Kakao: the new South Korean technological giant!
Founded ten years ago, Kakao messenger (Kakao Corp), a simple mobile messaging operator, has today become one of the most major groups in South Korea. No less than 93% of Korean smartphones are equipped with the KakaoTalk application, i.e. 46 million users out of 52 million inhabitants in South Korea. From there, the Korean giant has been able to create a true ecosystem of services in the lives of Koreans.
The increased prevalence of the term “Kakao Group” in the country’s mainstream media means that Kakao has become a conglomerate much like Samsung Group and Hyundai Motor Group, in size and sphere of influence in Korean society.
Looking at figures provided by the Korea Fair Trade Commission (KFTC), Kakao Corp now has 128 companies under its umbrella, up from 26 affiliated companies in 2014. In terms of market capitalization , Kakao Group is now South Korea’s largest business conglomerate outside of manufacturing.
Kakao, like its American (GAFAM) and Chinese (BATX) counterparts, has made it its mission to improve our daily lives by pre-empting all times of the day. Its slogan reflects this ambition: “Kakao makes a better world with people and technology”.
Since 2015, the Korean giant has been growing with extreme attention day after day as close as possibles of citizen life.
Here are some of its many services:
Created in 2016, the online bank Kakao Bank is valued in August 2021 at nearly 26 billion euros. This is more than the two main Korean historical banking groups KB Financial Group and Shinhan Financial Group.
Kakao Bank has about 13 million active customers to whom it offers accounts and bank cards, savings solutions and personal loans. It plans to expand its product line to offer mortgage and business credit.
Founded in 2014, the financial arm of Kakao Bank has been able to revolutionize mobile payments with its kakao Pay application, which has become the payment method representing 71% of the Korean market where nearly 90% of the population uses an electronic wallet. Unlike in Western countries, payments do not generate much profit, but they are primarily a source of customer data that can be used to refine contextualized service offers or, more concretely, to offer “cross-selling” of credit and savings products and, more recently, insurance. Digital payment marks the beginning of a continuous and long-term customer relationship thanks to the multiple information collected.
KAKAO MOBILITY CORP
After entering the taxi market in 2015, the mobility company quickly broadened its horizons by launching a VTC platform (Kakao Driver), parking (Kakao T’s parking service offers an AI-based parking lot congestion forecasting system, which also analyzes big data to indicate the level of expected congestion at the parking lot. , navigation (Kakao Navi), bus interstate, shuttle, train , air transport and e-bikes. In Korea, no one disputes that Kakao Mobility is now the main pioneer of mobility as a service Mobile as a Service.
Kakao Mobility, which spun off from Kakao Corp in 2017, has now grown into a giant in its own right with more than 30 million users and 18 million bank cards registered.
At the end of last year, Kakao Mobility launched South Korea’s first self-driving vehicle reservation service to a number of users in the city of Sejong. Using the Kakao T app, users can call and reserve self-driving vehicles. Kakao Mobility has partnered with self-driving solution developer Autonomous a2z for this pilot project.
In addition to this partnership, Kakao Mobility has been developing its own autonomous driving technologies since March 2020, when it received preliminary approval from the Ministry of Land, Infrastructure and Transport (MOLIT) for the operation of autonomous vehicles level 4.
The Korean industrial energy giant, GS Caltex, which transforms its service stations by offering various mobility services such as carpooling, drone delivery, electricity charging and hydrogen as well as offers not related to mobility such as catering and convenience store services, has signed an agreement with Kakao Mobility. GS Caltex will use all the data accumulated by Kakao Mobility in future mobility sectors, including autonomous driving, to operate its 2,300 service stations and 370 LPG stations in Korea.
Kakao’s digital healthcare platform, created in early 2022, aims to monitor the health of members on a daily basis using all connected services and objects advocated by Kakao. To support this ambition, Kakao has acquired Humanscape, a Korean medical app developer.
The Korean giant has recently given a strategic priority to investments in the field of content, through production companies and gaming applications, K-Pop, manga, webtoons and metaverses . The “MZ generation”, which brings together millennials and generation Z and accounts for more than a third of the country’s population, represents an extraordinary lever for this leisure activity.
The metaverse and blockchain-based economy will be Kakao Corp’s next growth target. The Korean giant will introduce its metaverse in the Kakao Talk chat application in order to go beyond the existing South Korean digital ecosystem: “beyond Korea and beyond mobile”.
Under the name of “Future Initiative Center”, the Korean giant is therefore preparing to invest new business opportunities related to the metaverse and will bring together its virtual reality, AI, entertainment /content and blockchain present in the various Kakao subsidiaries.
The economic model of the Korean group is similar to that of the platforms of Chinese giants such as Tencent and Alibaba, which have diversified into all our areas of life, and multiply the synergies between their various activities, while benefiting from a base of colossal users!