Coupang's weekly active users, which had fallen sharply after a personal data leak, are showing signs of recovery this month. As Coupang moves to strengthen the lock-in effect of its Wow Membership by changing the free-shipping threshold for non-members, some analysts say acting CEO Harold Rogers' dawn-delivery stint is having a positive impact. Attention is on whether this leads to improved performance, relations with the government and a recovery in consumer trust.

Industry officials said on March 24 that Coupang's weekly user count came in at more than 28 million. MobileIndex from IGAWorks, covering Android and iOS, put the number of users from March 9 to 15 at 28,281,963. That is close to 29,080,952, the level recorded immediately after the large-scale personal data leak, suggesting Coupang's user metrics are entering a recovery phase.

A change in Coupang's user base was previously confirmed in the fourth quarter of last year. That quarter included the date the data leak was announced, and Coupang's operating profit for the period fell 97 percent from a year earlier. Some analysts said the so-called "Tal-pang" movement, meaning quitting Coupang and boycotting it, was confirmed in actual indicators.

A Coupang Inc report submitted to the U.S. Securities and Exchange Commission showed fourth-quarter consolidated operating profit of 11.5 billion won ($8 million), down 97 percent from a year earlier. Active customers, defined as those who used Coupang at least once in the fourth quarter, stood at 24.6 million, down 100,000 from 24.7 million in the third quarter. Coupang analyzed that the fallout from the data leak had a negative impact on sales growth, active customers and profitability indicators including Wow Membership.

In mid-March, the difference between the weekly user figure and the level immediately after the data leak narrowed to 798,989, easing the decline and showing signs of a rebound.

Coupang's user recovery is seen as reflecting a lock-in effect, a barrier that makes it difficult to switch after starting to use a particular service. Analysts say its strategy to prevent cancellations and encourage reuse among members of its paid Wow Membership was effective. Wow Membership provides benefits within Coupang's vertical platforms, including free Rocket Delivery shipping, streaming service Coupang Play and free delivery on delivery app Coupang Eats, in return for a subscription fee.

Coupang first issued purchase vouchers worth up to 50,000 won per person to all registered customers on Jan. 15. The coupons could be used on Coupang, Coupang Eats, R.LUX and Coupang Travel. Industry officials said daily active users rose from around 15.99 million on Jan. 15, the day the coupons were issued, to 16.38 million the next day. This is seen as more likely to have temporarily curbed user departures than to have had a long-term effect. Given that Coupang is closely tied to daily life, analysts say the move also sought to drive repeat purchases by customers considering leaving the membership.

Coupang is also showing signs it plans to strengthen Wow Membership's lock-in effect. From mid-next month, Coupang will change the free-shipping threshold for users without Wow Membership to be based on the "final amount paid". Non-members will need to exceed 19,800 won in the actual amount paid, excluding discount benefits, to receive free shipping.

Coupang explained the move as a measure to block some sellers from inflating prices to meet the free-shipping threshold through loopholes. But some in the industry also see it as strengthening Wow Membership benefits. They interpret it as a move to differentiate between paid members and non-members and encourage membership conversion in the long term.

As a rebound in user numbers is detected, expectations are also returning on performance. Coupang forecast in a results conference call last month that first-quarter revenue would grow 5 to 10 percent. Gaurav Anand (거랍 아난드), CFO of Coupang Inc, said in the call, "The growth rate of the product commerce division (Korea Rocket Delivery, Rocket Fresh and others), which fell to the 4 percent range in January, showed improvement from February," and mentioned that total first-quarter revenue would grow 5 to 10 percent on a constant-currency basis.

A shift in the external climate is also being sensed after acting Coupang CEO Rogers took part in a dawn-delivery stint on March 19. Rogers and Democratic Party lawmaker Yeom Tae-young (염태영) spent about 10 hours from the night of March 19 to the early morning of March 20 in an area of Jungwon-gu, Seongnam, Gyeonggi Province, experiencing the entire routine work process of dawn-delivery drivers.

The dawn-delivery stint followed Yeom's suggestion to Rogers at a National Assembly hearing in December that they try late-night delivery work together. With a sharp atmosphere surrounding Coupang, including hearings, after the customer data leak, Rogers' fulfillment of the promise is seen as a move with an eye on improving relations with the government.

After the dawn deliveries, Rogers said, "I am proud of all workers at Coupang workplaces, and I will do my best to create safe and advanced working conditions going forward," drawing interest in whether the move could become an opportunity to restore consumer trust.

An industry official said, "After the customer data leak, concerns were high about users leaving, but the recent WAU trend shows that Coupang's Wow Membership lock-in effect is still working," adding, "The key going forward is whether the recovery in user indicators leads to actual improvements in sales and profitability."