KakaoTalk, a 3-year-and-change-old Korean messaging app, has eclipsed Facebook’s popularity in South Korea and Japan. The company leverages its simple, all-under-one-roof social media infrastructure and immersive, visual communication strategy––enhanced by digital content like custom themes and emoticons––to hook users.
KakaoTalk has made great strides in the battle against other Asian messaging heavyweights Line and WeChat for the hearts of users, gaining 50 million in the past year and bringing its total active user base up to 100 million, as of July 2013.
Already ubiquitous in South Korea, it seems Kakao’s gaining momentum to go global. And as Western markets lose patience with cluttered Facebook Newsfeeds, Eastern apps like those of Kakao, with their straightforward, integrated chat and sharing platforms, will have the chance to to seize shares of the social media pie.
Many are optimistic KakaoTalk will succeed in capturing the attention of America’s masses of smartphone users. The app brings to Western messaging markets two things currently missing: an alternative commercial model and a way to house multiple social platforms under one roof. Where U.S. users have Facebooks, Instagrams, Vines and Bellys, South Koreans have Kakao accounts.
Born in 2010, KakaoTalk was bred for mobile. Series A investments by firms like Maverick Capital and Cyberagent, with later funding by TenCent Holdings, Ltd. and WeMade Entertainment (who plugged $81 million into the company in April 2012) brought total funding to $103 million by May 2012, according to a Kakao Rep. Through KakaoTalk, users can make free international calls, share photos and video, send and buy brand products, and compete to beat friends at popular mobile games. Within the app, shortcuts to KakaoStory (similar to Instagram) make jumping from interface to interface to share and connect across multiple platforms simple.
Digital content sales and the incorporation of ads into game-playing are integral to monetizing Kakao’s model. The company also gets paid to lead users to sponsored content––content those same users often seek out themselves by adding brands as friends.
KakaoTalk’s 2012 numbers showed $45 million in revenue and $7 million in profits, while Kakao the company was valued at $454 million as of May 2012. Yet while fully ninety-five percent of South Korean smartphone users have KakaoTalk, many of those in Western markets are unaware the umbrella platform even exists.
This may soon change, however, as KakaoTalk has ventured boldly where Facebook has gone, and failed, before. Their attempt to integrate KakaoTalk with Android smartphones’ DNA, KakaoHome, attracted 1 million downloads in two weeks. While the innovation remains confined to its South Korean base for now, its potential for global growth is generating buzz. Together with KakaoTalk’s desktop launch, this step will help to heighten the company’s international profile and to solidify its reputation as a global tech powerhouse.
When asked by Red Herring about future plans, KakaoTalk rep Sonia Im talks about their vision for a far off future. “In the long run, we hope to expand not just our messenger application KakaoTalk, but also our entire platform,” says Im of the Kakao communication team in an e-mail. “Through continued effort, Kakao intends to grow into a platform that helps users from all around the globe discover and enjoy quality content, thereby securing position as a favorite mobile social platform provider at a global level.”
For now, though, the company itself has no designs to go west.
“As for Kakao’s plans in western markets, as a small company with limited resources, we have not been able to make an aggressive entrance into any western markets including the US,” Im says. “Consequently, we don’t have anything to share in terms of specific strategies for the western market.”
KakaoTalk is a 2012 Red Herring Asia award-winning company.