Google’s struggle to maintain their position in Korean market is a prime example of foreign corporations unable to penetrate the walls that surround the peninsula.  What are Google’s competitors such as Naver and Daum doing differently from Google?

In Korea, Naver occupies 70% of the market share (though it saw a 5% decrease compared to last year). Daum and Nate follow behind with 22% and 6% share respectively. Why do Korean users prefer Naver by so much? Is it because its search algorithm is superior to Google’s?

One of the primary factors is localization strategy. Google is a business with core competency around making search results as accurate as possible; however searching option may not be the only feature that Korean users are looking for. Naver accommodated diverse needs of Korean users and made its site a all-inclusive web portal. Naver successfully marketed its catchphrase “무엇이든지 네이버에게 물어봐”, which translates to “Ask Naver for everything”. Also, Naver’s signature green-bordered rectangular search form is ubiquitous in appearance, let it be on TV commercials, newspapers or other online websites.

Now, what does a web portal like Daum have on Google? Daum is most famous for Agora, all-encompassing forums community where almost all things controversial in Korea get started. Agora is Korea’s largest discussion board and it’s not uncommon for most news sources to refer to “from Agora, Daum”. Whether it is social to political issues, if it’s hot, it’s being discussed by the masses at Agora. Agora is leveraged by Daum to anchor its brand value to Korea’s largest and fastest source as the major social issue generator and arouser of public opinion to maintain their position in the market.

Daum doesn’t stop here. Daum was quick to introduce internet map service, not totally dissimilar to Google Maps. Daum’s effort to expand their business domain from online portal to mobile multimedia service provider. “Life on Daum” is their new slogan, and fittingly, the company provides multimedia services in networked interactive displays such as Media Poles in Gangnam main street and Digital View, new interactive display system installed in subway stations in Seoul.

So Naver and Daum constructed ecosystems where Korean users can reside and perform functions more than simple searches. While Naver and Daum boast online community-centric clubs or café pages, blogs and discussion boards, Google’s functions perceived by Korean users thus far are only limited to searches.

Perhaps to play more significant roles in walled garden of Korea, Google may not be in need of brilliant programmers, but instead a dream team of marketers to localize the search engine, to become something more than a site that people visit to perform quick searches.


  1. March 25, 2010 at 1:08 pm — Reply

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  3. March 25, 2010 at 5:01 am — Reply

    This is why Google is struggling so much to maintain their position in Korean market..good writing! 🙂 looking forward to another your new opinion! 😉

  4. Jong Min
    March 25, 2010 at 5:45 am — Reply

    so if Google Korea spent $$$$ on marketing, could they catch up to local players? Can Google increase market share by developing a killer local service? Maybe but I'm not convinced. Naver got an early start with Knowledge Search and old habits are hard to break. Daum? Early start with Cafe then Agora. Same old habits. What's interesting about the Korean users is that they can be influenced very easily. You can basically sell anything to Korean users if you market the product as “luxury” , “hip” and “trendy” I bet I can sell Jordache Jeans as super premium jeans using Hyori. (a bit of hermit kingdom syndrome)What foreign companies have succeeded in Korea? McKinsey (a bunch of ivy league graduate names go a long way), IBM (no alternative Korean companies to compete with IBM), all of luxury consumer goods and a few cultural goods like food, etc. The point is that maybe the Internet services are so localized that it's hard to get over that big wall and that goes both ways. (what Korean companies have succeeded outside of Korea? none…)What's striking is that neither Naver nor Daum have produced any innovative services in a long time….I mean nothing. All of their services are copy cats of what's trendy and proved overseas. (Metoday, Daum Maps, etc) Eventually, Naver and Daum's lack fo competitiveness will erode themselves in time….

  5. March 25, 2010 at 8:07 am — Reply

    I wouldn't call McKinsey a foreign co. success here. just the same global clients they've always had. Nothing special or different they are doing in Korea to make them bust outt of the same few clients that can afford em . IBM? you're kidding right? +_+, luxury brand consumer goods (clothes, cars, cosmetics, etc) … I'll give ya that. but only in the consumer good side of things. But luxury or brand alone does NOT cut it… they spend crap loads too on marketing/biz dev too). Korean companies that have succeed outside korea? Hyundai Motors, Samsung Electronics, LG electronics… but Internet based ones? as a SERVICE… Yahoo Answers which is a rip off off Knowledge search as does pretty well (not great…but fine). Otherwise, yup. FAIL WHALE galore. I mean, Daum bought Lycos…that's even FAIL in terms M&A expansion. lolok… now… I'm going to continue my reply in another reply… heh. 🙂

  6. March 25, 2010 at 9:05 am — Reply

    Interesting perspective … and yes, I agree, marketing and business dev strategy were definitely issues for Google, but there are a few MAJOR factors not mentioned that have undoubtably hindered Google's ability convert Korean users. And one of the biggest factors, imho, among all of Google Korea's local problems is: Naver BLOCKS the googlebot from crawling NHN content. ie: NO Knowledge search or naver blog content on Google Korea SERPs (search result pages). Remember: Google's core competency of providing best and most (free) information /content… in this case, Korean content. So.. the biggest source of the “best” content, Naver, doesn't appear in Google search results… umm… not good. Combine that with the fact that Google for a loooong time didn't even attempt to make original services or content in Korea and you left with…er…and uglier version (according to just about any Korean you ask) of the local search with less content (Korean). kinda same problem google is facing or will with Facebook… which is why everyone is paying FB for search license deals. anyway… there are other big factors..but I figure that is a good one to munch on for now.. heh. 🙂

  7. March 25, 2010 at 9:07 am — Reply

    In otherwords, Naver is like the SoupNazi* of Korean search.”NO CRAWLING FOR YOU!!” — NHN to Google*re: Seinfeld(soooo writing up a follow-up to this article though… good stuff nanyoung! ^^)

  8. philbyun
    March 25, 2010 at 9:24 am — Reply

    Google search engine is excellent. but there are no killer apps for Korean user. They don’t needs to spend the time & $$$ for MKTG. If they launch the killer apps to catch the Korean user, user will change their homepage address as a MSN Messenger. It was leader of instant messenger market. But who is winner of this market? Most of user moves to NateOn. Why do they move to NateOn? When they launched NateOn, they added killer apps (Free SMS). It’s so attractive apps to catch the user. One question.why does google is considering about Korean Market?

  9. March 26, 2010 at 3:38 am — Reply

    This is great stuff, some discussion going on. Everyone has different opinions, as everyone is entitled to one. That is exactly why we have this blog, to make sure people who are interested in Korean IT scene can hear about the latest updates.

    Keep the discussion goin!

    Meanwhile… I do agree that Google has yet to offer killer services… or at least do what NHN and Daum do them better (which I take won’t be easy at all).

    Korean users still recognize the fact that Google is an excellent search engine… but like the author said, people visit Google only to search certain information. As an avid user of, I would search all topics related to Korea in Naver… And I use to search for info/facts/knowledge that transcend geographic boundaries.

  10. jong min
    March 26, 2010 at 5:16 am — Reply

    All interesting points.

    However, at the end of the day, Korea is a niche market. Some call it a testbed but I’ve only seen limited testing done by foreign companies at best. You could say that foreign companies copied ideas to produce Y! Answers…but the end result wasn’t that great….also, the number of ideas exported VS imported is very onesided…and you know which side.

    Korea does some interesting stuff within their own walled garden. (digtial item sales on Cyworld, Knowledge Search but nothing earth shattering in terms of innovative technology) The social and business environment does not foster long term growth. It’s a dog eat dog environment where you have to produce $$$ results very quickly or face the consequences. Failure is not an option. This is not the type of environment where global companies like to invest for long term. This is the anti-silicon valley environment.

    Net net of it is this: Korean market itself is too small for “large” global companies to invest for long term. Think about the logic. An acquisition would be an easy way to win the market for global companies. But would you spend $10B to acquire Naver? For what…so that you can be #1 in Korea and Korea only? You know none of their technologies nor services are exportable… So it’s that simple. Korea is like a big Cirque Du Solei…but as soon as it leaves Korea…it becomes Ringley Brother’s traveling circus……

  11. March 25, 2010 at 3:34 pm — Reply

    I think you regard marketing as advertisment.the answer would be the case of “how NATE ON beat up MSN”(See the another comment philbyun)Consumer goods and Service is different.

  12. March 25, 2010 at 4:07 pm — Reply

    In service, there's no permanent winner.Google was an underdog in China, This could be the one case why google needs to know other countries' market. a service provider needs to take a multi-faceted consideration of its profit model in the context of the particular country, and MSN failed in that regard to let Nateon take the lead. Nateon facilitated the transmission of its sms through its chat client, naturally deriving its higher portion of profit from the high-margin SMS service.

  13. March 25, 2010 at 4:14 pm — Reply

    thank you.

  14. April 22, 2010 at 5:27 am — Reply

    This is exactly what I was wondering about! So what measures should Google Korea take, and would compromising between localizing and Google's own principles be effective in Korea? How can Google promote a localization strategy without losing its identity ? btw great article, I'll be looking forward to a followup soon! 🙂

  15. February 19, 2011 at 11:22 pm — Reply

    What is the market share of Google in South Korea?…

    It’s like 2%. Chang Kim (ex co-CEO of TNC acquired by Google in ’08) explains here in this article why Naver dominates: Here’s another article by the guys at SeoulSpace:

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