Line is hitting the U.S.; here's how its CEO says the app will succeed

Messaging apps have the bit time recently, thanks much in part to the buzz surrounding WhatsApp (and it’s almost acquisition by Facebook). But there are a slew of other international products doing the same thing that are poised for statewide success – including Line.

Line, which is operated by the owner of South Korea’s biggest Internet search engine, broke the 100 million user mark a couple of weeks ago, a milestone worth commending, especially after just 19 months. The messaging app is still dwarfed by Nimbuzz with over 100 million users, and WeChat with 300 million, but to Line’s credit it reached 100 million users in the shortest amount of time. While Asia has been Line’s biggest market to date (with 40 million users in Japan alone), there’s also an emerging demand for Line even in Latin America – and Line figures, soon, in the U.S.

Westward, ho!

While Line has little to now stateside recognition yet, Line USA CEO Jeanie Han tells us that’s about to change. Han is a new hire by Naver (Line’s parent company) and plucked out of Paramount Pictures to run Line’s new USA and Latin America efforts. This isn’t the only planned expansion, however. Because the fastest growing user base originates from Spanish speaking countries (particularly Spain), Han adds, “This office, the U.S.A. office, will head up not only just the U.S., but Latin and European countries as well.”

Why now?

There are a few characteristics that numbers alone can’t identify. So let me put this into perspective. Line has focused on few if any marketing efforts stateside for now. And Han explains to me that finally Line is ready to break into the European and U.S. market now that after sufficient experience growing into the Asian market, Line has a pretty good idea about what works and what doesn’t. To boot, Line fortunately has been growing organically in the U.S. “by just word of mouth.” That would explain why most of you have yet to hear about Line. Admittedly breaking in the U.S. market that has embraced Whatsapp, KiK, and to a degree Facebook Messenger, isn’t a small order. Han knows this as well and so the compny is “going to be very aggressive now in our marketing efforts. We’re going to be out there.” And by “out there” she means celebrity endorsements, and garnering a media presence, among other marketing efforts in the works that she told me to wait to find out about.

Breaking the messaging app mold

So how do you take a messaging app that’s wildly successful in the East and rewrite the marketing strategy for an entirely different consumer audience? There’s no such thing as one-size-fits-all when it comes to apps and different user demographics. Nimbuzz (a company in a very similar position to Line) CEO, Vikas Saxena, realizes this and has said that the app is targeting features based on regions. For example, a public billboard-like feature on Nimbuzz is specific to the Middle East since users there prefer that type of communication platform – but users elsewhere don’t see this.

Line’s strategy works in a similar fashion. If one feature just doesn’t work after initial testing or after its public release, Line will quickly pull it to be shelved. It’s why if you’ve ever checked out Line, you’ll notice that its buttons for choosing a video, pulling up the camera, audio messages, or sharing a location are displayed in square tiles. The tiles can be swapped in and out at a moment’s notice.

At its core, Line wants to keep its platform as simple and uncomplicated as possible. In fact, Han says, Line spends more time about taking features out, as well as doing an inordinate amount of A/B testing and research. “I’m confident to say that what we offer to our clients and to our consumers are really only those [features] that they want to use.”

Simplicity and user demographic-specificity is only one piece to the Line puzzle. “It’s not a just a messaging app. I think that having free calls and free messaging is not enough anymore. That’s almost like a prerequisite,” says Han. What Line is becoming is a “platform.” Line thinks of itself as a “smartphone life platform,” not just another messaging app. The app has games, a standalone camera, a standalone group messaging feature, and even its own version of a mobile social network called “Timeline.”

Privacy

When we talk about messaging apps, we should also talk about privacy, because these platforms have unparalleled access to our personal information. Messages to significant others, or business colleagues can be intimate or classified, and these apps also have our phone numbers (as well as access to our phone books – something Whatsapp recently found itself in hot water over). Han stresses Line’s attention to user privacy. There’s no advertising on Line, Line doesn’t sell your data, and says it collects a very sparse amount of demographic data.

But if Line isn’t selling our data, how does it make money? Is there a nefarious means of leveraging our data that the folks at Naver have figured out surreptitiously? Not at all says Han.

Line says it’s profitable… but how?

Han declined to divulge any numbers, but said “we have no problem on the revenue side” and cites a report from app stat service App Annie. The report written in December 2012, indicates that Line was the top non-game app grossing the most revenue in November 2012. A source familiar with the company’s performance reveals that Line was generating significant revenue, although they weren’t able to tell us if Line was profitable.

Line has three main channels for generating revenue, according to Han: Games, stickers, and official accounts.

Games can be found under the button “More” where you’ll see tiles for Line Bubble, Zookeeper, IceQpick, Line POP, and Cartoon Wars. Like many games out on the app stores, Line’s games are sustained by in-app purchases and there are plenty of players out there. For instance, Line POP garnered 10 million players in just 12 days. There’s also enough revenue generated from these games that Line is constantly creating more games to test before releasing them to the public. “We have a lot of revenue coming in. We have no complaints in that area.”

The most successful venture for Line as of now is stickers, which are blown up emoticons that users can send to each other. The stickers are designed in-house. Believe it or not, users are quite willing to pay this content, and Han credits this feature for the reason that Line “really took off.” Users are sending each other messages entirely expressed through these stickers.

line stickers — Image used with permission by copyright holder

Finally, official accounts are official channels that a celebrity, company, or enterprise can maintain – similar to a Twitter account or Facebook page. Snoop Lion (the artist formerly known as Snoop Dogg) recently opened up an official account, alongside releasing Snoop Lion specific stickers.

add me on #LINE – my official account is live jacc!!!!#expressmore twitter.com/SnoopDogg/stat…

— Snoop Dogg (@SnoopDogg) November 2, 2012

Messaging app meets social network

Messaging apps have started a strange transition from pure functionality to borderline social networks. Facebook’s is making increasing investments in messaging features, and Snapchat’s meteoric rise to the top of the App Store isn’t a coincidence. Apps like Line have a real shot at widespread success in the U.S. market, and now is certainly the time.

Edit: Nimbuzz has 100 million users, not the 200 million users that we reported earlier.

Line is a messaging app meets social network headed for the U.S. market – here’s what to expect