Can Facebook conquer the Asian markets?
The Asian markets have proved something of a stumbling block on Facebook’s path to world domination. While Mark Zuckerberg’s brainchild has reached an astonishing eighth of the world’s population, it has been slow to make an impact in Japan, South Korea, and other East Asian countries. It’s not through lack of interest in networking. Socially-engaged users have tended to prefer home-grown companies over the global giants.
But this now appears to be changing. The social platform has seen some of its largest gains in user numbers in East Asian countries in the last six months, according to recent reports. And some data suggests that Zuckerberg’s marketing push is finally paying off, with Facebook edging past Cyworld in South Korea for the first time this year.
There are a number of reasons why these countries have proved tough markets to crack. Cyworld was launched at roughly the same time as Facebook, by a pair of Korean Advanced Institute of Science and Technology graduates. It failed to make an impact on international markets, but gained a huge following at home. Its focus on blogging, online games, “clubs” and chatroom, was carefully tailored to its home market. Unsurprisingly, it handled the tricky Korean language much better than its foreign competitors.
And it’s not only in social media that South Koreans prefer a local product. The country is considered one of the most tech-savvy in the world, with some of the fastest broadband connections. This perhaps explains its strong culture of technological development. Products such as search engine Naver have managed to hold their own against the all-conquering Google.
Japan is another anomaly in the world social media landscape. Until recently Mixi was its preferred way to chat and socialize online. Japanese users liked its emphasis on network connections, and the fact they can use pseudonyms and easily hide personal information. It also has a sophisticated and user-friendly mobile interface – hugely important given the popularity of smartphones.
But Facebook has managed to make significant inroads in these countries in the first half of 2012. Its recent IPO included details of its strategies to increase its user base in Japan, India and South Korea by targeted marketing and tailored mobile apps. These plans are particularly significant given its growth is slowing in the United States.
And it appears to be working so far. Facebook gained 20 million users across Asia this year, bringing its total to 192 million in 24 countries. A May 2012 report from Nielsen KoreanCLick, the local operation of Nielsen, found that Facebook overtook Cyworld in user numbers in February. Some of this is due to its strategy of persuading celebrities to use the network. Pop star Kim Hyung Joong, is one of the most popular figures using the site.
In Japan, the story is similar. After a slow start, Facebook is catching up, and usage soared by 61.6 per cent in 2011 compared to 2010. This is expected to continue this year. Although the penetration is still low, those who have taken the plunge appear to be hooked, with more than half visiting the site every day.
It’s not all reasons for celebration though. The network saw a drop in users in key Southeast Asian markets in Indonesia, the Phillippines and Malaysia in the last few months – a cause for concern as these were tipped to be growth areas.
And of course China is a major gap in the network's dominance, with censorship making it still a no-go area to both Facebook and Twitter. It does have an estimated half million “unofficial” users in the country, but this is still a tiny fraction of the population. Zuckerberg has been open about his determination to enter this market, knowing the longer he leaves it, the harder it will be.
As social media use continues to grow in East and Southeast Asian countries, Facebook looks set to focus more attention on these markets. It's made impressive gains so far this year. But it still faces an uphill struggle to match its success in America and Europe.