South Korean online luxury fashion platform Catch Fashion, famous for its commercials featuring actor Jo In-sung, closed its operations on March 19, just over five years after its launch in 2019.
Before closing its business, Catch Fashion informed its customers, “Due to unavoidable managerial circumstances, we have decided to suspend the operation of Catch Fashion services,” adding, “All services will be terminated as of March 19.” Most of the employees have reportedly left the company.
Catch Fashion, founded by CEO Lee Woo-chang in 2019, surpassed a cumulative transaction amount of 80 billion won just two years after its launch and secured around 38 billion won in cumulative investment funds by 2021. It ranked fourth in market share, following Musinsa, Trenbe, and Balaan.
Unlike competing platforms that directly stock and sell luxury goods, Catch Fashion differentiated itself by partnering with 40 official distributors of global luxury companies, such as Matches Fashion and Net-a-Porter, integrating their sales channels to compare product prices and facilitate direct overseas purchases.
Following the end of the coronavirus pandemic, the platform’s performance deteriorated, making it difficult to attract additional investment, ultimately leading to the shutdown of services.
The industry suggests that the decline of online luxury platforms began as the “pent-up demand” that had surged during the pandemic started to wane.
The trend is already evident abroad. Matches Fashion, a British luxury retailer known for starting as a boutique in London in 1987 before going online in 2007, is set to shut down. Despite being acquired by the U.K.’s Frasers Group for about 85 billion won last December, the company has been unable to overcome its financial challenges and is currently undergoing bankruptcy proceedings.
Similarly, Farfetch, another British luxury retailer, was acquired by the South Korean e-commerce giant Coupang for about 650 billion won in the same month. Farfetch once boasted a market capitalization of 34 trillion won, becoming the world’s leading luxury platform.
