Since its launch back in 2013, the Best Korea Brands report has become a key performance index for Korea’s Top 50 brands. Showcasing the latest trends and the most successful branding initiatives, Korean Best Brands total brand value has increased by 5.8% year-over-year to reach KRW ₩138 trillion (approximately USD $120 billion).
This year, Interbrand took a deeper dive into the report to uncover the secrets behind those brands which have managed to outperform the most influential brands in Korea. For instance, AmorePacific has grown by an astounding 26% YoY to become the fastest-growing brand in Korea. AmorePacific was followed by other contenders such as LG Household & Healthcare, which grew by 18.6%, Naver by 15.4%, Kakao by 23.7%, CJ E&M by 15.3%, and others.*
Upon closer examination, these brands displayed a common trait, one that would transcend categories and the nature of their business: It was the ability to connect emotionally with customers which enabled them to claim their spots as the fastest growing brands in Korea. How they grew so fast, can be classified into two representative categories:
*All statistical figures per aforementioned brands refer to CAGR growth rates.
2016 was a year of change for many brands in Korea, as they transcended traditional ways of doing business and utilized technology to better connect with consumers.
For instance, in financial services, diverse customer experiences were made possible through mobile platforms that evolved from existing loyalty programs. KB Kookmin Bank evolved itself into a lifestyle one-to-one service platform by launching Liiv Mate, which features everything from Dutch-pay services to media content. Shinhan Bank’s FAN club enables customers to withdraw their loyalty points from the ATM and turn them into cash.
The use of big data and AI by credit card companies was also notable with Shinhan Card releasing FAN Pay Bot, a secretarial service which provides customized advice based on individuals’ consumption patterns.
Brands are expanding beyond their traditional areas of business to gain more of customers’ life-share.
Tech brand Naver, which used to be just a search engine/internet portal business is expanding its influence through the development of an AI-powered translation app called Papago, which is rapidly gaining popularity among tourists to Korea, with over one million downloads.
Kakao, which started out as a messenger platform, has now expanded into taxi services and navigation with Kakao Taxi and Kakao Navi, further increasing the time users spend with the Kakao brand. Later this year, they will also be launching Kakao Bank, which is a 100% mobile banking experience.
Up close and personal
Consumers in Korea are more demanding than ever, as they expect brands to develop products “just for them.” To respond to such trends, market leaders such as AmorePacific and LG Household & Healthcare have created personalized products, which cater to each individuals’ needs.
For instance, Laneige (a brand of AmorePacific) created “My Two-tone Lip Bar,” which allows users to choose two of their favorite colors and combines them to form a single cosmetic product with engraved messages for a more personal effect. Innisfree (another brand of AmorePacific) introduced “My cushion, the way I want it,” allowing customers to choose from 12 cushion bases and 100 different cases to create the cushion product tailored just for them.
LG Household & Healthcare introduced the Remede brand, which provides one-on-one skin care consulting services and creates a product that is tailored to each consumer’s skin needs.
CJ group took the personalization trend one step further by creating a culture of “enjoying alone.” CJ E&M launched a TV series featuring characters who enjoy the single life. CJ CGV, the leading cinema brand in Korea initiated a “singles day” promotion, offering people who watch movies alone a special discount. CJ Cheiljedang, which is CJ Group’s food and beverage business, is bringing ready-to-eat dishes to market for those who wish to enjoy great tasting meals by themselves.
The trend is clear, and the opportunity is huge for those businesses that seek to lead in this rapidly changing age. Brands that create a truly personalized and curated experience around the individual are those that will continue to grow the fastest.