Welcome to our first episode of our Asian Beat series!In this first issue we investigate the current state of the South Korean mobile games market. In particular, we look at the history of messaging app Kakao Talk as well as the reasons behind its incredible success. We also dive into the game trends, which have been rapidly evolving over the past couple of years.To begin with, a few facts and figures:
One of the World’s hottest mobile games markets
According to the Korea Creative Content Agency (government agency in charge of promoting the content industry), the total South Korean games market already amounted to $9.16 billion in 2012 and the revenue for the domestic mobile gaming market reached $754 million during the same year.
The country is also extremely tech-savvy. Smartphone penetration in South Korea had already hit 70 percent by the end of 2013 (according to a South Korean government report), which is significantly higher than some Western countries, such as the UK (62 percent), or the US (56 percent). One specificity of the South Korean market is that Android is by far the dominant operating system, with an install base close to 94 percent. It is, after all, Samsung’s home turf.
N.B.: the install base represents the percentage of devices owned at a given point in time (snapshot), whereas the market share is the percentage of devices shipped over a given period of time – usually a quarter (trend).
Mobile games are also extremely popular and widespread among the population: as early as 2012, approximately 61 percent of South Korean users with smartphones played mobile games, and South Koreans spent on average one hour a day playing mobile games. (Source: Korea Creative Content Agency).
Given that games represent 37 percent of all app downloads and 92 percent of revenue among the Top 400 Grossing apps in the Play Store worldwide (source: Distimo), these figures are far from negligible.
Kakao’s dominance within the Korean mobile gaming scene
Mobile gaming became even more popular in Korea in the Summer of 2012, when “over-the-top” (OTT) messaging service Kakao launched their game publishing service. Where Kakao was originally simply a social networking service providing instant free text messaging and call services, the new platform suddenly started enabling developers to easily publish and distribute their games to millions of Kakao users.
Match-4 game “Anipang for Kakao” was the first game to become a national hit, with many other publishers following in its footsteps to publish their titles on Kakao. Games flooded onto the platform and, with Kakao driving massive installs, many of them managed to climb the top charts in Google Play and the App Store and enjoyed increased revenue on top of this. Within a year of its release, the platform had hit 30 million users and generated 400 million game downloads.
The mobile games market continued to expand extremely fast and, after further success of titles such as Moddo Marble (모두의 마블), Every Town (에브리타운), Wind Runner (윈드러너) and Pokopang (포코팡), the competition became very intense. At this point bigger, traditional online game publishers, such as Nexon, NHN, CJ E&M and WeMade also joined the race. Currently, over 450 games have been released on the Kakao platform, and an average of 4 new titles get released every week.
One of the key elements of Kakao’s success is its propensity to generate virality, as it is first and foremost a messaging service and a social platform with over 100 million South Korean users. Kakao’s social features play a great part in the visibility it generates for its featured games. In particular, the social invite functionality is instrumental to the virality of the titles published on the platform.
Here is for instance the screenshot of a game invite for Anipang on Kakao:
Key Milestones in Kakao’s development (source: beSUCCESS)
March 2010: Kakao Talk Launched by Kakao Corp.
August 2011: Series A investment from Maverick Capital and Cyber Agent Ventures
March 2012: Kakao releases Kakao Story, which bacame the most popular social networking service in Korea. It still has more Korean users than Facebook.
July 2012: Kakao releases its first game, Anipang, which becomes an immediate sensation in Korea.
August 2012: Kakao hits 55M users, 50 percent of whom are Korean.
December 2012: Kakao passes 70M users, more than 50 percent of whom are now outside Korea.
2012: Kakao’s first profitable year, following successful launch of their games platform
February 2013: Kakao releases its games platform on iOS
May 2013: Series B funding raised from Tencent
June 2013: Kakao CEO, Sirgoo Lee, outlines his vision of the Future of mobile platforms
July 2013: Kakao passes 100M global downloads
September 2013: Kakao releases Angry Birds on its platform, their first overseas title
October 2013: Kakao releases it’s music streaming service and achieves 2M downloads in 4 days
- February 2014: Kakao Corp. announces date of IPO
Changing game trends
Tendencies and preferences among gamers evolve rapidly. When the Kakao platform launched early 2012, casual games were the most popular type among South Korean gamers. Later that year, trading card (TCG) games such as Million Arthur grew to be the most successful genre. Right now, it is mid-core games with RPG elements which are topping the charts.Interestingly, today’s top titles mainly consist of local games with high-end graphics on top of core RPG elements, and are generally published by large South Korean players, whereas global hits such as Clash of Clans and Puzzle & Dragons usually only manage to reach the middle of Top 25 charts.
Understanding the background and trends of mobile games market in South Korea is just the start. Next you’ll need insights on how to successfully publish and market your game.
To learn how to localize your publishing and marketing efforts in South Korea, read the next Asian Beat, where we’ll be diving into how exactly you can succeed in the South Korean mobile gaming space.Stay tuned!Authors:
Boyoun is Marketing Manager APAC and is responsible for developing and implementing the marketing strategy across the APAC market. Prior to joining AppLift, Boyoun worked as Online Marketing Manager at Google Korea.Boyoun holds a Master’s degree with honors in Social Science from London School of Economics and is a big fan of all Batman movies.
Jun is a dedicated expert in mobile game performance marketing with a focus on the APAC region. As Senior Business Development Manager Asia for AppLift, Jun is working with +100 game companies to acquire users for their free 2 Play games.Jun graduated with a Master’s Degree in Digital Strategy from HEC Paris and TELECOM Paristech. Jun speaks fluent French and has watched Amélie over 25 times.
As Account Manager Asia, Pilsoo is building up the APAC business for AppLift by working with Asian game publishers and media partners. Before joining AppLift, Pilsoo worked as a starting member of InnoGames Korea.His highest score in Flappy Bird goes over 150.To make sure not to miss the next Asian Beat as well as the rest of AppLift’s insights, subscribe to our newsletter trough the form below:[yks-mailchimp-list id=”b97ff5c6cc”]