Generating over $330 million in revenue last year, Line has shown the world how a messaging app can earn boatloads of money. During a visit to Line’s Tokyo office, COO Idezawa Takeshi, revealed that games accounted for 60 percent of its revenue. The rest is split equally between stickers and business services like official accounts and branded stickers on Line.
As its current business model stabilizes, Line is constantly searching for new ways to engage users while continuing to drive revenues. One of its most recent efforts to do so has been in e-commerce. For example, cosmetic brand Maybelline conducted a flash sale on Line in Thailand which saw 500 lipsticks sell out in five minutes. Also in Thailand, Line saw its branded iPhone cases get snatched up under 25 minutes.
Takeshi said that flash sales have been successful for two major reasons. First, Line is primarily a messaging platform which has strong push feature. Second, since Line is primarily used on mobile, flash sales get users’ attention quickly and efficiently. Could the same reasoning be applied to mobile commerce in general? Line certainly thinks so.
With several rounds of successful e-commerce tests under its belt, Line had the confidence to launch Line Mall, a B2C and C2C e-commerce marketplace. Line declined to share data about its Mall application but did say that it will launch in full by March or April. Line Mall is currently available only on Android, but an iOS version is expected to arrive this Spring.
How long can the sticker craze last?
Anyone who uses Line actively is likely to find it fun. Its character sticker sets deliver cuteness in droves. But in addition to just being cute, a sticker can sometimes digitally express an emotion better than thousand words can.
So in which countries does Line truly dominate? Japan, Thailand, and Taiwan. At the risk of overgeneralizing, it seems to me that countries with a strong kawaii culture tend to like Line a lot. But the real question is, how long can the cute stickers craze last? Even Hello Kitty, at some point, has slow periods. If Line’s characters lose popularity or if users grow tired of stickers, inevitably, Line will lose its appeal. While conceding to this argument, Line chief strategy and marketing officer Jun Masuda added:
We admit that the characters might not be popular as time passes and we haven’t thought what to do after that. We can always add in new characters. If there comes a day that the world doesn’t like characters, we will do something else. But LINE isn’t just about stickers. There’s other stuff like music, e-commerce, and manga. We are a platform.
Winning in other markets
With over 20 million registered users in Indonesia, Line is confident it can dominate the Indonesian market. Over the past couple of years, the mobile messaging app has blasted TV ads across the country in an effort to acquire more users. It has localized to meet market needs as well. For example, Line in Indonesia is available on feature phones. Sending stickers is as easy as sending an SMS. Takeshi said:
User numbers in Indonesia are growing very well. There are a lot of competition but we are doing really well. Line has a strong chance to be at the top in Indonesia.
Elsewhere, Takeshi also singled out Line’s performance in India, where the chat app reached 16 million registered users, as particularly promising. “There are 800 million mobile users in India. The potential is huge,” said Takeshi.
Outside of Asia, Line is experiencing huge growth in Spain and South America. Only about 14 percent of its 350 million registered users originate from Japan. As of February 6, 2014, Line’s registered user stats are as follows:
- Global: 350 million
- Japan: 50 million
- Taiwan: 17 million
- Thailand: 22 million
- Indonesia: 20 million
- Spain: 16 million
- India: 16 million
- Mexico: 10 million
- Korea: 10 million
(Editing by Josh Horwitz and Terence Lee)