Online cross-border shopping declines as won falls

An office worker in Korea recently changed her mind about buying leggings directly from a shop in Canada. Instead, she made her purchase from an online shopping mall in Korea.

The product costs $60 if bought from Canada, which is equivalent to around 78,000 won ($59.5) as the won is trading at about 1,300 to the dollar. The purchaser would have paid around 68,000 won last year, as the won was 1,100 to the dollar.

“I bought the same product at 85,000 won at a local online shopping mall,” said the office worker.

“The price is much cheaper when considering international shipping and since I can use discount coupons at the Korean online marketplace. Deliveries are much faster, too.”

As the dollar appreciates against the local currency, fewer consumers in Korea are going for cross-border shopping. Instead, they are turning to domestic online malls. Japanese online marketplaces are another popular choice due to the depreciation of the yen.

Cross-border purchases dropped 16.1 percent in the second quarter to 1.3 trillion won compared to the previous year, according to Statistics Korea on Wednesday.

The figure has been declining since the fourth quarter of last year.

International shopping dropped 1.4 percent on year in the first half among BC card holders. Purchases from shops in the United States dropped the most, by 18.3 percent.

Purchases made by Korean consumers at Japanese online shopping malls surged 31.1 percent on year in the second quarter to 103.8 billion won.

“Consumers making cross-border purchases are sensitive to price changes according to the currency,” said a spokesperson for BC Card.

“More people are shopping at domestic and Japanese online shopping malls as the dollar sharply appreciates.”

BY SOHN HAE-YONG [cho.jungwoo1@joongang.co.kr]