It would be a travesty to go to Seoul Space and only talk about the program but not the start-ups themselves. So here is an overview of some of the start-ups I met.
Party Monster
Party Monster is a weekly group-buying deals site for clubbing, music festivals and concerts in Korea, offering party-goers 50% off retail ticket prices. They identified an opportunity in Korea’s wild night life market by realizing that, clubs will have a guest list but only half of them would actually turn up. To fill that gap, they offer heavily discounted tickets. The target market are early 20-something year old’s who want to start to experiencing clubbing life at a cheaper price. The website also acts as an online promotional platform for clubs.
Co-founders Mike Sim and Peter Yoon were both educated in America and returned to pursue a start-up back in their ethnic homeland of Korea. They have a small team of five, including an ex-CEO of an entertainment company who has strong relationships with all the venues in Korea.
Chatting with Peter Yoon and Mike Sim, Co-founders of Party Monster
Just yesterday (August 2nd), Living Social, the second-largest deals provider after Groupon, announced it has plans to acquire Ticket Monster, South Korea’s largest daily deals site. Mike says that they are “more scalable than Ticketmonster, because we don’t need as many sales staff in different cities.” Also, unlike typical Groupon-style deals that are only one off and expire, Party Monster has a constant flow of events every week, with sales for Friday and Saturday nights.
For customers to buy tickets they will have both a web channel and a mobile iOS and Android channel. Party Monster currently leverages Facebook social media marketing to promote events because “we can hone it down so much by area, age and interests.” Says Mike.
In the future, Party Monster wants to create a B2B guest list management tool that allows club promoters to easily measure ROI of guests and consequently save money.
The team is currently angel-funded and looking to close another round of seed funding.
Spoqa
Spoqa – 모바일 소셜 포인트 카드, 스포카! from Spoqa on Vimeo.
I wrote a post a while ago, arguing that it will be impossible (in the case of China) for that many daily deal sites to survive, forcing a new group buying model based on customer loyalty to emerge. In Korea, there are around 600 daily deal sites and of course they too will face the same pressures. But now, Spoqa, a Korean start-up is aiming to solve the problem of one-off deals that potentially hurt the merchants.
Richard Choi, CEO and co-founder of Spoqa explains that “there are a lot of problems with social commerce right now. A study showed that 42% of Groupon restaurant deals were unprofitable, so we want to solve that problem.”
Instead of one-off deals that offer deep discounts where customers are unlikely to come back, Spoqa is trying to generate repeat business.
So how does it work? Firstly, when a user buys something from a Spoqa partner merchant like pizza or shoes, they use their Spoqa mobile app to collect points. After purchasing, users can choose to tell their friends what they bought and where they bought it through a Foursquare-like location based service, which pushes the information to their social networks like Facebook and Twitter. If their friends also go and buy something from the same store, both the friend and the original buyer will collect points, forming a pyramid-like referral points system, allowing people to become a ‘brand ambassador’. The points can be converted to cash to eventually to buy real items, a bit like a frequent flyer program. Points can only be collected from one degree of separation from a buyer.
Richard says “a genuine social commerce system means whenever you buy something, it affects your friends buying decisions. We added in some gamification elements, such as having to come in a certain period of hours or days to collect the points because for example if you buy something and I buy something a year later, it is unfair for the store. If you a power Twitter user and you tweet out that you’ve had an awesome soup at a local restaurant, resulting in many more people buying soup, the restaurant can make a lot more sales quicker. This gives value to the merchant by getting repeat customers and getting their friends to go to the store.”
Koreans are a coffee fanatic country. Seoul itself is saturated with great cafes. Richard sees Spoqa as a great way for coffee shops to differentiate themselves and attract repeat and new customers by offering this social recommendation engine that gives everyone benefits.
Spoqa plans to turn this into an open platform where merchants can self-upload deals and select how much discount they want to give out. Initially the business model will be freemium but with the aim of monetizing valuable user purchase data that is connected to their social networks.
Although still in testing phase, Spoqa has already been making deals and the response from merchants is favourable where “merchants are sick of giving away 50% group-buying discounts and not getting repeat customers.”
Richard jokes that “We want Spoqa to become so strong that airlines will use it for their customer referral program.”
Skin Heaven
Run by JT Choi, Skin Heave is an e-commerce store for cosmetics. Korea is obsessed with looking good. You will be immediately aware of this after seeing plastic surgery before and after ads on the subways and billboards. There’s even a street of plastic surgery clinics.
Skin Heaven’s stock mostly comes from outside Korea – Switzerland, Italy and America. JT’s products are organic. The website is a straight-forward e-commerce platform where JT orders stock that is purchased on the same day from a warehouse a few miles away and ships it to the customer.
JT has found it difficult to compete with the many online cosmetic stores, even if they don’t stock the same products.
Originally born in Holland, JT also organizes events and is a DJ booking agent.
Related posts:
- Seoul Space is Korea’s Y-Combinator with Korean Flair
- Korean Start-Ups : Starting the New Wave
- Interview with Taiwan Start-Up Incubator, AppWorks Ventures
Link to full article
It seems that Tencent’s recent investments are paying off, the Chinese internet giant just announced its plan to invest over RMB 500 million (US$ 77.7m) marketing expenditure in an effort to foster all-around open strategies and to support quality online stores that operate on its ecommerce platform. Besides, Tencent has scheduled to launch a “super B2C” platform, and the first batch of businesses which will be featured on the platform include OKbuy (online vertical for shoes), elong (flight tickets and hotels booking), Kela (online vertical for diamonds) and so on, all were rumored or confirmed to has been invested by the Shenzhen-based company.
