"Bought for a Special Price, but Cheaper Today"... Online Malls Caught Inflating Discount Rates by Raising Regular Prices

Online Shopping Malls Caught Inflating Regular Prices and Using Fake Time-Limited Discounts
Consumer Agency and Fair Trade Commission to Overhaul Online Discount Advertising Practices

The Korea Consumer Agency and the Fair Trade Commission have recommended that four major domestic online shopping malls be required to provide clear explanations of the "regular price"—the standard price before discounts—and to clearly distinguish between general discounts available to everyone and the maximum discount available under specific conditions. The authorities also called for improvements to make it easier for consumers to check the conditions for applying discount coupons.

The Korea Consumer Agency announced on the 19th that a total of 606 consumer inquiries related to online shopping mall price discount advertisements were received at the 1372 Consumer Counseling Center over the past four years, from 2022 to 2025. By year, there were 144 cases in 2022, 150 in 2023, 132 in 2024, and 180 in 2025.

Gmarket image. Gmarket

The Korea Consumer Agency investigated the actual state of price discount advertisements for 1,335 products listed on four major online shopping malls in Korea: Coupang, Naver, Gmarket, and 11th Street. The investigation covered 800 Lunar New Year gift set items and 535 time-limited discount products. The results revealed that, for some items, the regular price was inflated to exaggerate the discount rate or that products were sold at the same or even lower prices after the time-limited discount period ended.

According to the current "Notice on the Types and Standards for Unfair Labeling and Advertising Practices," raising the regular price to exaggerate the discount rate constitutes unfair labeling and advertising.

An analysis of the regular price changes before and after the discount event for 800 Lunar New Year gift set items that participated in discount promotions during the last holiday period showed that 12.8% (102 items) had their regular prices raised during the discount period, exaggerating the discount rate. In particular, 2.0% (16 items) had their regular prices inflated to more than twice the pre-promotion level, and some items saw increases of more than three times.

By shopping mall, Coupang had the highest rate at 23.0%, followed by Naver at 13.0%, Gmarket at 9.0%, and 11th Street at 6.0%.

According to the Online Dark Pattern Voluntary Management Guidelines, businesses must not falsely inform consumers that discounts or benefits are subject to time restrictions. In particular, it is often problematic when products are advertised as being available at a discount for a limited time, but then continue to be sold at the same price.

An analysis of price changes for 535 products offered as time-limited discounts in January found that 20.2% (108 items) maintained the same or even lower prices after the promotion ended. Among them, 17.9% (96 items) kept the same price the day after the promotion, and 2.2% (12 items) saw prices drop. Even seven days after the promotion ended, 12.0% (64 items) were still being sold at the promotional price, and 1.5% (8 items) were being sold at an even lower price.

Coupang Center. Photo by Yonhap News

By shopping mall, Naver had the highest rate at 37.0%, followed by 11th Street at 35.4%, Gmarket at 14.3%, and Coupang at 2.2%.

Since the sellers are the ones who set product prices, legal responsibility for unfair labeling and advertising fundamentally lies with them. However, the Korea Consumer Agency and the Fair Trade Commission explained that platforms also have an obligation to cooperate in preventing legal violations by sellers.

Based on the results of this investigation, the Fair Trade Commission and the Korea Consumer Agency held the first and second business meetings with the Korea Online Shopping Association and the four major online shopping malls. These meetings were held on March 18 and April 10. After gathering industry opinions, both agencies recommended improvements to how price discounts are displayed.

During the meetings, it was pointed out that the long-standing practice of incorrect regular price labeling in the online market has led to relatively low awareness and compliance among sellers. Accordingly, rather than immediately imposing sanctions on sellers, the agencies decided to first improve the product information input and display systems at the platform level to encourage voluntary compliance by sellers.

11th Street Image. 11th Street

Specifically, to prevent arbitrary adjustments of regular prices to exaggerate discount rates, online shopping malls were advised to add detailed explanations of the regular price to each product detail page. Sellers were also required to see explanations about regular prices and warnings that false or exaggerated labeling could result in legal liability when registering their products.

Additionally, discount rates should be displayed based on the general discount available to all, and if a conditional discount that requires certain criteria is shown, those conditions must be clearly stated nearby. This measure is intended to allow consumers to distinguish clearly between the minimum and maximum discount rates applicable to them.

Regarding the issuance of discount coupons, improvements were recommended to make it easier to check key information, such as validity periods and usage conditions. Furthermore, platforms were encouraged to strengthen self-monitoring to promptly identify and address unfair labeling and advertising, and to distribute and educate sellers on the Online Dark Pattern Voluntary Management Guidelines to encourage voluntary compliance.

All four online shopping malls accepted the recommendations for improving how price discounts are displayed and submitted implementation plans after the two rounds of business meetings.

The Fair Trade Commission stated that it plans to immediately encourage voluntary corrections by sellers found to have possible legal violations in this survey. The agency also announced it will impose strict sanctions if the same or similar practices are repeated in the future.

The Korea Consumer Agency and the Fair Trade Commission expect that these measures will improve practices regarding the display of prices and discount rates, which are crucial to consumers' purchase decisions, and help reduce consumer misunderstandings.

The agencies emphasized that, as major platforms are working to prevent legal violations by improving their systems, sellers must also provide accurate regular prices and discount rates based on objective evidence. They also advised consumers to check average selling prices and price trends through price comparison sites before making purchases.

The Korea Consumer Agency stated, "In cooperation with the Fair Trade Commission, we will continue to monitor the state of discount pricing in online shopping malls before and after large-scale sales events. If any false or exaggerated labeling is found, we will promptly take corrective action to create a trading environment in which consumers can make rational choices based on accurate information."

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