South Korea is at the forefront of technological development with some of the world’s fastest and most extensive networks, making this country ideal for future digital commerce growth opportunities. In fact, South Korea is the most digitally connected population today based on Euromonitor International’s Digital Connectivity Index , placing it just ahead of tech-savvy neighbors like Singapore and Japan .
South Korea is strong in fixed and mobile broadband connectivity, and the nation’s connectivity is buoyed by its near-ubiquitous household broadband. The country’s high-tech culture is unsurpassed, with 99% of the population using broadband connections. Unlike other markets, South Korea has a highly developed telecom environment with a small digital divide.
At the beginning of 2016, the nation’s mobile operators acquired additional spectrum frequencies to invest in increasing network speeds. It is working toward the deployment of 5G technology ahead of the 2018 Winter Olympics, and is expanding the use of “internet of things” technology across a variety of sectors. Operators and equipment manufacturers are working toward the commercial deployment of 5G services.
With extensive infrastructure and fast connection speeds, it has a highly developed telecom environment, which will mute expansion rates in the forecast period. Even so, this Asian tech giant has created an ideal backbone in which to support future digital commerce opportunities. Online grocery and travel bookings are expected to be top areas for such growth moving forward.
Already South Korea has become a leading online grocery market as the long-held tradition of visiting supermarkets declines in popularity. In 2015, 10% of all groceries were bought online with one-third of all rice, pasta and noodles and 45% of all baby food sold online. This highlights the disruptive impact online could have on food sales and forces manufacturers to come to grips with the next-era of grocery shopping. Unlike markets with similar demographics, South Korea’s online grocery market has benefited from an aggressive marketing and merchandising strategy for selling food online. Homeplus, the market’s second largest grocery retailer, has targeted city workers with “scan and buy” virtual stores located in subway stations. These shelves emulate in-store experiences, but are more convenient.
The South Korean travel industry is also rapidly growing more digital . Although online travel agencies and other intermediaries are leading the digital trend in travel, direct suppliers have also focused their attention toward the online channel as they look to attract more consumers and generate more profits. For example, airline operators, especially low-cost carriers, are actively developing customized products and selling them through these digital channels. In fact, of the top three categories for greatest absolute value growth across all of commerce, two are rooted in travel (direct airline bookings and online travel agencies).
In fact, South Korea ranks only behind the U.K. on the Digital Consumer Index, which measures the interplay of digital connectivity and digital commerce potential. In fact, South Koreans are some of the most digitally savvy consumers worldwide. Already four-fifths of the connected population reported having made a purchase for a good or service via a mobile phone, according to Euromonitor International’s 2016 Global Consumer Trends Survey. This equates to estimated 12% of all consumer payments in 2016 being executed through a device, according to the latest data from Euromonitor International. This ratio is projected to reach 22% by 2021 as South Koreans become more comfortable with both browsing and buying a wider variety of goods and services online.
This article was written by Michelle Evans from Forbes and was legally licensed through the NewsCred publisher network.