NAVER Digital Ecosystem Report 2022

 

Since our beginnings as a search engine, NAVER has always valued diversity as a central tenet for growth. We recognize that diversity stems from the success of various small and medium-sized enterprises (SMEs), local businesses, and creators who make up and maintain NAVER’s digital ecosystem today. For this reason, our continued goal is to ensure that everyone in our ecosystem is equipped with the necessary skills, tools, and the opportunity to thrive.

 

The NAVER Digital Ecosystem Report 2022 offers both an overview of NAVER’s digital ecosystem—a culmination of efforts made together by NAVER and our partners—as well as a guide to help us navigate our way forward. 

 

 

Laying the Foundation for Digital Entrepreneurship and Growth

As an easy-to-use e-commerce platform used by 510,000 sellers as of June 2022, SmartStore has effectively lowered the barriers to starting a business. Every year, a new generation of 50,000 to 120,000 entrepreneurs enter the market through SmartStore, indicating a compound annual growth rate (CAGR) of 37% from 2016 to 2021. This exceeds the initial goal of “Project Flower”¹ in 2016, which aimed to create 10,000 new entrepreneurs each year.

¹NAVER Project Flower is NAVER’s core campaign that discovers and promotes SMEs and creators to help them bloom and achieve sustainable growth.

 

 

Empowering Digital Businesses with Technology Tools and Services

Not only do we help sellers launch their business, we also help them grow. As of 2021, over 720,000 cumulative sellers received free training, consulting, and funding through our D-Commerce Program. More importantly, these assistance programs have brought about actual positive results. For instance, our free consulting service helped boost SmartStore sales by up to 278%, while our financial support program had the effect of a 72 to 165x increase in sales growth rates. Sellers also benefit from technology-based tools such as BizAdvisor for data analytics, ShoppingLive for live commerce, as well as AiTEMS and AiRSPACE for AI product and place recommendations respectively. Notably, our Fast Settlement, which operates based on an advanced Fraud Detection System (FDS), ensures SmartStore sellers the fastest payout speed in the world.

 

 

With the help of these tools and services, SmartStore sellers, especially SMEs, have undergone phenomenal growth. SMEs, accounting for 78.8% of all sellers, saw a 138% increase in gross merchandise volume (GMV) in 2021 compared to 2019, outpacing the GMV growth rate of all SmartStores combined. Among those who launched their SmartStore in and after 2019, 84,496 sellers have successfully turned their small business into a digital enterprise with sales exceeding KRW 3 billion (approx. USD 2.1 million). Moreover, we also helped create jobs, with SmartStore sellers hiring more employees at a CAGR of 12% from 2017 to 2021.

 

Connecting Local Businesses to New Digital Markets

NAVER also opens up digital opportunities for businesses previously confined to local and offline markets. In 2021, NAVER helped facilitate 190 million monthly digital connections between local businesses and users through Call, Save, Share, Navigation, TalkTalk (an instant messaging service), Review, Booking, and Order. Local Market Shopping and Farm Fresh, online storefronts for traditional markets and farmers respectively, have served as important sales channels especially as in-store sales took a toll during the COVID-19 pandemic. Currently, Local Market Shopping helps 2,691 shops across 170 traditional markets nationwide receive and process orders online, while Farm Fresh enables 5,726 agricultural and fisheries producers to reach customers digitally.

 

As digital opportunities expand, geographic barriers become obsolete. In particular, SmartStore sales for sellers in Jeju, an island south of the Peninsula, showed the highest growth rate (75%) out of all regions in 2021.

 

Expanding the Global Creator Platform Landscape

As NAVER WEBTOON transforms into a global story tech platform, creators are gaining new opportunities to thrive globally. As of 2021, 60% of all serialized content on NAVER WEBTOON generate revenue overseas. NAVER WEBTOON significantly helps solidify Korea’s leadership in the global webtoon market, as works on NAVER WEBTOON account for nearly 41% of all Korean webtoons with global readership, according to a survey by the Korea Creative Content Agency (2020).

 

ZEPETO, a metaverse platform where 90% of its user base is international, is expanding the global metaverse ecosystem together with its cumulative 2.67 million creators. The global ZEPETO creator economy is growing at a phenomenal rate: in 2021, the number of ZEPETO creators generating revenue increased approximately eightfold year-over-year, while compensation for creators increased ninefold during the same period.

 

Leading the Technology Ecosystem

NAVER invests 24.3% of its revenue in R&D, a leading spender even in the tech industry. We strive to innovate to ensure our ecosystem partners have the adequate tools to grow, but also to advance technology for humanity as a whole.

 

Our multi-pronged IT training programs help cultivate the next generation of software engineers and developers. As of 2021, an average of one million pre-collegiate students used “Entry,” a free online software education program by NAVER Connect Foundation. In addition, about 360,000 cumulative users received online IT training on ‘boostcourse’, while an additional 1,043 students—many of whom currently work at top tech firms—graduated from ‘boostcamp’, an intensive IT talent training program.

 

Our R&D subsidiary NAVER LABS makes its technology and data available to the public, particularly for startups and research teams. Among the open datasets, HD maps and localization data—key to autonomous driving and digital twin technology—have been downloaded 6,519 times, as of June 2022. Meanwhile, NAVER’s strategic investment firm D2SF has invested in a total of 97 technology startups as of June 2022, which altogether have a corporate valuation of KRW 2.7 trillion (approx. USD 1.9 billion).

 

 

The NAVER Digital Ecosystem Report 2022 delves into the value and impact of NAVER’s digital ecosystem. Building on our leadership in technology, international partnerships, and success with global platforms, we hope to expand our impact abroad and further achieve global success with all members of our ecosystem.

* Please find the PDF attachment above to take a deeper look into NAVER’s digital ecosystem encompassing e-commerce, techfin, local business, creators, and technology, as well as vivid success stories of our partners.

 

Original published in Korean (14 Sep 2022)