Facebook's prospects in Korea

It seems the whole world, certainly its mainstream media, were paying attention to Facebook's IPO yesterday. In the afternoon, as I was driving home from a downtown visit, I received a phone call from a BBC Radio correspondent in London.  He called again upon my return home and we had an interesting conversation and later a short studio interview.  The BBC was interested in how Facebook will fare in Korea, China and some of the other Asian markets where it has limited experience to date but where the growth potential is very large.
One thing that can be said with some certainty is that Facebook is off to a good start in the South Korean market, where social networking via Cyworld's mini-homepages was launched half a decade before Facebook appeared.  In fact, by the time Facebook was launched in the U.S., over a quarter of Korea's population and an estimated 90 percent of those in their twenties were using Cyworld.  Today one can begin to piece together the overall picture by consulting data gathered by different organizations, with different sampling techniques and for different purposes.
As shown in a recent study by Neilsen (koreanclick.com), Facebook has recently overtaken Cyworld's mini-homepy service.  The accompanying graphic (click to see a full size version) shows the trend in share of usage in a direct comparison of Facebook and Cyworld.  Nielsen measures usage rates based on a comparison of unique visitors to both of the social networking sites being compared.    The Nielsen data indicate that usage of Facebook surpassed that of Cyworld early this year.   The Korean language report published by Nielsen notes that the great success of Cyworld in South Korea, especially during the period from 2003 to 2007, established the pattern that Korean consumers depended upon social networking to solve some of their communication problems.  Thus, when Facebook introduced a platform that was open to external sites and users, Korean consumers were ready to switch.
Significantly, the Nielsen report suggests that PC and Mobile (Android) visitors to Facebook totaled more than 15 million people as of April 2012.  (as a point of comparison, www.socialbakers.com suggests that South Korea has only about 7 million Facebook users)  The pie chart from the Nielsen report (click to see a larger version) clearly illustrates the large impact that mobile broadband is having on the use of Facebook, a pattern that extends to other similar social networking services.  Although 58.5 percent of Facebook users in Korea use only PC Facebook, 20.5 percent use Facebook only on mobile devices and another 21 percent (shown in green) use Facebook with both mobile and desktop (PC) devices.
The Nielsen report also shows clearly that young people in their twenties are driving the trend toward greater use of Facebook in Korea.   The 19-29 year old age bracket accounts for 31 percent of all Facebook users in South Korea at this time.

Finally, I thought it would be interesting to consult Google Trends data on the number of visitors to facebook.com compared with visitors to cyworld.com.   The results are shown in the accompanying graphic (click for larger version of graphic).  Note especially that the number of Korean visitors to Facebook starts to increase in late 2010.  It is undoubtedly not a coincidence that Facebook introduced its localized, Korean language service in August of that year.  Google Trends also shows that it was sometime in late 2010 that Korean-language searches for Facebook (or 페이스북, written in hangul) began to increase.
Taken together, the patterns noted in this post bring into clear focus the challenge Facebook will have to ensure long-term success in the South Korean market.   Success will depend upon how well it can localize its services, not simply by translating everything into Korean, but by adapting them to the consumer preferences in the fast-moving and always interesting Korean marketplace.  That was the gist of my argument in a post back in 2010.
Incidentally, if Facebook really wants to thing about larger long-term success, it should begin planning for services that will assist in the reunification of divided families in Korea and ultimately the process of national reunification itself.