By Yoon Sung-won
The annual turnover of Kakao’s mobile gift service has exceeded 1 trillion won for the first time, the company said Wednesday.
With its mobile e-commerce business continuing to grow in recent years, Kakao is expected to speed up introduction of more diverse profit models tapping into the dominance of its mobile messenger service Kakao Talk.
“Kakao Talk’s gift service has continued to grow since its release as the mobile platform’s first profit model, creating a new culture of gift-giving here,” Kakao’s commerce business head Son Dong-ik said.
The gift feature was launched in December 2010 as a Kakao Talk add-on service. Users can purchase products, services and coupons on a mobile shopping channel embedded in the messenger app and gift them to others. With this system, users can give a gift to others even when they don’t have an address to send it to.
The service instantly drew popularity among mobile users here, largely thanks to the massive user base of the messenger app in Korea. Kakao Talk currently has more than 40 million active user accounts.
“Our service differentiates itself from other online commerce features as it is tailored to allow people to give presents to other users,” a Kakao official said. “With high accessibility and an easy-to-use interface, the gift service has drawn more consumers in recent years.”
According to Kakao, more than 17 million Kakao Talk users have taken advantage of the gift service at least once this year. About 80 percent of them have sent gifts to those on their friend lists.
Kakao also said consumers have used the mobile gift service particularly during holidays and anniversaries such as Valentine’s Day, Christmas and the day of the national university entrance exam. The turnover also rose during Chuseok and the Lunar New Year holidays.
When the service debuted seven years ago, only 15 vendors teamed up with Kakao to sell their goods and services on the mobile platform. But the number now reaches 4,000.
Kakao’s commerce business is growing fast under the leadership of its CEO Rim Ji-hoon this year, becoming one of the two biggest income sources of the company alongside its content business.
According to its regulatory filing released last month, Kakao posted 58.3 billion won in sales in the third quarter, up 43 percent from a year ago.