Market Decision Making Case Study Cyworld

Catherine Concannon
BMBA-9457
Market Decision Making
Due: 9/5/2017
CYWORLD
To no surprise, the 21st century held the rise of the internet signaling the growth of several social networking websites, which gave individual users the power to carve out their own niche and create their “alter ego” as an outlet to a way of self-expression. For many Koreans their outlet was a Cyworld.
Due to Cyworld’s unique revenue model of selling virtual items to over 20 million users, it had become revolutionary as it pioneered user experiences into community gifting and public threads. However, just like every other new fad, in 2006, the social networking market was declining on user activity and loyalty, which was the heartbeat of Cyworld. In August of 2008, Cyworld’s parent company, SK Telecom, brought in a key actor, Hyung-Chul Joo, as the newly appointed CEO of SK Comms (online services division of

With that being said, it is my opinion that Cyworld focus its strategies solely towards this youth group to revive its mission and re-inspire its main user-base with bold, contentious strides forward. The next question is how will Cyworld cater to it’s users above the age of 35 with all of its focus on the Korean youth? It’s Simple, it won’t. Cyworld should make a bold announcement stating that they are implementing an “Age Restriction” tool. Although this step seems risky, I believe it will create added shock value that Cyworld needs. Sure it might stir up some controversy, but it will get people talking about Cyworld and will also display a sort of loyalty and exclusivity to their new targeted Korean Youth. Additionally, this age restriction could potentially increase, based on the data provided in the HBR. Exhibit 10 illustrates that 72% of Cyworlds revenue came from the Korean youth market, as they were mostly responsible for the “Paid Items” – such as minihompy designs and accessories and music