According to the watchdog, it fined the e-commerce platform the highest applicable fine and ordered corrective measures for ads run from August 2020 to May 2022 that promoted its "Wow" member prices as cheaper than regular prices while concealing that the discounts were based on a one-time coupon issued when customers signed up for the paid membership.
The KFTC said Coupang began using such deceptive marketing practices in 2020, when paid membership programs among online shopping platforms were taking off. The agency said consumers who sign up for a platform's paid membership are more likely to make repeat purchases, making membership benefits a key factor in attracting and retaining customers.
Coupang initially advertised its member prices as if the discounts were consistently available to paid subscribers, while one-time coupons were offered separately. Later, it began applying a one-time sign-up discount to the advertised member prices, making it appear that the lower prices were a permanent membership benefit and applied more broadly than they actually were.
The KFTC said this may have misled consumers into believing they could repeatedly purchase products at those prices, even though the discounts were available only once. It added that Coupang continued these misleading ads for a long period to attract more members, calling it a serious violation involving the concealment and omission of important information.
KFTC senior official Lee Young-hee estimated that Coupang's membership increased by about 4.5 million during that period, although it was difficult to calculate the ads' direct impact on sales because consumers can sign up for the membership through various channels.
She added, "The current legal cap on fines is low compared with the severity of some violations, which limits the effectiveness of enforcement," vowing that the agency is pursuing revisions to relevant laws including raising the fine ceiling.
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