Shopper Addiction Spreads to Internet

Mrs. Kim (35) spends on average four hours a day surfing the Internet.

On the Internet shopping malls such as Auction, Gmarket and e-marketplace, she looks around for clothes, cosmetics, electronics goods and so on. If she finds cheap goods or discount coupons, she buys goods on credit right away.

She spends as little as 300,000 won or as much as 500,000 won per month on the Internet.

Most goods she buys that way include clothes, accessories or small electronics goods that she might not have bought if she had not logged on to the Internet. She confessed, “When cheap goods flash on the screen, I cannot help but buy them.”

The more you spend, the better?

There is a growing concern over the addiction to the Internet malls such as Auction and Gmarket. People spend around 2.0 trillion won on the Internet shopping malls a year.

In order to boost sales revenues, Internet shopping malls employ a variety of marketing tactics with coupons, auction, discounts and sweepstakes, prompting people to spend money on the Internet malls.

Ms. Park (27), an office worker, is addicted to sweepstakes.

Even at work she logs on to the Internet to find out goods for sale at auction. She said that she feels a great sense of triumph when she spots cheap but great goods. She recently bought a digital camera at a price which is 30 percent off the lowest offline market price. She has two digital cameras.

Some online shopping malls run “lottery-like” operations with a unique form of auction. Consumers who offer the only price that no one offers are allowed to buy goods. The contract prices are about one tenth of offline market prices. Therefore prices are low. But the catch is that only one person is allowed to buy goods. The rest of the bidders lose 1,000 to 5,000 won in reserve money.

Such malls’ revenues come not from prices of goods but from bidding money.

Coupons are also responsible for addictions to shopping-

Coupons provided by online shopping malls are blamed for the addiction to shopping online. Depending on the frequency of visiting online shopping sites and purchasing prices, consumers are exempted from paying shipping prices or given 5 percent discount coupons or 5,000 won worth of coupons. Such tactics lead consumers to keep buying.

Coupons have the term of validity, which causes consumers to think that failure to buy goods immediately is a loss.

Ms. Oh (21), a university student. said, “Coupons make me think that buying goods right now saves money. When I find coupons I usually surf the Internet shopping malls.”

An online shopping mall holds an event where consumers who draw a winning number are offered reserve money of 5,000 to 50,000 won. To consumers who want to receive the reserve money in cash, the shopping mall sends the money, charging the 10 percent commission fee to the bank accounts.

Marketing tactics that stir up the gambling spirit should be regulated-

A fee-charging members-only service of an online shopping mall is another cause of controversy. The membership fee ranges from 10,000 won per three month to 30,000 won per year.

The shopping mall puts an advertisement that says,” We sell at cost only to members.” In order to recover the cost, the membership fee, people tend to spend too much money online. There is no way for consumers to see whether they get really a good bargain or not.

Yoon Se-chang, professor of Samsung Medical Center said, “Those who are addicted to Internet shopping show symptoms similar to those of alcoholics. The marketing tactics that stir up the gambling sprit need to be regulated.”

Choi Eun-sil, director of the Korea Consumer Protection Board said, “TV home shopping malls are regulated by the Korean Broadcasting Commission, but online shopping malls are not regulated. I will urge related agencies to devise measures.”

cpu@donga.com