A deep dive into Korea’s digital marketing trends and consumer behaviour in 2023

The eventful year of 2022 has ended and the arrival of a hopeful new year has begun.

How has digital marketing changed in the post covid era and what marketing trends will gain attention in the future? In this post, we will analyse the behavioural analysis of Korean consumers in addition to the 2023 digital marketing trends. 

Even after the end of the Covid-19 pandemic, many people’s daily lives are continuing to shift online. The Digital Transformation (DX) movement is still accelerating and helping marketing, the increased use of non-face-to-face services is just one aspect of this.

(Contents)

1. Emerging “Phygital” Advertising

2. The Growth of Short-form Businesses

3. The Evolution of Super Apps

4. The Strengths of Community Services

5. The Analysis of Korean Consumer’s Behaviours

1.  An Exploration into the emerging ‘Phygital Advertising’ trends of 2023

The prolonged pandemic is now being led by digital-oriented online and offline style marketing as it now goes into recovery. This is done while using digital capabilities that have continued to be used since the pandemic begun in 2020.

‘Phygital Advertising’ is one of the best examples of this idea, it means the use of a physical space in marketing and refers to a combination of physical and digital advertising in order to expand costumer experience. In addition to recreating offline customer experiences such as the Ghana Chocolate House pop up store and Musinsa store that opened in Seongsu-dong in April 2022, the uses of recreating offline customer experiences can lead to successful examples of the digitalization of print advertising and phygital marketing, such as Kakao Mobility seating system and Kakao Mobility’s elevator town board.

‘Phygital advertising’ is a technology that integrates online and mobile advertising in an offline environment where data accumulation can be difficult. The integration of online and mobile using technology in an offline environment psychologically engages the customer, allowing them to feel more connected to the brands they interact with offline. This has the advantage of being able to accumulate data and personalize services amid an offline crisis. It is expected that in the future Phygital advertising techniques will be used as a powerful tool for online and offline sales in that it compensates for the shortcomings of purely using online or offline engagement.

• The Growth of Short-form Businesses

The culture of “short form” content, which is led by the MZ generation, encourages consumers to quickly upload and share their desired self-made content in the form of a one minute long video.

Along with the recent increase in shortform distribution channels, the overall age range of consumers is expanding to reach all age groups, and its influence is also on the rise. TikTok, the representative platform of the short content phenomenon, recorded an average of 23.6 hours of usage per consumer over the course of one month. Following this success their rival companies Instagram and YouTube launched Reel’s and Shorts on their respective platforms- which are also dedicated to short from content. In line with this trend, many companies within Korea, such as Naver and Kakao, are paying attention to the production and reach of short form media as they launch their new releases.

Dongwon F&B’s campaign called ‘Tuna vs. Taste’ is a prime example of the rise of short form content. The marketing campaign introduced the processed tuna recipe into the CM song featuring  catchy melodies and lyrics that  became so popular that it led to the company’s largest sales ever recorded. Along with this, Binggeule’s Super cone advertisement featuring Son Heung-min has also became a trend on social media, alluding to shortform content making  a huge shift on  the advertising industry in recent years.

THE CURRENT STATE OF GLOBAL CONTENTS SHORTFORM DEPLOYMENT

Mobile-optimized short-form content is based on a “vertical format”. This format is much more accessible for content creation as it has low access barriers in that it effectively delivers short and brief information that’s optimally viewed on a mobile device. Vertical format media is often more engaging and strong energy than long form, creating an increase in viewer engagement rates and profitability for advertising. Following the launch in the US and UK, TikTok has recently launched its e-commerce platform “Tik Tok Shop” services in four Southeast Asian countries including Thailand, Vietnam, Malaysia, and the Philippines. The appeal of short form media platforms to their users is that they can consume short form content at anytime from anywhere in the world.

• The Evolution of Super Apps

The use of a single mobile or web application, enables access to a variety of daily used services such as messaging, online shopping and financial transactions. ‘Portal application shopper apps’ have been evolving in big tech and many start-up ecosystems during the pandemic. As a result, companies that specialize in specific fields are focusing on expanding their business by implementing a so-called “super app” strategy. Examples of famous ‘Super Apps’ in Korea include ‘The Nation’s Delivery’, ‘Market Kurly’, ‘Carrot Market’ and ‘Shocar’.

Photo sourced from: The Nation’s Delivery

Based on the activity data on Super app users, it is seen as a great advantage to link additional services that encompass commerce, contents and communities, as well as being able to introduce a variety of products and services via an app. Super apps are consistent with platform consumers’ tendencies to use and enjoy as many services on one platform as possible. From this, it is expected that the strategies of Super apps will continue to be used and developed on in the future.

‘Naver Cafe’, a widely used Korean app, recently launched an event for its subscribed members by developing in-app community services based on subscribed user’s interests. This was done by expanding the app’s scope of their original ‘open talk’ feature, which had previously been limited to cater to only sports related coverage. Naver was able to develop on this feature when its popularity with sports interested users exploded during the ‘2022 Qatar World Cup’. The next generation of community ‘open talk’ services will include ‘Dramas’ and ‘Security Issue Keywords’. By developing community services based on subscribed user’s interests, Naver can then use user’s interests to connect with major businesses and events.

Recently, app’s community services have become an important means of identifying consumer interests and have become the core of digital marketing strategies beyond the role of social media to support interaction and form new social networks. Community services and related marketing services will soon be more important than ever in that they can build a wide profit model by linking communities and people with common interests. It’s been analysed that the importance of community services and related marketing will soon be greater than ever as it can continue to grow as a way for communication and experience to be used between brands and its users.

5. The Analysis of Korean Consumer’s Behaviours

1. The importance of customer experience (CX)

According to Infob’s ‘How APAC Consumers Have Impact the CX agenda’ investigation into their consumers based in Asia, the importance of strategic hybrid customer experience (CX) design showed that there was a surge in consumer’s responses during the pandemic period. The survey also showed that when compared to traditional telephone counselling and visits to service centres, consumer preferences also began to include telephone counselling (55%) automated chatbots (38%) and online live chatting (34%). The survey also recorded a higher preference for automation and convenience services than ever before eluding that it is now time to focus on building automated services in order to build a hybrid experience for customers.

• Building Digital Trust

Last October, the ‘Kakao’s’ app had a malfunction that caused multiple damages to the messaging app’s users. It is estimated to have affected approximately 47.5 million users and delayed various services such as daily conversations, business services and finances. As Korean consumers are accustomed to using digital services throughout their lives such as Internet financial banking services, mobility, payment, and messenger shopping, etc. digital disasters can lead to a decline in customer loyalty.  App’s long-term relationships with customers depends on how companies can work to secure and maintain their data. Data maintenance such as cybersecurity and data information protection are crucial to building digital trust as it plays a key role in maintaining customer loyalty.

• Cherry-sumer

With the start of 2023, when a severe economic recession is anticipated, the so-called consumer cherry-sumer is expected to emerge. Cherry Sumer, which is a consumption strategy to purchase limited resources at a minimum amount, is derived from Cherry Picker, which means that it only takes benefits without purchasing them. Cherry Sumer has recently begun to emerge as a low-cost buyer seeking extreme utility for worsening consumer sentiment, as mentioned in the writer, Kim Nan-do’s ‘Trend Korea 2023’. The increase in small-capacity and small-packaging consumption in supermarkets is an example of marketing aimed at cherry sumers. As a result, convenience stores and large supermarkets are introducing foods such as vegetables and meat that are less subdivided into 1-2 meals, and the travel industry is also introducing the lowest-priced products in order to be more cost-effective.

Through this post, we hope you will be able to grasp marketing trends from a digital perspective and analyse the behavioural analysis of Korean consumers to make it more beneficial for your own business.