Seoul: South Korean retailer Shinsegae Group said Thursday its joint venture (JV) with Alibaba International has received regulatory approval to launch next month. The 50:50 joint company was cleared by the Korea Fair Trade Commission (KFTC) based on self-correction measures related to customer data protection and information management, Shinsegae said in a press release.
According to Yonhap News Agency, the partnership with Alibaba aims to create synergies through a cooperative ecosystem with the global platform and to improve efficiency that will help expand its market share in the domestic online retail market, Shinsegae said in a press release. “This strategic alliance with Alibaba will serve as a gateway for the 600,000 registered sellers on the Gmarket platform to access international markets with about 20 million products within this year,” it added.
The initial target markets include Singapore, Vietnam, Thailand, Malaysia, and the Philippines, where demand for K-pop and Korean products is growing. In the longer term, the JV plans to expand into 200 markets in Europe, South Asia, Latin America, and the United States, where Alibaba already has established sales networks.
Shinsegae’s e-commerce platform Gmarket and Alibaba’s South Korean operation AliExpress Korea have been incorporated into the JV as affiliates, but the two platforms will continue to operate independently, the company said. The JV is expected to bolster competitiveness against domestic e-commerce leaders, such as Coupang Inc. and Naver Corp.
Gmarket is 80.01 percent owned by E-Mart Inc., Shinsegae’s leading discount store chain. Shinsegae acquired Gmarket for 3.44 trillion won (US$2.35 billion) in 2021, but the platform has reported operating losses for three straight years through 2024 amid intensifying competition.