Kakao is preparing to launch a new membership that bundles services across its affiliates, potentially bringing shopping, finance, ride-hailing and entertainment under a single subscription.
“We are preparing a membership service that links Kakao’s various services and benefits,” Kakao said Wednesday.
The company is preparing to launch a beta version by the end of this year, according to industry
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“We are working out the details with our affiliates and partner companies,” a Kakao executive who requested anonymity said.
Specific benefits and subscription fees have yet to be determined.
Kakao currently operates a range of paid services through its affiliates. The KakaoTalk messenger app offers Emoticon Plus, a subscription that gives users unlimited access to emoticons for 3,900 won ($2.85) a month. Kakao Mobility operates a membership for its taxi-hailing app Kakao T for 4,900 won a month. The membership offers discount coupons and points for services including taxis, bikes and parking. Kakao Entertainment also offers paid services on the music streaming service Melon, Kakao Webtoon and the content platform KakaoPage.
Experts say Kakao has plenty of services that could be bundled into a single membership, which could help it lock its nearly 50 million KakaoTalk users into its broader platform ecosystem.
There is also speculation that financial and payment services from its Kakao Pay and KakaoBank could be included. Potential benefits could include getting higher reward points when making payments through Kakao Pay, as well as getting discounted fees for stock trading.
Another key question is whether Kakao will expand the membership beyond its own services.
Kakao CEO Chung Shin-a announced Kakao will pursue an agent-to-agent partnership with food delivery platform Coupang Eats during the company’s second quarter earnings call. The partnership aims to allow KakaoTalk users to go through the entire process from food recommendations to ordering and payment without leaving the messenger app.
Other companies have been joining forces to expand membership offerings.
Naver has expanded its Naver Plus Membership, priced at 4,900 won a month, by offering Netflix and Spotify subscriptions. Users can also get free dawn and same-day delivery through a partnership with e-commerce platform Market Kurly.
Kakao’s membership service is ultimately seen as an attempt to find a new growth model. While KakaoTalk is widely used among Koreans, the messaging app itself is free to use.
Advertising and commissions from transactions made through its commerce services have been among its revenuelk advertising, in-app shopping and gift-giving services — was 643.2 billion won in the second quarter, up 12 percent on year
A screenshot shows products available
Despite the solid performance, the business is widely considered to have limited potential to become Kakao’s next major growth engine. Naver, meanwhile, saw second quarter revenue from its e-commerce platform Naver Plus Store, membership program and N Delivery — which offers early-morning and Sunday deliveries — rise 31.3 percent from a year earlier to 455 billion won.
Many say the success of Kakao’s membership will depend on whether it can offer services that justify the price.
“It actually feels somewhat late for Kakao, a company that provides business-to-consumer services, to be launching a membership only now,” said Wi Jong-hyun, the dean of Chung-Ang University’s College of Virtual Convergence. “Coupang has expanded its Wow membership through delivery benefits, while Naver has grown its membership through commerce and rewards. What matters is whether Kakao can come up with a differentiated service of its own.”
