Coway-SK Magic, New Year 'Rental' Battle... 'Smart & Service'

[Asia Economy Reporter Kim Daeseop] Coway and SK Magic are set to engage in fierce competition in the home appliance rental market this year. The "Gyeongja Year Great Battle" between Coway, the top domestic rental market leader under new ownership, and SK Magic, an emerging contender committed to service quality, is drawing attention.

According to industry sources on the 6th, Coway, recently acquired by Netmarble, plans to reaffirm its strength as the number one company in the environmental appliance rental market this year by leading with key products such as water purifiers, air purifiers, and clothing care appliances. The goal is to surpass 8 million rental accounts this year. As of the end of the third quarter last year, Coway recorded a cumulative rental account number of 7.63 million domestically and internationally.

For the water purifier product line, Coway is determined to solidify its position as the number one premium direct water purifier market leader through its strategic product this year, the "Hanppyeom Siru Direct Water Purifier." As of the third quarter last year, water purifier accounts increased by 60% compared to the same period the previous year. This growth is attributed to targeting the market with the "Siru Direct Water Purifier," which was the first to successfully apply reverse osmosis (RO) membrane filters with strong contaminant removal performance to direct water supply.

Coway explains that the Siru Direct Water Purifier is the only premium direct water purifier in the industry that provides fresh direct water while equipped with an RO membrane filter. The core product this year, the Hanppyeom Siru Direct Water Purifier, is an upgraded model that reduces size while enhancing functionality compared to previous versions.

Established in May 1989, Coway is a representative company that first introduced the rental system in the industry in 1998. Netmarble, which acquired Coway, possesses technological capabilities in artificial intelligence (AI), big data, and cloud computing beyond gaming. It is expected that Coway will expand its business into the smart home subscription economy market and globalize through its integration with Netmarble.

CEO Ahn Jiyong of Coway expressed his determination to employees ahead of this new journey, stating, "Even amid upcoming changes, we will focus all our capabilities to continue the right work of protecting customers' health, which we have persistently upheld."

SK Magic plans to accelerate its market approach this year by making 2020 the inaugural year of "service quality innovation." Its rental cumulative target for this year is 3 million accounts. While SK Magic is a traditional powerhouse in kitchen appliances such as gas ranges and dishwashers, it is a latecomer compared to Coway in the rental market for water purifiers and air purifiers.

SK Magic entered the water purifier and air purifier market in 2009. In 2015, it introduced the country's first direct water purifier to the market. Direct water purifiers filter tap water through a filter for immediate consumption. Existing water purifiers that store water in tanks have been criticized for hygiene issues due to potential bacterial or microbial growth.

Thanks to sales of direct water purifiers and others, SK Magic achieved 1.8 million cumulative rental accounts last year. It showed rapid growth by adding 600,000 new accounts last year. Key products include the "All-in-One Direct Water Ice Purifier" and the "Motion Air Purifier."

Among SK Magic's cumulative rental accounts, water purifiers account for 75-80%, the largest share. Among water purifier rentals, direct water types make up 60%. SK Magic claims to hold the number one market share in the entire direct water purifier market.

CEO Ryu Kwonju of SK Magic stated in his New Year's message, "In the rental business, service quality is a core competitive factor that determines the company's fate beyond product quality. We will make 2020 the inaugural year of service quality innovation by establishing a Customer Value Innovation Office and innovating service quality across the entire value chain."

Meanwhile, overseas competition between SK Magic and Coway in the Malaysian market is attracting attention this year. SK Magic's parent company, SK Networks, established a corporation in Malaysia in December 2018 and began selling water purifiers.

Currently, Coway is the market leader in Malaysia's water purifier market. Since entering the local market in 2006, Coway surpassed 1.24 million cumulative rental accounts as of the third quarter last year. Supported by this, the Malaysian corporation's sales also reached a record high of 133.6 billion KRW during the same period.

This content was produced with the assistance of AI translation services.