Coupang Eats Sparks Controversy with Free Delivery Expansion, Reversing Fee Cut Plans

Coupang Eats has ignited a firestorm of controversy by announcing the expansion of its free delivery service to all members, a move that directly contradicts a proposed fee reduction plan discussed within a social dialogue body aimed at fostering fair practices. This decision has drawn sharp criticism from political circles and industry players, who argue that Coupang Eats has undermined the collaborative process and is instead pursuing aggressive promotional tactics that further entrench user reliance on its platform.

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Coupang Eats' free delivery is a 'poisonous prescription' that passes costs onto merchants and is merely a promotional event to secure members.

The company stated that the temporary promotion, extending free delivery to non-Wow members until August, is part of an initiative to stimulate consumption during a period of high inflation. However, this narrative has been strongly refuted by the Euljiro Committee of the Democratic Party, which hosted the dialogue. They assert that Coupang Eats is misrepresenting the facts, as the free delivery expansion was never formally discussed at the negotiation table. The committee highlighted that Coupang Eats initially proposed a temporary 1.5 percentage point reduction in intermediary fees for mid-tier merchants as a 'mutual growth plan' but later withdrew it, replacing it with the current free delivery offer.

The fallout from this about-face has led to the indefinite postponement of the second round of social dialogue meetings. The Euljiro Committee has condemned Coupang Eats' actions as a "poisonous prescription" that shifts costs onto merchants and serves merely as a customer acquisition strategy. They argue that while the delivery fee may appear to be zero, the actual costs are being transferred to merchants, ultimately leading to increased food prices and a dual pricing structure that disadvantages consumers.

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The free delivery is not free; the costs will ultimately be passed on to merchants and consumers through price increases.

Concerns about market monopolization are also mounting. Industry insiders worry that Coupang Eats' aggressive expansion, fueled by its existing membership base, could further consolidate its dominance in the delivery market. This could pave the way for future increases in fees and advertising costs, with the burden inevitably falling back on merchants. The move also raises questions of fairness for existing Wow members who pay a subscription fee for similar benefits. Calls are intensifying for regulatory intervention, with demands for a swift investigation and decisive action against Coupang Eats' alleged monopolistic practices and unfair trade behaviors.

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Coupang's expansion of free delivery to general members will further deepen market dependency.