With an increasing number of new business operators appearing in the local mobile ad platform market, local and foreign companies are likely to fiercely compete with each other.
According to industry sources on Nov. 28, Indian ad platform company Vizury recently established a local branch in the nation, preparing for its operation. Last month, Chinese web giant Baidu opened a local branch of advertising agency Hylink Ad. Hence, the company is likely to target the Korean online and mobile ad markets.
In recent years, a growing number of global companies have set up local branches to target the local mobile ad market, and they have been growing rapidly.
Indian firm InMobi founded a local branch in 2011, growing 200 percent year-on-year. The number of employees has increased to 20, three years after its establishment. The same is true with Tapjoy, the largest mobile advertising company in the US. After creating a local branch in 2012, the firm increased the number of its workforce to 20 in its purchase of local start-up 5Rocks in August of this year.
Their attention in the Korean market is attributable to the belief that the market is optimized for mobile ads. A representative of a foreign ad company remarked, “The U.S. or Chinese market is much bigger than the Korean market, but Korea has a lot of mobile users and a good network environment, which provides a lot of chances for various challenges.” The representative added, “Our company is more interested in market trends or a change in the market than sales revenue in the country.”
As the number of foreign mobile ad companies is increasing, competition between local and foreign business operators is expected to heat up.
Local online ad platform providers are actively seeking to target the mobile ad market by showcasing services specialized for mobile ads. Existing companies like Dnasoft and MezzoMedia and start-ups such as Mocoplex and Yello Mobile are joining the mobile ad market.
An official at InMobi Korea said, “Last year, large companies like Line, Kakao, Samsung, and Hyundai were our major customers, but small and medium-sized enterprises are also paying attention to the introduction of mobile ads.” The associate added, “I think that competition in the mobile ad market will be more intense, since mobile ads have become more popular.”
Meanwhile, according to the Korea Advertisers Association, the local mobile ad market grew 92.6 percent year-on-year to reach 416 billion won (US$373 million) in 2013, up 200.1 billion won (US$179.5 million) from the previous year.