Shinsegae reshuffles leadership as e-commerce units Gmarket, SSG struggle

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Shinsegae reshuffles leadership as e-commerce units Gmarket, SSG struggle

Published: 19 Jun. 2024, 18:16 Updated: 19 Jun. 2024, 19:01

KIM JU-YEON
kim.juyeon2@joongang.co.kr

Retail giant Shinsegae tapped Chung Hyung-kwon, left, as Gmarket's new CEO and Choi Hoon-hak as the new head of SSG.com. [SHINSEGAE]

Shinsegae has replaced the heads of its struggling e-commerce operators SSG.com and Gmarket, which are losing ground to domestic peers like Coupang and Chinese players AilExpress and Temu.

The Korean retailer tapped Alibaba Korea’s former general manager Chung Hyung-kwon to head Gmarket. SSG.com has majorly slimmed down its business operations, and Choi Hoon-hak, who currently heads its sales division, will take over as CEO, Shinsegae said in a news release Wednesday.

The reshuffle was an effort to achieve rebound growth in e-commerce and to prepare for a logistical shift under Shinsegae's new partnership with CJ Group, according to the company.

Shinsegae's share of the domestic e-commerce market lags behind those of online marketplaces Coupang and Naver; the conglomerate owns 10.1 percent compared to its competitors' respective 24.5 percent and 23.3 percent, as measured by the Fair Trade Commission in 2022.

“We have recognized a desperate need for a new growth engine. The first step we took to build the growth engine is the MOU we signed with CJ Group on June 5,” the retail giant said. “Shinsegae will start its new growth in the online business by replacing key executives in tandem with the reorganization of its logistics platform.”

Shinsegae attributed Choi's promotion to the executive's experience strengthening competitiveness in groceries and logistics.

The change in personnel comes nine months after Kang Heui-seok stepped down as co-CEO of SSG.com in September, leaving Lee In-young as the company's sole chief. SSG.com recorded 103 billion won ($74.5 million) in operating loss in 2023, following consecutive losses of 107.9 billion won and 111.1 billion won in 2021 and 2022, respectively.

SSG.com's four divisions — Data/Infra, sales, marketing and support — have been reduced to D/I and sales. Marketing has been folded into the latter division, and teams categorized under support will now report directly to the CEO. Ahn Jong-hoon — who formerly headed digital transformation at Emart, the offline supermarket unit of Shinsegae — will lead the D/I division.

Chung, who worked as head of Alibaba Korea from 2017 to 2024, served as an executive on Coupang's financial planning and analysis team from 2015 to 2017 and as CEO of Ali Pay’s branches in Korea, Europe and the Middle East.

Chung will oversee the split of Gmarket’s Product eXperience (PX) division into PX and Tech segments. Former Naver employee Kim Jeong-woo will serve as Chief Product Officer of the PX section; the tech side, led by former Coupang director Oh Cham, will be comprised of developers focused on AI.

BY KIM JU-YEON [kim.juyeon2@joongang.co.kr]