Coupang to increase membership fees by 58%

Coupang has decided to raise the price of its Wow paid membership service to 7,890 won ($5.74) per month, up 58 percent from the current 4,990 won, in an effort to improve profitability, but the abrupt price hike announcement has drawn criticism from users who think it is excessive, according to industry officials, Friday.The nation’s top e-commerce company announced the membership price increase, Friday, saying it “will continue to expand its exclusive benefits for Wow members such as free shipping, free returns, unlimited OTT (over-the-top) service and free food delivery.”The company said new subscribers will be required to pay the increased price from Saturday and the price hike will also be applied to existing users from their August payment.Given Coupang added it will keep investing in expanding its logistics infrastructure and advancing its technologies and nationwide delivery network, the move is also interpreted as an attempt to bolster profitability in preparation for the onslaught of rapidly growing Chinese e-commerce companies such as AliExpress in the Korean market.Coupang launched the membership program in 2018, offering members benefits such as fast delivery that guarantees delivery by the next day and free returns.The company has expanded the scope of benefits to free viewing of its Coupang Play video streaming service and free delivery for its Coupang Eats food delivery service. With such benefits, the company garnered around 14 million paying members as of the end of 2023.However, many users expressed dissatisfaction with the price hike announcement after only two years and four months, saying that the company raised the price after it thought the membership service was on track.

“Raising the price gradually from 2,900 won to 4,990 won and then again to 7,890 won makes me feel uncomfortable with the membership. I’ve been using the membership conveniently, but I’m skeptical whether I should continue to use the service because I think they will continue to raise the price in the future,” a user, who claimed to be a member, wrote in an online community.Another user questioned the company’s motives for raising the price two days after the country’s April 10 general elections.”I think they were waiting for the general elections to end. If Coupang raises prices like this, I wonder if other consumer goods sectors will also raise prices,” a user wrote in another online community.Coupang claimed that its price hike was not significant, claiming that Wow membership would save millions of members about 970,000 won a year, and that millions of Wow members actually save about 1 million won a year.Coupang also provided a price comparison example, claiming that its video streaming service Coupang Play is cheaper than competitors such as Netflix, Tving, YouTube Premium and Disney+.“New members of Coupang’s Wow membership will likely see more discounts in the future. Based on data from major organizations such as Statistics Korea, and assuming consumers’ typical spending patterns, it is estimated that Wow members who routinely use all five services, including free shipping, returns, direct purchases, OTT and food delivery, can save an average of 970,000 won per year compared to non-members,” a company official said.”We’ll continue to surprise our customers with benefits that make Wow Membership the 스포츠토토존 best service on the planet.”