Is 'Timeth' Merger the Solution?... Even Combining Four Subsidiaries under Qoo10 Remains 'Unpromising'

"Merging TMON and WEMAKEPRICE and rapidly restructuring to create a profitable structure" is the "only way" to resolve the current settlement delay crisis, according to Koo Young-bae, CEO of Qoo10. However, even if time is gained and this plan is pursued as he envisions, the problem is expected to be difficult to solve. The loss of trust has severely damaged the competitiveness of TMON and WEMAKEPRICE as e-commerce platforms in a short period. Moreover, as a result of this crisis, the previously normal operations of Interpark Shopping and AK Mall have also faced the reality of settlement delays. Foot traffic to Qoo10’s e-commerce platforms has sharply declined, making it difficult to create a profitable structure to solve the problem even if all are merged.

On the 1st, data company IGAWorks reported through Mobile Index that on the 28th of last month, the daily active users (DAU) of TMON and WEMAKEPRICE were 436,000 and 290,000 respectively. Considering that the figures on July 1st, before the large-scale settlement delay damage surfaced, were 1,213,000 and 822,000, both companies lost more than 64% of their users in less than a month.

DAU represents the number of people who visited the platform at least once a day. Since the 28th was the day consumers flocked to TMON and WEMAKEPRICE for refunds, many of the remaining users are likely victims who purchased through the platforms before the crisis and are trying to understand the situation. In effect, the platforms have ceased functioning as e-commerce services. Currently, both TMON and WEMAKEPRICE state, "The app is operational, but depending on the partner’s situation, delivery may be delayed, impossible, or payment canceled," and warn, "Please be especially cautious as you may experience inconvenience during refunds if orders are canceled."

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The settlement delay crisis has spread to Interpark Commerce as well. AK Mall announced, "Interpark Shopping, Interpark Books, and AK Mall, operated by Interpark Commerce, have not received sales proceeds due to the TMEP settlement delay impact, and some electronic payment gateway (PG) companies’ withholding of payment has caused delays in sales proceeds settlement." Unlike TMEP’s monthly settlement cycle, Interpark Commerce operates a weekly settlement system every Monday. Some PG companies and simple payment services have withheld Interpark Commerce’s sales proceeds, causing cash flow issues and failure to pay settlement amounts to some sellers.

Judging that the damage to value is severe, the industry has quickly moved to "cut losses." Interpark Triple, a Yanolja affiliate, notified Interpark Commerce to terminate the brand usage contract and stop using the ‘Interpark’ brand. Interpark Triple had sold Interpark Commerce, which split its shopping and book businesses in April last year, to Qoo10. Subsequently, links to the shopping and book sections operated by Interpark Commerce were removed from the integrated Interpark website and app.

In this situation, even if TMON and WEMAKEPRICE merge as CEO Koo envisions, and even if Interpark Shopping and AK Mall are added, the industry evaluates that creating a profitable structure will be difficult. According to the Fair Trade Commission, TMON and WEMAKEPRICE’s market share was 8%, based on 2022 when both platforms were still operating normally. However, this year, the emergence of so-called ‘C-commerce’ platforms like Ali and Temu has added a new variable. As of June, before the crisis, both had twice as many users as TMON and WEMAKEPRICE. While C-commerce is rapidly growing, TMON and WEMAKEPRICE’s trust has plummeted due to the settlement delay crisis. An industry insider said, "CEO Koo might have thought that merging TMON and WEMAKEPRICE could regain the previous 8% market share, but that is too detached from reality."

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