The World Economic Forum recently posted the below chart showing that 1/5 of all grocery purchases in South Korea are done online. The calculation is e-commerce revenue as a percentage of total fast moving consumer goods revenue in the country.
The explanation they give for this high percentage is that South Korea has some of the fastest and most ubiquitous internet access in the world.
But as soon as I read this I thought to myself: This can’t be the only reason. When was the last time you really wanted to order groceries online but your internet connection was too slow?
Also, if you look at all online shopping (not just FMCG), South Korea no longer shows up as such an outlier. So what’s happening with grocery?
Without actually knowing the market, I would imagine that there are companies in South Korea who have simply figured out how to offer a great online grocery shopping experience.
South Korea is also one of the denser countries in the world at about 513 people per km2. That would help with distribution.
But then again, the Netherlands is also quite dense (414 people per km2). Why are they only at 2.6%? (For comparison, the US is about 33 people per km2.)
If any of you are familiar with the South Korea market I would love to hear from you in the comments. If they really are at 20%, I am surprised more people aren’t talking about this.