widespread, with customers ordering food and other services over the phone. For this reason, analysts expect that many of the ecommerce trends taking place during the pandemic will be here to stay.
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