Kakao's 'Brand Message' Generates 5 Won in Sales for Every 1 Won Spent on Delivery

[Financial News] KakaoTalk's "Brand Message" service has been found to boost sales and repeat purchases for small businesses, while also improving users' convenience in searching for information and making purchases.
On the 25th, Kakao Corp. released the findings on its Kakao Policy and Industry Research Brunch, based on research by Professors Ryu Han-byeol and Kim Ji-hwan of the Department of Economics at Hanyang University ERICA.
The research team analyzed changes in sales, repeat purchases and visitor numbers at 2,510 business-message partners that used Brand Message from June last year to May this year. It found that each 1 won spent on delivery generated about 5 won in sales.
Brand Message is a service that sends promotional messages to users who are KakaoTalk channel friends and have agreed to receive marketing information.
Compared with the period before messages were sent, sales rose 46.2%, repeat purchases increased 30.7%, and visitor numbers climbed 16.9%. The repeat-purchase effect lasted for up to three days after delivery.
For small partners, the sales effect per 1 won spent on delivery was 11.1 won, while sales increased 90.2%, repeat purchases rose 47.3%, and visitors grew 22.6%, the researchers said.
The researchers said users can verify the sender through the channel profile and official certification information, and can quickly review product and benefit details, reducing both time and transaction costs.
They estimated the resulting consumer benefit at about 2.44 billion won a year.
Professor Ryu Han-byeol said, "This study is the first empirical research in South Korea to economically analyze the effects of technologically advanced text-based advertising," adding, "The advertising effects seen among small business operators will offer meaningful implications for small merchants."
 

[email protected] Joo Won-gyu Reporter