While webtoons gain momentum overseas, in Korea demand wanes

Having benefited heavily from the webtoon boom that surged during the height of the pandemic, South Korea has marked webtoons as a key driver for future growth.

In January, the Culture Ministry announced plans to invest approximately 4 billion won ($3 million) to boost webtoon production and commercialization. Major IT players such as Naver and Kakao also embraced webtoons as a key part of their strategic vision, with Naver listing its webtoon subsidiary on Nasdaq in June.

Recent data such as consumer time spent on popular webtoon platforms in Korea suggest, however, that webtoon's popularity, which peaked in 2022, may be on the wane.

Was Korea late in riding the webtoon boom?

Experts note that while it might be premature to draw firm conclusions, the industry faces significant challenges, such as the overproduction of content and limited audience reach.

Top webtoon companies in the red

According to data platform company IGAWorks, the total monthly usage time of major domestic webtoon platforms such as Naver Webtoon and Kakao Webtoon, after peaking in 2022, declined for two consecutive years, falling by 5.7 percent in 2023 and 11.2 percent in 2024.

Also, 8 out of the top 10 webtoon production companies reported losses in sales last year, with key players such as Jaedam Media reporting losses of 1.67 billion won after recording a surplus of 1.65 billion won in 2022.

"The general consensus is that the domestic webtoon market is oversaturated. It’s a 'red ocean' here, with too many webtoons flooding the market aiming to realize the profits gleaned by past hit works," said an industry insider on the condition of anonymity.

Experts noted that changing pastime trends and a shift in how younger demographics spend their leisure time are contributing to the decline in webtoons' popularity.

"Now that the pandemic is over, people are using their free time for offline activities such as attending performances and traveling," said Seo Beom-gang, president of Korea Webtoon Industry Association.

"Also, short-form content such as reels is becoming a popular source of entertainment among youngsters, and as such, webtoon consumption is inevitably declining in comparison," he added.

However, Kim said intrinsic factors, rather than external influences such as the end of the pandemic and the rise of short-form content, are more responsible for the decline in webtoon's popularity.

"To facilitate market entry and minimize the risk of failures, too many creators have focused on producing content in similar genres, such as action school series, romance fantasy and time-loop plots. Consequently, audiences have been exposed to the same types of stories repeatedly, leading to fatigue and a drop in webtoon consumption," he said.

Steady growth overseas

However, the decline in webtoon growth appears to be primarily a Korean phenomenon. In international markets, particularly in Japan -- where Korean webtoon companies have made one of the largest inroads -- webtoons are showing steady growth.

In Japan, Naver Webtoon saw a 1 percent year-on-year increase in monthly active users, logging 22 million, and a 15.5 percent rise in monthly paying users.

Additionally, Piccoma, the digital comic platform under Kakao, rose to the top spot for in-app purchases in Japan during the first quarter of 2024.

The Korea Foundation for International Cultural Exchange's survey, which interviewed 25,000 individuals across 26 countries aged 15 to 59 who have experienced Korean cultural content, showed that 30.9 percent of respondents familiar with Hallyu, or the Korean Wave, thought Korean webtoons achieved "mainstream popularity" last year. In 2020, 29.5 percent of the respondents said that webtoons were only popular among a niche group of enthusiasts.

"Although the demand for webtoons has been stagnant in Korea, the demand for webtoons has indeed been growing consistently overseas," said Seo.

To boost the popularity of webtoons on their home turf, Seo suggested that more webtoons with broader audience appeal need to be produced, along with improvements in webtoons' marketing channels.

"Despite the stagnant demand, I believe there is still room for webtoons to grow here. In order to boost webtoon consumption here, webtoons shouldn't be limited to having readers in their teens, 20s and 30s as their primary audience. Instead, there should be content that appeals to a wider range of age groups, from teenagers to readers in their 40s, 50s, and even 60s," said Seo.

"Also, there should be more channels distributing information about webtoons outside the webtoon platforms. Currently, detailed information about webtoons is accessible only through specific platforms," Seo added.