Cyworld Case Study PDF

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Cyworld is an independent social networking company created by a couple of college students. They had about 21 million users in a country of 50 million people, with 90% penetration within the 20 - 29 year-old market, as of 2007. Cyworld positioned themselves differently by providing users with a “small, clean community” which displayed minimal banner ads than their competitors, Daum and Freechal. Cyworld offered “profiling” which allowed users to click on their friend’s name in the address book, receive their friend’s information, and leave a message for them. Cyworld was also known for their concept of “minihompy” (mini home) which acted as a homepage for users to write diaries and invite their friends to visit and leave messages behind. Users created their own alter ego/avatar, and could walk into their friends minihompy even if they weren't there to leave a message, photo, or video behind for them to see when they logged on. Users also had the option to send a “virtual gift” to their friends to decorate their minihompy. Users could decorate their minihompy with virtual art, electronics, furniture, and more. Many of Cyworld’s users spent several hours every day on this site, as this site strengthened friendships users already had, along with new friends they met. The main issue Cyworld was concerned about was user loyalty declining over time. Through their consumer research, it came down to user segments as some users logged on more in the span of a week than others. They could not lose a user that was considered a “connector” which acted as a hub for their network of friends - revenue would decline if so. Their two main challenges were reaching saturation with over 21 million users, and almost 90% penetration of their target audience. Second, users were tired of buying items to decorate their minihompy. Cyworld looked at other options like basing their strategy off “personal media.” This was an upgraded minihompy allowing users to now share news, photos, and videos. They created Home2 which was a combination of minihompy and blogs. It would also give users more freedom to be flexible and creative. Most Cyworld users migrated to Home2. An efficient solution for Cyworld would be to add a variety of different things for users. When looking at social media, all companies have a variety of segments that need to be met for each set of consumer needs. If Cyworld wants to reach these needs, they should be seasoned in multiple areas. For example, they should continue to include the personal media strategy for consumers, so this would allow them to blog, look at news/events, videos, while still being able to strengthen friendships/relationships with others. They don't need to completely change their image, just implement additional benefits that keep up with new trends. This will differentiate their site from direct and indirect competitors because it seems most are only focused on one segment. As a consumer in Cyworld’s target market, I like social networks that can provide multiple avenues of creativity. I may not use all features, but knowing I have the option to provides comfort. Overall, Cyworld seems to have “SIM” features that the U.S teens/young adults are more familiar with. Combining the virtual feel of creating your own minihompy along with social media features such as blogging, sharing media, and instant messaging, sounds like a perfect app for most teens and young adults. It fulfills the need for a virtual reality, while keeping up to date with news, viewing others creativity, and connecting with friends and potential new ones....