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Curtis File 'Macro-level guiding principles for entering the Asian Market in terms of which countries to target first' Latis Global_newest
1. Which Asian Market Suits You?
Macro-level guiding principles
for entering the Asian market
Curtis File
E: curtis.file@latisglobal.com
T:@CurtisFile
W: game.latisglobal.com
B: blog.latisglobal.com
2. 10 years
100 people (35 in Game Division)
Agency Services:
• Publisher connection
• Localization
• Marketing
• Customer support
• Community management
• Testing
Our Company
14. Market Factors: Tech Infrastructure
Country 4G Coverage Average
Download Speeds
Comparison to
World Average
91% 18 MB/S +66%
68%
11 MB/S +28%
Major Cities Only 2-4 MB/S (non-4G
speeds) -52%
Source: [1] Open Signal (http://opensignal.com/)
16. Market Factors: Purchasing Power
Country Average Monthly
Income (USD)
Data Package Cost
(USD)
Portion of
Income
~$2, 903 Unlimited $70-$80 2.75%
~$2,522 Unlimited $70-$80 3.17%
~$700 5GB $100 14.28%
Source: [1] International Labor Organization
(http://www.ilo.org/global/research/global-reports/global-wage-report/2012/lang--en/index.htm
Latis has been involved in Korea’s game industry for 10 years.
Worked mostly in MMO localization in the past.
Presently we act as a game agency for the mobile market handling, localization, testing, QA, and marketing – either through ourselves or one of our partners.
We’ve also been a big advocate for indie games in Korea and fostering a better indie culture in Korea.
China is the White wale of the mobile market
lives in ambiguous territory
we don’t have a full picture of it because of store fragmentation
Developers want to conquer it
King of the ocean
Home to the Best IP in the business
doing well in Japan earns you a kind of street cred
if you do well in Japan you probably have a much better chance at doing very well in the rest of Asia
Korea comes in third at best
Poorly understood potential (those who know about it, see it, but there isn’t much out there attracting people to the market)
usually ignored
With that in mind, a lot of young companies want to enter the Asian market, with little idea of where to start, so I get asked this question frequently.
Today, I’m going to answer it this question by challenging the prevailing thinking and hopefully help you better understand Korea as an entry point into Asia.
I am going to look at three macro-level guiding principals, give you a bit of data to support this idea, and hopefully you will walk away with a new perspective
Joe Fresh, Nike, L’Oreal, Hollywood have all used Korea as a test market in this way
Provides right demographic (young-middle aged)
Small enough with ~50 million people, half of which live in Seoul, with an average income around $35,000
Use it to iterate their products before going into the rest of Asia. I think the game industry can do this too.
Joe Fresh, Nike, L’Oreal, Hollywood have all used Korea as a test market in this way
Provides right demographic (young-middle aged)
Small enough with ~50 million people, half of which live in Seoul, with an average income around $35,000
Use it to iterate their products before going into the rest of Asia. I think the game industry can do this too.
Joe Fresh, Nike, L’Oreal, Hollywood have all used Korea as a test market in this way
Provides right demographic (young-middle aged)
Small enough with ~50 million people, half of which live in Seoul, with an average income around $35,000
Use it to iterate their products before going into the rest of Asia. I think the game industry can do this too.
First guiding principal I want to talk about is ease of business.
Basically, all of the things that make doing business in a country easy, whether its language, legality, licensing, or other cultural factors.
Korea is one of the top 10 countries in the world bank’s EOBI
includes factors like: regulations, access to/ease of procuring facilities and utilities, ease of procuring, protecting investors, paying taxes, enforcing contracts, starting a business, entrepreneurship, transparency.
These are all factors that I find are not really thought of before going into a country, but after the fact they become readily apparent issues.
Korea out ranks both Japan and China in English proficiency
it might seem like a marginal difference, but it is well-known that you will probably need a partner in any of these three countries. You are more likely to have access to someone that understands you in Korea than in China or Japan.
Perhaps more importantly this comes down to an issue of cultural-open-ness
the American presence has had a profound impact on shaping Korean pop culture, particularly over the last 25 years. This is most notable in music and film, but the same translates over to games
there is more understanding and acceptance the Western perspective in Korea than China or Japan
This means even before you decide to localize, there may already be a small base of people who know about you.
Japan and Korea both have incredible networks and relatively cheap data compared to the rest of the world
able to do this because of their relatively small geographics
Korea still has the greatest smartphone penetration and is considered the one of the worlds first saturated smartphone markets
China, on the other hand, suffers from a relatively underdeveloped network
not an LTE country, 22% 3G penetration
This ultimate means that Korea makes for a great starting point because you can do all of your testing for the bigger markets here.
Samsung i
Japan and Korea both have incredible networks and relatively cheap data compared to the rest of the world
able to do this because of their relatively small geographics
Korea still has the greatest smartphone penetration and is considered the one of the worlds first saturated smartphone markets
China, on the other hand, suffers from a relatively underdeveloped network
not an LTE country, 22% 3G penetration
BUT: Samsung leads the way with 18% of the marketshare
This ultimate means that Korea makes for a great starting point because you can do all of your testing for the bigger markets here, both for infrastructure and device testing.
Japan and Korea both have incredible networks and relatively cheap data compared to the rest of the world
able to do this because of their relatively small geographics
Korea still has the greatest smartphone penetration and is considered the one of the worlds first saturated smartphone markets
China, on the other hand, suffers from a relatively underdeveloped network
not an LTE country, 22% 3G penetration
BUT: Samsung leads the way with 18% of the marketshare
This ultimate means that Korea makes for a great starting point because you can do all of your testing for the bigger markets here, both for infrastructure and device testing.
Japan and Korea both have incredible networks and relatively cheap data compared to the rest of the world
China, on the other hand... game sizes have to be small in order to accommodate the price plans and affordability
http://www.tradingeconomics.com/
Japan and Korea both have incredible networks and relatively cheap data compared to the rest of the world
China, on the other hand... game sizes have to be small in order to accommodate the price plans and affordability
http://www.tradingeconomics.com/
Offline marketing is important in all three markets but to different extents
Korea: Subway billboard advertising is important, with some television ads supporting them here and there (anecdotally: I see them more in movie theaters than on television)
Japan: Television ad spending is driving a lot more sales. At one point Gree was spending as much as 90% of its marketing budget in Japan on Television ads.
China offline advertising is important too, (billboard)
Offline marketing is important in all three markets but to different extents
Korea: Subway billboard advertising is important, with some television ads supporting them here and there (anecdotally: I see them more in movie theaters than on television)
Japan: Television ad spending is driving a lot more sales. At one point Gree was spending as much as 90% of its marketing budget in Japan on Television ads.
China offline advertising is important too, (billboard)
In Korea you have the advantage of only needing to focus your attention on 1 city.
nearly half the population lives in Seoul and it’s surrounding province, Gyeonggi-do
allows you to do more highly targeted offline campaigns. If you win Seoul, you will be able to win the rest of the country almost entirely by word of mouth or the social loops in your games
Because of this, budgets are smaller
both Japan and China are bigger and more fragmented so they require bigger budgets and a more thorough understanding
Lunar new year
White day
Chuseok/Tsukimi
Childrens day
Buddhism
Shared fairy tales
Lunar new year
White day
Chuseok/Tsukimi
Childrens day
Buddhism
Shared fairy tales
Lunar new year
White day
Chuseok/Tsukimi
Childrens day
Buddhism
Shared fairy tales
China Historically:
exerted its influence through the simple fact that it dominated so much of the area. China still has a legacy of influence over the ASEAN countries, BUT the frequent small tensions that rise up do mean that some people look elsewhere
Japan Historically:
In the Cold War era, for example, that was Japan.
They invested in SEA n particular, exported their food, fasion, films, etc.
They used Soap Operas depicting Japan as Asia’s center for a refined lifestyle – and it worked.
targeted younger generations with mange and cartoons
Korea now:
beginning in the late 90s, Korea started to subvert Japanese influence.
K-Dramas became popular in China in 1999, and by early 2000s had spread to Hong Kong, Taiwan, Japan, SEA, North Africa, South America
K-dramas lead into K-pop and the Hallyu wave has been in full swing since the mid 2000s
In South East Asia, Korea currently has more cultural currency than Japan.
I can speak to this anecdotally in a number of ways, but the one that stands out the most is in Myanmar. I was there on vacation and was visiting a very small town in the center of the country and a young girl, maybe 15 or 16 years old, was speaking to me in better Korean than English as she was trying to sell me little souveniers.
Now, perhaps more importantly for us here, we are seeing some of that impact on a much smaller scale within the Western world
This tells us that only is Korea going to be increasingly more open to Western content, but the reverse is also true, where Korean content and culture can do well in the West, even if it is currently on a comparatively small scale.
China Historically:
exerted its influence through the simple fact that it dominated so much of the area. China still has a legacy of influence over the ASEAN countries, BUT the frequent small tensions that rise up do mean that some people look elsewhere
Japan Historically:
In the Cold War era, for example, that was Japan.
They invested in SEA n particular, exported their food, fasion, films, etc.
They used Soap Operas depicting Japan as Asia’s center for a refined lifestyle – and it worked.
targeted younger generations with mange and cartoons
Korea now:
beginning in the late 90s, Korea started to subvert Japanese influence.
K-Dramas became popular in China in 1999, and by early 2000s had spread to Hong Kong, Taiwan, Japan, SEA, North Africa, South America
K-dramas lead into K-pop and the Hallyu wave has been in full swing since the mid 2000s
In South East Asia, Korea currently has more cultural currency than Japan.
I can speak to this anecdotally in a number of ways, but the one that stands out the most is in Myanmar. I was there on vacation and was visiting a very small town in the center of the country and a young girl, maybe 15 or 16 years old, was speaking to me in better Korean than English as she was trying to sell me little souveniers.
Now, perhaps more importantly for us here, we are seeing some of that impact on a much smaller scale within the Western world
This tells us that only is Korea going to be increasingly more open to Western content, but the reverse is also true, where Korean content and culture can do well in the West, even if it is currently on a comparatively small scale.
Korea, China, and Japan are big, independent markets.
Korea shares enough similarities with the two giants at its side to merit using it as a testing grounds before launching into either of them
There is less risk in Korea due to smaller budgets and less fragmentation than the other two, while still being a top 5 app market
Korea:
Similar with Japan in technological capability and mobile infrastructure
Samsung leading China in Smartphone market
Similar advertising strategies required in all three (i.e. offline, broadcast, billboard)
More influence in ASEAN countries
Smaller marketing budgets
No significant app market fragmentation
Similar to Japan in that they are driving Google Play revenue
Shared cultural backgrounds