Coupang own brand search engine rigging
Updated: April 2022
South Korean e-commerce company Coupang is under investigation by the country's Fair Trade Commission (FTC) for allegedly manipulating its search engine algorithms in favour of its own label products.
The investigation comes hard on the heels of an on-the-spot inspection at the company's Seoul headquarters in Seoul following complaints by customers, civic groups and others that it had abused its market position by favouring its own brands products over those of third parties.
The Financial Times notes that tampering with algorithms is common in South Korea’s e-commerce sector.
Pattern of manipulation and coercion
In August 2021, Coupang was fined 3.29 billion won (USD $2.81 million) for forcing hundreds of sellers to reduce the prices of their goods sold on its platform and increase them on rival platforms. It was also found to have unfairly coerced suppliers into purchasing adverts on its platform.
Coupang and its subsidiary CPLB are also under investigation by the FTC for getting its employees to submit positive reviews of its own brand products.
Meanwhile, the company's food delivery subsidiary Coupang Eats and its star rating system have drawn fire for mishandling a complaint that resulted in the death of a restaurant owner.
An earlier FTC investigation found Korea's dominant search engine Naver had been manipulating its e-commerce and retail search engines in favour of its own brands.
Country: S Korea
Sector: Technology; Retail
Purpose: Rank content/search results
Technology: Search engine algorithm
Issue: Competition/price fixing
Opacity: Governance; Black box; Marketing