Media Business

Our View of the Business Environment

The total advertising expenditures in Japan grew to JPY7.3167 trillion for 2023 (YoY +3.0%).^*1 This was a result of the increase in the number of face-to-face events held due to the transition of COVID-19 to a Category 5 infectious disease, a revitalization of domestic and international tourism and travel, an increase in advertising demand due to the resurgence of social and economic activities, as well as the advancement of digitalization in society, despite being affected by geopolitical risks and rising prices.
Out of the total advertising expenditures, internet advertising spending recorded JPY3.3330 trillion (YoY +7.8%),^*1 maintaining a steady growth as a result of the increased demand in video advertising accompanied by the increased use of connected TVs, and expansion of the digital promotion market. As a result, the percentage of internet advertising spending in total advertising expenditures in Japan grew to 45.5%.

Internet advertising media expenditures, which constitute approximately 80% of internet advertising spending amounted to JPY2.6870 trillion (YoY +8.3%) due to the growths of video advertising and digital sales promotion as mentioned above. By type, paid search advertising amounted to JPY1.0729 trillion (YoY +9.9%)^*2 and display advertising amounted to JPY770.1 billion (YoY +4.5%)^*1 both increasing and accounting for approximately 70% of internet advertising media expenditures. Video advertising recorded a double-digit growth for the second consecutive year (YoY +15.9%) to JPY686.0 billion as a result of the increase in video service users and time spent.

Although the internet advertising market continues to expand with the digitalization of society, personal information protection regulations are increasingly tightened. Therefore, internet advertising platform operators are required to protect users' privacy, ensure thorough information management, and continuously improve advertising quality in the face of changing social conditions.

1. *1 2023 Advertising Expenditures in Japan, DENTSU Inc.
2. *2 Advertising Expenditures in Japan 2023— Detailed Analysis of Expenditures on Internet Advertising Media, DENTSU Inc.

Competitive Edge

Abundant first party data derived from our diverse touchpoints & conversion points only held by us.

Growth Strategy

• Target adjusted EBITDA (margin)35%

1. Enhancement of competitive strength in search/media

As individuals and businesses accelerate their digital usage and internet services diversify, we will work to strengthen the search and media domains in order to improve the competitiveness of the platform itself.

In the search domain, we will improve the quality of our services, especially for search queries, which are highly profitable. Specifically, we will enhance search results for queries such as "commerce search," which is used to search for products for shopping purposes, and "local search," which is used to search for information on local restaurants, hotels, events, beauty care, and so on. In addition, we will work to provide new search experiences leveraging cutting-edge technologies such as generative AI. In the media domain, LINE will be revamped so that the home tab will be changed to a portal tab, and will be redesigned to provide search and personalized news and services. We also revamped Yahoo! JAPAN app by upgrading the tabs to meet user needs, and will aim to increase DAU^*1 and the number of sessions^*2.

2. Account linkage and use of data

In addition to the linkage of accounts of LINE and Yahoo! JAPAN which began in October 2023, we also plan to link the accounts of PayPay in the future. By utilizing the data held by each service, we will reinforce the distribution of advertisements and content that best suit the users and will improve the ad effectiveness.

To make the most of the wealth of first-party data, we will also refine the service data, to improve ad modeling performance and media service KPIs.

Furthermore, by combining with the integration of ad distribution platforms noted later, we will aim to improve advertising unit prices over the medium- to long-term.

3. Reinforcement of user base leveraging LYP Premium

We will aim to increase the revenues of search advertising and sales promotional advertising by promoting the traffic referral among Group services, leveraging LYP Premium, a Group-wide paid membership program launched in November 2023.

Through this program, we will promote the retention of users in the Group's ecosystem to enhance the use of search and promotional services, thereby maximizing ad revenue.

4. Integration of LINE and Yahoo! JAPAN ad distribution platforms

By integrating the ad distribution platforms of LINE and Yahoo! JAPAN, we will provide improved convenience to the ad clients. By enabling batch ad distribution to two media with different features from a single platform, we will support our advertising clients in flexibly allocating their ad budgets and reducing lost opportunities for ad distribution, thereby improving customer satisfaction.

1. *1 Daily Active User (users who have used the services more than once per day)
2. *2 Number of user visits to websites during a specified period
3. *3 The content depicted in these images is under development and may be subject to changes in the future.

Sustainability Initiatives

Communicating sustainability activities

A LINE Official Account, Sustomo (Sustainability Friend), was launched in November 2023 to deliver sustainability-related information. Sustomo aims to provide easy-to-understand information on the SDGs and sustainability, and to provide opportunities to see them as something that concerns users personally. We provide content to deepen users’ understanding on sustainability and suggestions for actions such as making donations and purchasing ethical products, in order to provide opportunities to casually engage with sustainability.
Moving forward, by leveraging these in-house internet media capabilities, and by referring traffic to fundraising and e-commerce websites, we endeavor to raise people's awareness of social problems and address these issues by supporting people and organizations working on the problems as well as backing the users' problem-solving actions.

Playing our part in mitigating and preventing disasters

Every year on March 11, which is the day the Great East Japan Earthquake occurred, we conduct projects to raise awareness of disaster prevention and to support reconstruction in disaster-stricken areas. In 2024, the purpose of the projects was not limited to supporting reconstruction in the areas affected by the Great East Japan Earthquake, preventing the disaster from being forgotten, and raising awareness of disaster prevention. Instead, the projects also covered the victims and areas affected by the 2024 Noto Peninsula Earthquake, which occurred on January 1, 2024. In addition to various fundraising activities through the search service, we worked to help rebuild the areas and raise awareness of disaster prevention by providing a simulation-based disaster prevention content, “Evacuation Drill in 3 Minutes/Smartphone Evacuation Simulation (Japanese only) .”
We will continue to develop and provide services and implement initiatives in the field of disaster prevention that leverage the strengths of our services, aiming for "a future in which as many lives as possible can be saved in every disaster and in every situation."

More details (Japanese only)

Content for children

“ Yahoo! JAPAN Kids (Japanese only) ,” a safe and secure portal website for children operated by LY Corporation, was revamped in February 2024 to provide an even more enjoyable learning environment for children. Today, children are increasingly using the internet to research and learn about things that interest them. Yahoo! JAPAN Kids provides an internet search environment with a unique filtering feature that ensures safety in children’s use. It also provides content that can be used for children’s learning. The revamp includes a redesign to a user-friendly website, and addition of features that make it easier to spark children’s interest in various matters.

In addition, to stimulate the children’s curiosity and expand their future possibilities, we launched a new media, “World Switch (Japanese only)" ” in October 2023. In addition to articles introducing initiatives and ideas from around the world that are implemented to create a better society, World Switch also provides content such as glossaries that explain popular keywords in an easy-to-understand way for children. In the future, we will continue to provide a variety of content to help expand children’s horizons through safe and secure internet experiences.

More details (Japanese only)

Major Services and Products

Search Advertising

Account Ads

Display Advertising

Others