Naver takes on Japan via Yahoo partnership
While it is not Naver’s first time to launch portal services in Japan, the situation appears different this time due to it having partnered with Yahoo, which had previously been its competitor there.
Naver is now equipped with a solid market share in both search engine and mobile messenger services via its Japanese subsidiary Line and is seeking to enhance competency with artificial intelligence capabilities.
Naver and Yahoo Japan’s parent company SoftBank launched the new entity A Holdings, Monday. Naver founder and Global Investment Officer Lee Hae-jin has assumed the position as co-head of A Holdings, alongside SoftBank CEO Ken Miyauchi. A Holdings is the holding company of Z Holdings (ZHD) Group, which wholly owns Naver’s subsidiary Line and Yahoo Japan.
ZHD Group said it will focus on businesses covering search engine, ads, mobile messenger-based commerce as well as reservations, delivery and fintech services, in a presentation the same day.
The new entity is set to apply Naver’s Smart Store e-commerce platform model in Japan. The platform offers a differentiated engagement model with merchants and consumers, as it presents products, tracks orders and deliveries, offers its own payment service and manages reviews.
ZDH is set to help Japanese merchants establish online shopping malls and management. Japan’s e-commerce market has grown at a slow pace, despite its reputation for embracing technology.
The company is also seeking to focus on e-commerce via Line Messenger, which is the most-used service of its type in Japan. It plans to offer services through which Line users can send gifts via the messenger
app as well as purchase certain products with other Line users at a discounted price. It is also planning live commerce, through which Line users can watch influencers introduce products and purchase those items.
ZDH will also offer reservation services for restaurants and accommodations, as well as food delivery services.
In addition, Line Pay’s fintech business will be scaled up to offer loans, investment products and insurance to users. ZDH is seeking to integrate Line Pay and PayPay, the mobile payment app backed by SoftBank.
ZHD Group stated plans to reach 21.2 trillion won in sales and 2.4 trillion won in operating profit by 2023. The company plans to invest 5.3 trillion won into artificial intelligence technology development over the next five years. ZHD’s vision is to take its business beyond Japan into overseas markets. This has been Line’s strategy, which began as Naver’s subsidiary in Japan but expanded its overseas presence with its messenger and fintech services offered in Taiwan, Thailand and Indonesia. Naver GIO Lee has been envisioning Z Holdings’ growth to take on bigtech companies of the U.S. and China.
“Our goal is to become a globally leading AI tech firm based in Japan and Asia,” ZDH stated at the presentation.