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Growth Strategy of KakaoTalk Gift

Transforming Gift Culture
Through a ‘Unique Experience’

Choi Ho-jin | No.402 (October 2024 Issue 1)
Article at a Glance

Most e-commerce platforms imitate Amazon’s SPC (Selection, Price, Convenience) strategy, focusing on offering more products at lower prices with faster delivery. In contrast, KakaoTalk Gift aims for relational commerce, focusing on the relationship between the giver and the recipient, and enhancing the service by addressing users’ pain points throughout the giftgiving journey. Representative features include the ‘Wishlist,’ where users can reveal the gifts they want, and the ‘Recipient Option Change’ function, which allows the recipient to directly choose their desired options, addressing the difficulty users face in exchanging gifts that match personal preferences. Additionally, KakaoTalk Gift focused on full-price sales rather than engaging in cutthroat competition through price discounts and flash sales, enhancing the gift’s value through product selection and packaging, and driving revenue growth with a differentiated merchandising (MD) strategy centered on relational commerce, expanding into the luxury category for exchanging gifts in close relationships.



Despite the surge of low-priced e-commerce platforms from China, such as AliExpress, TEMU, and SHEIN, there is an e-commerce platform that continues to focus on full-price sales without discounts and has introduced high-end specialty stores, making steady progress through bold strategies. That platform is none other than KakaoTalk Gift, often referred to as the “national app.” As KakaoTalk’s first revenue model, KakaoTalk Gift (hereafter referred to as KakaoTalk Gift) began in 2010 by brokering the sale of mobile gift certificates. In 2012, it expanded into the delivery product category, establishing a commerce platform where users can order and pay for gifts directly within KakaoTalk. The KakaoTalk Gift, which revolutionized the gifting experience by allowing users to send gifts without knowing the recipient’s address, has steadily grown since its launch in 2010 and surpassed an annual transaction volume of 3 trillion KRW in 2021. 1 In June 2023, KakaoTalk launched a new luxury specialty store, ‘LuX,’ which features over 120 luxury brands, including Hermès, Dior, Saint Laurent, Bottega Veneta, and CHANEL. By more than doubling the average transaction value, the platform has consistently maintained double-digit sales growth rates since its launch.

There is one key question that penetrates the success of the rapidly growing KakaoTalk Gift : “How can we improve the gifting experience for users?” KakaoTalk Gift, unlike typical e-commerce platforms, focuses on the “purpose and act of giving a gift,” ensuring the price range of gift items without relying on discounts or clearance sales, while prioritizing enhancing the value of the gift through product composition and packaging, in order to increase satisfaction for both partner companies and users. Furthermore, the expansion into the luxury category was a strategy chosen to strengthen the gift-giving experience in close relationships, such as those between couples and family members, rather than mere acquaintances. In addition to commerce, continuous efforts have been made to improve the gifting experience through UX/UI enhancements. The ‘Birthday Friend Notification’ feature, which was introduced to help users easily remember and exchange gifts without the need to manually track friends’ birthdays in a calendar, and the ‘Wishlist’ function, which allows users to reveal the gifts they want, solving the issue of exchanging generic mobile gift certificates due to a lack of knowledge about each other’s preferences, are representative examples. By improving the gifting experience and enhancing the service, the cumulative transaction volume of KakaoTalk Gift has surpassed 15 trillion KRW over the past seven years. Despite the increasing competition from other e-commerce platforms like Naver and 29CM, which have introduced gift features, KakaoTalk Gift continues to maintain its solid position as the market leader and sustain impressive sales growth, so what is the secret behind its continued success? DBR analyzed the growth strategy of KakaoTalk Gift, which has established a unique position in relational commerce, based on interviews with leaders from the Kakao Commerce organization.

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  • This content was translated into English by AI (using DeepL) from an article that was originally written in Korean in the DBR (Donga Business Review). Therefore, please understand that there may be some awkward expressions.
  • The DBR has all legal authority over this content. Please note that unauthorized use and distribution may be subject to legal sanctions
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