South Korea is an interesting place. Being one of the most tech-savvy nations in the world, the modest-sized country remains to be Asia’s hottest market for international business expansions. Even with the Covid-19 pandemic, online business opportunities are stronger than ever due to Korea’s exceptional Informational Technology services.
While the entry barrier may be low compared to China and Japan, lack of knowledge on South Korea may bring adversities making a mark in South Korea, and may even fail. Many of the major corporations have already tried and failed, and it’s not going to get easier. Here are some of the factors that you REALLY need to know before you do business in Korea.
1. Who Koreans Are - Cultural and Trend Sensitive
One of the first and the most important points (that are often ignored) is to differentiate South Korea from their Asian neighbors, particularly China and Japan. South Korea has a distinctive history and culture that the natives are very proud of. The three countries each share emotional and often hostile relationships, both in business and in culture. The current issues of the Hanbok incident and the ‘No Japan’ boycott would be good examples to understand the correlation.
The respect for the culture with the right localization will bring immense appreciation from Korean consumers, not to mention the revenues. Doing them wrong, however, may result in national embarrassment, let alone total failure. It’s better not to attempt localization at all than to do it even a tiny bit wrong (this goes the same for other Asian countries).
Koreans are adaptable, strategic, and calculating but are also highly emotional and impulsive with whimsical trends. Many major businesses flopped in Korea because of their incompatible, not-up-to-date strategies in the ever-changing market.
2. What Koreans Today Want - Work-Life Balance and “소확행”
South Korean society can be extremely demanding. To be free from such a life, younger generations of Koreans have become conscious of qualities in their lives. People began to care more about the work-life balance and started to search for their own “소확행” (“Small but Certain Happiness” in English). Even in their busy lives, Koreans try to find new hobbies and go to places. Instead of buying expensive brands to try and fit in, people started to look for their own personal brands to fit their needs.
The word “소확행” became the most popular word in South Korea in 2018 and continues to be the main keyword in the Korean market. Smaller, less-known brands and services finally have their niche opportunities.
3. Go Mobile or Go Home - The Extreme Demand for Mobile Services
Finding a niche market will mean nothing in South Korea if your business doesn’t have mobile services. As mentioned above, South Korea is one of the most technologically advanced nations in the world, and most of the Korean services provided today are through smartphones. Koreans spend most of their free time on it, and all of the services mentioned above are required to be available on mobile. Also, Koreans demand fast, reliable services that are easily accessible, which means that everything should be optimized for their phones. Digital marketing is on the rise in Korea, and they depend on mobile apps and services for data gathering and strategies.
While the Korean market is very much open with plenty of opportunities, it’s no pushover. Continuous studies on the fast-moving nation are required, but as long as you’re up to date, there are going to be countless open doors.