Asia's messaging apps have a history of becoming huge in their home market before struggling to gain traction overseas. South Korea's Kakao Corp. is counting on the Japanese love of manga to break that trend.
Amassing 43 million users at home has driven Kakao's market value to 8.3 trillion won ($7.4 billion) but it's little known outside South Korea, a factor that's contributed to a 31 percent share price slump from a peak in August 2014. Earlier efforts to add customers in Southeast Asia and Japan have foundered as it ran head-first into dominant apps like WeChat and Line.
To attract customers in Japan, and compete against a host of rivals in the $4 billion manga market, Kakao's Piccoma app adopted a new business model. Instead of charging per book, it sliced them into chapters to provide smaller and cheaper offerings and win over casual readers rather than just hardcore fans. Not only has that added users and boosted revenue, but is helping it develop a platform in the country as it actively considers a Tokyo stock listing in 2020.