A New Game in E-commerce: Will the 'Kurly & Naver' Alliance Shake Coupang?

[Korea Financial Times, Park seulgi] The alliance between Kurly and Naver has officially commenced. This comes five months after signing a strategic partnership and forming a joint task force in April. The joint venture, named 'KurlyN Mart', is garnering attention as it combines Kurly's differentiated curation capabilities with Naver's massive customer data. All eyes are now on whether this alliance can trigger a significant shift in the e-commerce market, which has long been dominated by Coupang.

According to industry sources on the 5th, with the launch of Kurly and Naver's joint service 'KurlyN Mart', both companies are showing high expectations. This optimism stems from the belief that synergistic effects will be maximized, given that Naver, as Korea's largest portal site, possesses extensive customer data, while Kurly boasts unique curation capabilities and its own logistics infrastructure.

A Kurly representative stated, "Through the cooperation between the two companies, we anticipate not only attracting new customers who did not previously use Kurly but also expanding the user base of Naver's grocery shopping service. This will lead to an expansion of our product lineup and enhanced competitiveness."
Indeed, with the unveiling of the Kurly-Naver joint venture, predictions of significant changes in the e-commerce industry are gaining traction.

Previously, Naver had signaled a direct confrontation with Coupang by launching its own app, 'Naver Plus Store,' in March this year. However, six months later, industry evaluations suggest that its impact on the market landscape has not been as profound as expected.

An industry official commented, "When Naver launched the Plus Store app, we thought it might be able to compete head-on with Coupang, but it didn't have as much impact as anticipated. This time, their cooperation with Kurly, which possesses logistics infrastructure, means we need to observe how the market will change."

Naver has consistently collaborated with major distribution channels, including E-Mart, Homeplus, and Lotte Mart, as well as convenience stores, and has partnered with CJ Logistics for deliveries. However, it was consistently pointed out that it would be difficult for Naver to become a formidable competitor to Coupang due to its lack of proprietary logistics infrastructure. Nevertheless, this collaboration with Kurly is analyzed as enabling Naver to secure logistics capabilities, making a direct challenge against Coupang now possible.

Another industry insider stated, "Since Naver has collaborated with various distribution channels until now, I'm not sure how much of a threat this encounter with Kurly will pose to Coupang. However, given Naver's powerful membership benefits and Kurly's fresh food competitiveness, the key will be how much influence the resulting customer experience will have on the market."


Kurly is one of the few e-commerce companies that has shown significant performance alongside Coupang in the fiercely competitive e-commerce market. Kurly recorded its first-ever semi-annual operating profit in the first half of this year. Its revenue (consolidated basis) increased by 7.6% from the same period last year to 1.1595 Trillion won, and its operating profit improved by 11.5 billion won, turning to a profit of 3.1 billion won. In the second quarter of this year, revenue grew by 7.4% to 578.7 billion won, and operating profit achieved a surplus of 1.3 billion won. EBITDA for the first half of the year was 16.1 billion won, marking a 106.8% increase year-on-year, driven by comprehensive improvements including revenue growth, logistics productivity efficiency, and profitability enhancement. During the same period, the total Gross Merchandise Volume (GMV) increased by 13.6% to 1.7062 Trillion won.

Naver's commerce revenue for the second quarter of this year reached 861.1 billion won, growing by 19.8% year-on-year. Naver attributed this growth to "the successful establishment of the Naver Plus Store app, enhanced membership and delivery competitiveness, and continuous growth in commerce advertising."

Coupang recorded its highest quarterly revenue ever in the second quarter of this year, at 11.9763 trillion won. Simultaneously, its operating profit turned to a surplus of 209.3 billion won (149 million USD). This amount surpasses the combined revenues of E-Mart and Lotte Shopping, Korea's largest distribution companies.
While Kurly and Naver Commerce are experiencing rapid growth, Coupang's position in the e-commerce industry remains unrivaled.

Kurly and Naver plan to focus on creating synergy by combining digital marketing infrastructure with product expertise in future marketing efforts. Furthermore, with Kurly's logistics subsidiary, Kurly Nextmile, joining the Naver Fulfillment Alliance (NFA) on the 1st, the early morning delivery competitiveness for Naver Smart Store products will also be strengthened.

Sophie Kim, CEO of Kurly, stated, "KurlyN Mart, as a representative grocery shopping platform within Naver Plus Store, will provide a higher level of customer experience by integrating Kurly's curation and dawn delivery services with Naver's technology and marketing capabilities. We expect accelerated company growth through the influx of new customers using Kurly products via Naver and improved logistics efficiency."

Choi Soo-yeon, CEO of Naver, commented, "We anticipate that the combination of Naver's search and personalized recommendation technologies and extensive marketing effects, with Kurly's product sourcing, grocery-specific curation, and delivery capabilities, will offer a new grocery shopping experience. Starting with 'KurlyN Mart,' we will strive to deepen cooperation between both companies in various aspects, including logistics, business, and marketing, to provide even more differentiated experiences for users."

Park seulgi (seulgi@fntimes.com)