Naver Webtoon, one of the largest webtoon platforms globally, has suffered a significant decline in its core user base, triggering a negative reaction in financial markets. Over just two days of trading, Naver Webtoon’s market capitalization has plummeted by 1.4 trillion won, inciting a wave of selling from frustrated investors and raising concerns about the platform’s future.
Data from the second quarter of 2024 shows that the number of monthly active users (MAU) and paying users (MPU) has declined significantly in South Korea and other major markets. Specifically, the South Korean market, which is essential to Naver Webtoon, experienced a notable decrease of 6.6% in MAU and 7.3% in MPU compared to the same period last year. Although there was an increase in Japan, it was insufficient to compensate for the losses in other regions.
The quality of content has been identified as a primary factor contributing to this situation. Rather than prioritizing the creation of innovative and high-quality works, Naver Webtoon has utilized a mass production approach known as “formula webtoons,” which rely on repeating previously established success formulas. This has resulted in a saturation of similar content, alienating readers and diminishing the platform’s overall appeal.
Industry experts have suggested that the resolution to this crisis lies in shifting focus towards high-quality content creation and promoting intellectual property (IP) that has long-term potential. Enhancing working conditions for webtoon creators and increasing support for more ambitious projects are seen as vital steps to regain users’ trust and stabilize Naver Webtoon’s financial performance.
In the short term, the outlook remains challenging, as additional losses are expected in the third quarter. However, experts emphasize that a strategy centered on content quality and the development of successful IPs could reverse the negative trend and enable Naver Webtoon to reclaim its top position in the global webtoon market.
- «All the drawing styles are very similar.».
- «It grew rapidly due to the internet age, but likewise, low-quality mass production has diminished its value.».
- «They claimed webtoons would surpass Japanese manga, but what happened to that?».
- «I read many webtoons on Piccoma, but many of them drag on without resolution, and when they finally do end, they have typical “our fight is just beginning” conclusions as if they were canceled. Some even conclude abruptly.».
- «“Solo Leveling” is incredibly entertaining. Japan is losing.».
- «Korean mangas all seem to have the same character designs; are they all drawn by the same person?».
- «In webtoons, the story creator, characters, and backgrounds are all different individuals. Since images are generated by AI, many buildings and faces appear similar.».
- «It seems that Jump TOON didn’t pan out either. It might be fine for those looking to pass time, but as a work, it feels more like a disposable product than something you’d want to reread multiple times, resulting in tolerating some contradictions and forced developments.».
Source: Otakomu
Naver Webtoon Faces Drastic Decline Amidst User Exodus
Naver Webtoon, one of the largest webtoon platforms in the world, has experienced a drastic decline in its key user base, which has led to a negative reaction in financial markets. In just two days of trading, Naver Webtoon’s market cap has dropped by 1.4 trillion won. This decline has sparked a wave of selling by disappointed investors, reflecting growing concerns about the future of the platform.
Kim Jun-Koo, CEO and founder of Webtoon Entertainment, is taking a photo with the creators. © Webtoon Entertainment
Decline in User Metrics
Figures for the second quarter of 2024 revealed that the number of monthly active users (MAU) and the number of paying users (MPU) have dropped significantly, both in South Korea and other major markets. In particular, the South Korean market, which is central to Naver Webtoon, showed a significant decrease of 6.6% in MAU and 7.3% in MPU compared to the same period last year. Although there was an increase in Japan, it was not enough to offset declines in other regions.
Factors Contributing to the Decline
The content quality has been pointed out as one of the main causes of this situation. Instead of focusing on creating innovative and high-quality works, Naver Webtoon has adopted an approach based on mass production of webtoons, known as “formula webtoons,” which repeat pre-established success formulas. This has led to a saturation of similar content, alienating readers and diminishing the overall appeal of the platform.
Understanding the “Formula Webtoon” Phenomenon
The mass production method has led to a perception among users that webtoons from Naver lack originality and distinctiveness. As a result, readers are increasingly turning to platforms that prioritize unique storylines and character designs. This trend is exemplified by the following critiques from users:
- «The drawing styles are also all very similar.»
- «It grew rapidly thanks to the internet age, but also for the same reason, low-quality mass production has reduced its value.»
- «They said webtoons would surpass Japanese manga, but what happened to that?»
Industry Expert Opinions
Industry experts have pointed out that the solution to this crisis lies in a shifting focus towards creating high-quality content and in promoting intellectual property (IP) that can be successful in the long term. Improving working conditions for webtoon creators and increasing support for more ambitious works are seen as crucial steps to regain users’ trust and consequently stabilize Naver Webtoon’s financial performance.
Practical Steps for Recovery
Experts suggest several strategies to help Naver Webtoon recover from this downturn:
- Enhance Content Quality: Focus on developing innovative storylines and engaging characters.
- Support for Creators: Foster better working conditions and provide resources for creators to pursue ambitious projects.
- Diverse Offerings: Experiment with different genres and formats to attract varied audiences.
Short-Term Outlook
In the short term, the situation is expected to remain difficult, as additional losses are anticipated in the third quarter. However, experts stress that a strategy focused on quality of content and development of successful IPs could reverse the negative trend and allow Naver Webtoon to regain its leading position in the global webtoon market.
User Experience: First-Hand Perspectives
Users have expressed their frustrations with the current state of webtoons on various platforms. Here are some notable comments:
- «I read a lot of webtoons on Piccoma, but many of them drag on without ending, and when they finally do, they have typical “our fight is just beginning” endings as if they were cancelled. Some even end abruptly.»
- «“Solo Leveling” is very entertaining. Japan is losing.»
- «Korean mangas all have the same character designs, are they all drawn by the same person?»
Comparative Analysis of Webtoon Platforms
| Platform | Monthly Active Users (MAU) | Paying Users (MPU) | Content Strategy |
|---|---|---|---|
| Naver Webtoon | Declining | Declining | Mass Production |
| Piccoma | Increasing | Increasing | Diverse Offerings, Quality Focus |
| Tapas | Stable | Stable | Indie Creator Support |
For further insights, you can read more from Otakomu.
