HYBE’s Global Strategy Shifts Towards Localization: Focusing on North America and Latin America
On the 11th, key executives of major South Korean entertainment companies unveiled their essential strategies for global expansion at the ‘Korea Investment Week (KIW) 2023’ event.
Jaesang Lee, Chief Strategy Officer (CSO) of Hybe, emphasized the importance of focusing on the international market, stating, “In the global music market, K-pop accounts for less than 5%, while the revenue scale in the United States is over 13 times that of Korea.” He stressed that survival depends on targeting the overseas market, saying, “Even for Hybe, only about 33% of its revenue comes from the Korean market,” and added, “The rest comes from North America (32%), Asia (31%), and other regions.”
To expand its international business, HYBE is creating content based on local culture, similar to Netflix. CSO Lee explained, “To increase overseas revenue, we aim to foster local artists in various genres such as hip-hop, Latin, country, and pop to create a ‘multi-home’ market.” This means growing multiple stable revenue streams in global local markets similar to the domestic market. He also emphasized, “To ensure that K-pop culture does not fade away, K-pop entertainment companies need to secure fandoms as much as they do artists.”
Eunji Sim, Co-CEO of JYP Publishing, also highlighted the strategy of “globalization through localization” as the fundamental strategy for overseas business, stating, “JYP has been nurturing local K-pop stars in Japan, the United States, China, and other countries since 2018.” JYP is set to debut local idol groups in Japan (Nizi Project), China (Project C), and the United States (A2K Project) this year.
Jungmin Choi, Chief Global Officer (CGO) of SM Entertainment, took pride in SM Entertainment’s existing “fandom,” stating, “SM Entertainment, as a K-pop pioneer, already has a fandom called ‘Pink Blood’ who love our unique music style, performances, visuals, and more.” He also revealed plans to expand publishing (distribution and services) and IP businesses that can further extend the reach of K-pop.
CGO Choi explained, “We have monetized non-core assets and invested the funds in our own publishing subsidiary.” He added, “We will cooperate with the major platform, Kakao, to maximize the value of intellectual property (IP).” CEO Sim emphasized the growing importance of publishing in collaborating with foreign writers, saying, “Publishing plays a crucial role in actively collaborating with overseas writers.”