This £550m represents approximately 3% of total ecommerce revenue in the country which suggests there is a large opportunity for foreign ecommerce sites.

Overall these revenue numbers place South Korea neatly behind Japan and China in terms of the size of market, and opportunity within the region.

While this may not be a surprise to many considering the populations of the two aforementioned countries, there are additional factors that need to be taken into account when surveying potential market opportunities.

The country boasts an impressive internet penetration rate of 84%, higher than any other APAC country and only just behind the UK and Canada. This is down to South Korea’s highly developed mobile landscape that has a penetration rate of around 70%.

There are a number of reasons for this but it is predominantly driven by an incredibly fast internet infrastructure, advanced mobile technology and a population with a strong understanding of how to navigate the online world, across a wide range of demographics.

A high propensity to purchase

Despite the maturity of this market, when approaching international expansion, South Korea is often overlooked by global brands. This is most likely down to the focus on other APAC nations such as China and Japan.

However, despite only having the 8th largest population in the region, South Korea has the third largest ecommerce market and as a result, ecommerce traffic has a high propensity to purchase. We can measure this by calculating the ecommerce revenue driven per person using the size of the ecommerce market and population.

For China, this figure comes in at $217, while South Korea has a substantially larger figure of $386. This suggests visits driven to your ecommerce site from South Korea are more likely to convert and spend more money, than other APAC countries, providing a really efficient foundation to develop a business.

What does this all mean? Well fundamentally if you’re a business looking to grow a brand in Asia, South Korea is a low risk territory to develop and achieve a foothold in.

Utilising search is vital in this endeavour this due to the levels of intent consumers show through their search queries. The challenge is that South Korea and Asia in general have a much more complex search engine landscape than in the Google-dominated west.

Loyalty to domestic platforms

Much like in Russia and China, the South Korean population consistently favours domestic online platforms compared to Western services.

Search engines are no exception with Naver and Daum the major players at 80% and 15% market share respectively. Google takes just 3.5% of the share and Nate, another domestic web portal, claims 1.1%.

Despite the low market share, Google is still a fairly strong player due to the search engine recently enjoying an increase in mobile usage thanks to the popularity of Android based mobile devices.

Ensuring that Naver’s 80% share is well catered for is obviously the priority but ignoring Google’s growing market share on mobile would be missing an opportunity to drive high quality traffic and cover any searches driven by international visitors within the country.

A wide range of SERPs and ad formats to consider

The range of local platforms is not the only thing that affects the search landscape. Each of the search engine’s SERPs look very different from what we’re accustomed to in North America and Europe, making it difficult for conventional international advertisers to succeed.

In Naver’s case, PPC is called ‘Powerlink’ and shows at the top of pages, but often rotating to the middle or bottom of the page, even for brand keyword variations. Therefore, other Naver formats such as BrandSearch are the key to securing premium positioning.

From the work I’ve overseen for brands in this region, paid ads on South Korean search engines can experience conversion rates up to 166% higher than in the Chinese market, with half the cost-per-clicks. This reinforces the potential efficiency on offer for international brands in South Korea.

With regards to the rest of Naver’s SERPs, it’s important to stress that traditional organic search engine strategies and tactics will not necessarily bear fruit in South Korea. The majority of non-PPC content spots on the search engine, such as Blog, Site and Cafe, are not populated naturally though the engine’s crawlers system, but submitted by brands and advertisers themselves.

Cafe, Blog and Site content areas on Naver

A mobile led market

Mobile commerce is dominating the South Korean landscape. KakaoTalk is available in a number of countries, yet it remains by far the most popular format in South Korea, utilised by over 93% of smartphone users.

The platform offers a plain messaging function similar to WhatsApp, yet also offers the option of creating a profile through ‘KakaoStory’, allowing businesses to engage in advertising and promotional activities.

This has made this application the channel of choice for advertisers and domestic brands in particular. Naver has also strived to develop a mobile social platform called Line. Whilst hugely popular in Japan, as well as Taiwan, Thailand, Spain and Indonesia, it has not yet managed to conquer KakaoTalk in its native market.

Developing a healthy return on investment from mobile is tough enough in Europe and North America let alone in a region like APAC. The mature and experienced consumers in South Korea expect your presence on all these platforms and formats.

The opportunity is there for new entrants

South Korea is a truly unique market, as consumers visibly prefer local brands to popular international companies. Samsung and LG in the electronics field, Hyundai in the automotive industry, Naver, Daum and Nate in search and KakaoTalk in mobile are all proof of a tendency towards favouring domestic brands and products.

A strong understanding of local platforms is essential for success in South Korea. So too is developing specifically tailored strategies for the market instead of simply adopting a global approach.

When testing the South Korean market for your brand, PPC alone won’t provide the necessary results to judge the potential of the market; a combination of PPC, blog and social is required to give a business a fighting chance entering a valuable but complex market like South Korea.