[Why&Next] Why NAVER Is Doubling Down on Membership with 'Nepe Festa'

Search Services Threatened by Global AI Offensive
Expanding Ecosystem by Securing Loyal Customers in Their 20s and 30s

NAVER is stepping up efforts to expand its ecosystem among people in their 20s and 30s, holding its first offline festival, “Nepe Festa,” in Seongsu, Seoul, for members paying KRW 4,900 a month.

According to NAVER on October 19, the exclusive presale for Nepe Festa members drew an enthusiastic response, selling out in just 40 minutes that day. Artists popular with people in their 20s and 30s, including Kwon Jin-ah, Loco, Lucy, Billlie, Silica Gel, ALLDAY PROJECT, Lee Mujin, Zion.T, Car, the garden, and Hwasa, will take part in the event. A NAVER representative said, “Before general ticket sales, we held a presale from September 4 to October 5 for members who had spent at least KRW 200,000 through Npay, and tickets sold out quickly. We expect around 3,000 people to attend, and the strong response from members, which exceeded our expectations, has raised excitement internally.”

Making its debut this year, Nepe Festa was designed to let attendees experience NAVER’s diverse technologies while enjoying the festival. Visitors can enter the venue quickly using FaceSign, NAVER Pay’s deep learning-based facial recognition model developed in-house by NAVER. In addition to fast, walk-through authentication, FaceSign incorporates anti-spoofing technology that verifies the authenticity of a face and prevents security threats, as well as post-quantum cryptography (PQC), to securely store and manage facial data.

Increasing the Number of Customers Paying with Face Recognition Technology FaceSign

NAVER Pay is working to expand its user base by offering instant rewards of 10% of the purchase amount in NAVER Pay points every time customers pay with FaceSign at any of the nationwide merchants equipped with an Npay Connect terminal. FaceSign made headlines in June when NAVER Chairman Lee Hae-jin used it to pay during a “samso” gathering—featuring samgyeopsal and soju—with NVIDIA CEO Jensen Huang and heads of major South Korean companies. FaceSign transaction value in June this year was up 1,884% from January.

At Nepe Festa, attendees will also have a digitally enhanced festival experience through an NFT stamp tour event powered by Npay Wallet, where they can collect non-fungible token (NFT) stamps in a form they can keep permanently. Npay Wallet is a Web3 digital asset wallet service that anyone can easily use with a NAVER ID. It stores and manages digital assets such as tickets to prevent ticket forgery, alteration, and fraudulent transactions.

NAVER’s active push to expand its membership through a festival targeting people in their 20s and 30s is seen as reflecting concerns that, in a rapidly changing internet environment driven by advances in artificial intelligence (AI), securing loyal customers is ultimately essential to survival.

According to WiseApp·Retail, an app and payment data analytics solution provider, Google Chrome is the search and browser app that South Koreans spend the most time using on their smartphones. Last month, total time spent on Google Chrome reached 260 million hours, 20 million hours more than the 240 million hours spent on NAVER. After overtaking NAVER for the first time in May, Chrome remained the most-used app by total time spent for five consecutive months through September, challenging NAVER’s dominance. As global AI services such as ChatGPT and Gemini make inroads and NAVER’s position in the domestic market, which it once dominated, begins to show cracks, securing loyal customers has become NAVER’s top priority.

A platform industry official said, “As AI services that emphasize fast searches and greater efficiency, such as ChatGPT and Gemini, become more widespread, they are threatening NAVER Search. NAVER has little choice but to pursue a strategy of strengthening its membership program and shopping services to create new sources of growth, while also cultivating loyal customers so that users ultimately remain active within the NAVER ecosystem.”

This content was produced with the assistance of AI translation services.