The head of Ticket Monster, South Korea’s No. 3 e-commerce operator by sales, said Tuesday his company is expected to turn a profit in two years by attracting more customers with a better search engine and payment system.
Ticket Monster’s 2015 sales rose 24 percent on-year to 196 billion won ($167.5 million), but it logged an operating loss of 145 billion won due to huge investment in a mobile shopping system and low margin policy. It opened “Super Mart,” which sells daily necessities at the lowest cost possible in the face of cutthroat competition with other e-commerce operators.
“We made massive investment in marketing, the simple payment system and Super Mart in the latter half of 2015,” Shin Hyun-sung, CEO of Ticket Monster, said in an interview with Yonhap News Agency.
The big investment attracted 3 million new subscribers last year, which boosted customer traffic in the first quarter despite a cut in marketing spending, he said.
Talks are currently under way to draw $300 million from investors, Shin said, noting $40 million coming from Korean game developer NHN Entertainment Corp. last month was part of its fund-raising plan.
U.S. investor Kohlberg Kravis Roberts, along with Anchor Equity Partners and Ticket Monster CEO Daniel Shin, in April 2015 acquired a 59 percent stake in Ticket Monster from U.S.-based Groupon.
“We will be able to turn around in 2018. From then on, we will make reinvestments at a level that does not lead to a deficit,”
Shin said, in response to growing concern on the long-term sustainability of money-losing mobile shopping platforms.
The chief executive said the partnership with NHN Entertainment will help improve the mobile platform‘s search engine and payment system, and allow it to use the gaming company’s big data for customized marketing.
The e-commerce platform also plans to develop a one-stop travel booking platform to provide comprehensive tour packages within this year.
While its bigger rival Coupang is pouring money into building its own logistics system and hiring couriers, Ticket Monster said it will efficiently use the exiting delivery infrastructure to give customers a wide range of options from parcel service to convenience store pick-up.
(Yonhap)