Innovate Storytelling: How WEBTOON Entertainment Transformed Comics

Webtoon Entertainment, a subsidiary of Korea’s dominant search engine, Naver, with over 60% of the market share, is a prime example of how a company creates and captures new market opportunities in the era of digital transformation. With its humble beginning as a free service to increase user traffic to the portal site by providing digitized comics for web surfers, Webtoon Entertainment reinvented the comic book industry by changing the way comics are created, distributed, and consumed. Briefly, Webtoon Entertainment is a platform that connects creators and users of digital comic content in the form of a vertical layout that is optimized for PC and mobile browsing. The company now boasts 82 million monthly active users on its digital comic platform across the globe. The case explores the key milestones of Webtoon Entertainment to show how the company transformed the comic industry and became the largest storytelling platform in the world. More specifically, it describes how the company unlocked new creative talents and built an ecosystem for webtoon business based on a platform economy, monetized the once-free content into a billion-dollar business, and then rolled it out globally despite cultural and language barriers. Finally, the case describes the challenges ahead that Webtoon Entertainment faces in the lucrative yet competitive comics industry. Interestingly, the case has multimedia materials, including first-hand interviews and infographics, directly embedded between the written content. Students are able to access these materials via QR codes and are visually stimulated while elevating their comprehension of the case. This will be a whole new reading experience for students that immerses them in the evolution of Webtoon Entertainment at a different level, ensuring an active and rich class discussion. The case is suitable for teaching innovation, entrepreneurship, digital transformation, platform strategy, and globalization strategy.

1. Analyze the strategic logic of Webtoon Entertainment to identify and capture a new market opportunity in the declining comics industry 2. Understand the difference between digitization and digital transformation, and explore the implication of digital transformation with respect to value creation 3. Analyze the platform strategy of Webtoon Entertainment that reconstructed the existing industry and its consequences 4. Assess the global strategy of Webtoon Entertainment to scale up their culturally bound content business from Korea to the world 5. Understand the business model of Webtoon Entertainment that monetized once-free content to paid content, and developed the value of webtoons as intellectual property 6. Explore the corporate business portfolio of Naver Corporation to show how a webtoon business became the search engine company’s new growth engine.