Markets these days have been divided into cell-like structures. A large number of one-person entrepreneurs have sold their information and products through social media platforms. Additionally, one-person creators have started to broadcast their own creative contents through live broadcasting systems. Such people are not only known as retailers but also as ‘sell-sumers’, those that generate high demand in their fields as much as other large-scale distributors.
Sell-sumer is a newly-combined compound word combining ‘seller’ and ‘consumer’, referring to those who manage individual markets mainly through social media. The development of individual markets of sell-sumers has led to the division of the distribution market into cells, called the ‘cell market.’ Choi Ji-hye, a Professor at the Consumption Trend Analysis Center of Seoul National University, explained that “Sell-sumers are emerging by the loosened boundary between consumers and producers, as the technology that forms the foundation of the cell market develops.” Currently, the cell-market has expanded to a wide range of fields such as food, fashion, beauty, and more, while also gaining great popularity from consumers.
Different Types of Cell-Markets
In terms of cell-market platforms, they can be divided into three main types. They are the cell markets centered on social media, video contents produced on platforms such as YouTube, and the activity of conventional distribution channels.
Cell-markets based on social media are its most typical form. On this media platform, the sellers trade their products by sharing their daily lives with their consumers. At this point, both social media followers of sellers and other general users are considered as potential buyers in the market. In addition, the more popularity the sellers’ accounts have, the bigger the possibility gets. Word-of-Mouth-Corporation is an example of a cell market which uses online marketing via social media as its product. There is a difference with the general market, in the use of marketing as a product rather than a material product. However, this can be said to be how a typical cell market operates, as a single CEO would start to market through social media with a small capital of 1.5 million won.
One-person creators are the driving force behind cell markets formed through video channels. These creators promote and sell products to the viewers through their own videos. In other words, they are developing cell-markets by expanding the video commerce zone. Jeong Su-yeon, a Junior majoring in Media Communication at Hanyang University, expressed her opinion about the additional role that this kind of market has by saying, “I think video channels such as YouTube are operating not only just as a cell-market itself, but also as to promote other cell markets in other social media platforms.”
Lastly, traditional large-scale distributors are also focusing on the cell-marketsʼ potentials. They look for opportunities to dominate the market by collaborating with other cell-markets. It is also possible for traditional large-scale distributors to utilize a network through cell-markets.
In one case, CJ E&M has created a show called ‘Shock Live’, used only for mobile live broadcasts. It was possible to obtain an increase in the rate of customer inflow by cooperating with influencers at the show. Likewise, the cell-market exists in various forms and has recently grown as a popular market in the Korean distribution industry.
Three Main Factors Behind the Growth of Cell-Markets
There are three main factors that have led to rapid growth in the cell-market in recent years; technological factors, seller factors, and consumer factors.
Firstly, the development of information technology and social media has enabled individuals to open their own markets on the Internet without having big capital, facilities, and a distribution network beforehand. That is, the market environment where platform owners can be the owner of self-labor is made. Also, the growth of non-face-to-face payment systems, such as card payment and smart payment, has widened the space for different markets, allowing trade to be easily done whenever and wherever. In other words, the improvement of technology has lowered the cell-markets’ entry barriers and has loosened the boundary between consumers and sellers.
The fact that sellers can enjoy the promotional effects of low-cost and high efficiency also plays a major role in the cell markets’ growth. Cell markets use a vast and fast network called the Internet. Thus, sellers can promote products to more consumers without using high-priced advertising methods.
Lastly, the cell-market is supported much more by consumers in that it respects the buyers’ personal taste. Cell-markets operated by diverse sell-sumers have their own characteristics. This feature accelerates the growth of cell-markets, closely connecting with cultural diversity that today’s people pursue. Jeong agreed with this by saying, “This is the strength of cell-markets and the reason why they have a possibility to continue as a universal market for the society in the future.”
Merits and Shortcomings of the Cell-Market
Nevertheless, the two sides of the cell-market perform an important role in controlling its estimation. Especially, from the legal point of view, the absence of the consumer protection system causes serious problems.
First, there is a high possibility of illegal trading in the cell-market. The Korean Fair-Trade Commission revealed that about 90,000 of the 50 million portal blogs and Internet cafés have conducted e-commerce transactions in 2016. If social media platforms such as Facebook or Instagram are included, there are tens of thousands of online trading that are taking place. However, the existence of sellers behind these cell-markets in the e-commerce law is very vaguely defined and therefore not held accountable to the law. This is because since most social media sellers are not registered as mail-order entrepreneurs or mail-order intermediaries, they are not subject to the e-commerce protection act or the consumer protection act. Therefore, even though a consumer is damaged from illegal transactions, there is no penalty to the person who causes the crime because of the seller’s obscurity.
Secondly, contents in the cell-market may cause problems such as sexual and general violence. Cell markets tend to attract consumers’ attention by using provocative contents in the oversupplied market competition. This is especially so if a video channel is a cell-market. This may lead to a generation which produces harmful content, and there is a concern that it will spread to the issue of impropriety in the network environment as well as in the distribution market.
Cell-markets have a fatal shortcoming in that their legal system can raise distrust between consumers and sellers. Even so, it is difficult to deny that cell-markets are the attractive market type for not only sellers but also for their consumers.
From a seller’s perspective, the cell market is greatly attractive because the investment costs are low. Cell-markets barely require a cost for web page making and designing like online shopping malls. In addition, the risk of inventory management is also low as it consists of a system that orders according to the number of requests made. So, sellers can easily operate their own business without a heavy financial burden.
Consumers are guaranteed a wider choice of products thanks to the cell-market. And the increase in the number of sellers has created market competition, which has allowed consumers to buy better products at lower prices.
Looking out for Further Developments
Cell-markets can be evaluated positively in that they have revolutionized existing market structures. However, for the cell-market to become a general market overall, its form, components, and related commerce laws need to be clearly defined institutionally. Professor Choi revealed her opinion about cell-markets’ prospects by saying: “I think the cell-market will continue if technological advances are supported, but it remains a question to be seen as to whether changes will take place in the current platform while maintaining its current form.” The cell-market is still in its infant stage. Thus, we need to keep an eye on the continuous and systematic attempts that will be made to improve these cell-markets.