Growth Factors of Programmatic Advertising in South Korea


Mobile is driving programmatic advertising growth worldwide. While North America is still by far the biggest programmatic market to date, making up 58% of global spend, Asia’s rapid growth rates mean it’s quickly catching up. In this article, we’ll focus on South Korea, one of the most important app markets in the world. Let’s take an in-depth look at the country’s growing programmatic market.  

Let’s start with the numbers! 

South Korea ranked first in the world for smartphone ownership and internet usage in a developed economy, with 95% of adults owning a smartphone. They also spend a lot of time on mobile—teenagers spend almost 4 hours each day on their mobile devices. So it isn’t surprising that mobile ads have the lion’s share (73%) of the country’s digital ad spend. These factors are the foundation for wider adoption of programmatic.

Steps Towards Programmatic

Although traditional media is still effective for certain types of campaigns in South Korea, the way the industry operates is adapting for programmatic. 

  • Gaming is leading the market

South Korea was the world’s fourth-largest mobile game market in 2018, after China, the United  States, and Japan, with $5.6 billion spent on mobile games. Mobile games contributed 84.9% of total mobile app revenues in the country in 2018. 

Research firm Mintegral also found that 40% of smartphone users spent money on mobile games in 2018. The most popular segments were power-ups (41%), playable characters (38%), and cosmetics/skins (35%). 

Still hesitating whether you need to invest in programmatic in the country? Let’s go further. 

  • Video remains the top media buy among all ad formats

According to Business Korea, the video-based display ad market grew 38.7% between 2018 and 2019, accounting for 52.7% of the mobile ad market.

Most users opt for large-screen devices, which perhaps helps explain why video is more popular than in other regions. This is a great opportunity for marketers, as video creatives help show how the app works and its best features while enhancing the user experience. 

The Impact of Creative Localization

South Koreans like to keep it local – meaning that they prefer to use apps in their own language. 

Ad localization should be top of mind while tapping into new territories in pursuit of wider audience reach. Altering your message based on the target users’ geographic locations will increase your chances of getting audiences’ attention and will make it seem like they are talking to someone who knows them well and can be trusted.

At Aarki, we build creative variants from the ground up with localization in mind. Mobile ads have very little room for graphics and text, which means every letter counts.

To prove the importance of localized creative ads in South Korea, we analyzed the performance of two campaigns - gaming and non-gaming.

While analyzing the gaming app performance during a period of one month, we saw that compared to English ad variants, the performance of the localized creative ads had a whopping 100% increase in Return on Investment (ROI), 39.43% decrease in Cost Per Install (CPI), 200% better Install Rate (IR), 11.32% better Click-through Rate (CTR), and 71.11% better Conversion Rate (CR).

Non-gaming app performance also hit the advertiser’s KPIs: CPI went down by 102.57%, CR and IR increased by 79% and 34% respectively. 

                             Gaming UA                                             Gaming RT

            KR-meditation-UA   KR-meditation-RT
                            Non-gaming UA                                  Non-gaming RT

South Korea’s Bright Programmatic Future

Programmatic advertising is evolving globally, and mobile has the lion’s share. South Korean publishers have realized that in order to target desired audiences, scale relevant ad creatives, and measure ROI, their programmatic media buying strategies need to be more data-driven and transparent.

The future of mobile app advertising lies in programmatic media buying and we are proud to host programmatic-focused events like Programmatic Connect Seoul and Aarki Nights Seoul to evangelize programmatic and share our knowledge and expertise. Watch out for our next Programmatic event! Stay tuned for more details.

Topics: Industry News