Power of BTS in K-pop and Global Music Industry

(Photo credit: Big Hit Music / article posted October 7, 2022)

BTS is unreplicable.

(Distinction: I used word “unreplicable” deliberately, rather than using the word “irreplaceable”, because BTS cannot be replaced; nor can what BTS has achieved be replicated. No one can replace BTS and it is inconceivable that another artist can replicate what BTS has achieved.)

BTS aka Bangtan Sonyeondan has created an immersive experience through their music and by sharing so much of their personal and professional lives for the past 10 years — creating a curated and addictive music experience that captivated and engaged fans from every country across the globe.

In monetary numbers alone, BTS dominates — whether it is generating $230 million dollars from 12 concerts or by selling over 10 million album units in the U.S. (over 4.5 million career pure albums in the U.S.) By estimate, BTS generates more than the rest of the current K-pop bands combined (after combining album sales, digital sales, streaming revenue, merchandise sales, as well as concert revenue from both in-person and virtual streaming ticket sales).

If BTS is going to be taken out of the K-pop industry for 18 months to 3 years so that they can fulfill their South Korean government requirement of mandatory military service, that removes a massive amount of potential revenue from the K-pop industry. It also derails a significant amount of momentum.

Groups such as Stray Kids, Seventeen, TomorrowXTogether, ENHYPEN, Twice, BlackPink, aespa are gaining momentum and traction in U.S., as well as other world music and entertainment markets, but the gaping hole left by BTS‘s absence cannot be under-estimated. It will be devastating.

Speaking from my personal experience, I discovered BTS two years ago and it compelled me to research and buy BTS’s entire discography, not to mention attending their concerts (as many as possible), in addition to streaming their online concerts. BTS inspires purchases and spending money. It also persuaded me to check out other K-pop bands and artists and to buy their songs/albums and purchase their concert tickets. BTS does not just generate revenue for themselves, they inspire music consumers to check out and discover other K-pop artists. That influence is powerful.

K-pop as an industry owes debt of gratitude to BTS for cultivating an avidly-interested and excited group of music consumers in the U.S. (and around the globe) that now pays close attention to emerging and existing K-pop artists, who are generating phenomenal music.

Because of the recent heightened interest — that buzz, excitement, enthusiasm, and willingness to spend huge sums of money on albums, concerts, and merchandise — no current K-pop artist can match or replace the amount of money that BTS fans willingly spend each year. That same interest and investment of funds requires time to tether or create attachment to other K-pop artists.

Success in music depends on momentum and traction. But success in the U.S. music industry requires two additional elements: stickiness and saturation. These last 2 elements are essential and were huge stumbling blocks for BTS to conquer as it took BTS seven years to achieve all four elements.

Stickiness and saturation are not easy to achieve. It requires finding a way to capture the hearts and imaginations of consumers. So selling entertainment to viewers and consumers is not easy, and capturing hearts and imaginations is even more elusive — yet, incredibly, BTS figured it out and did it.

From a marketing and promotions standpoint, BTS is No.1 at it. They have reinvented themselves, experimented with styles and sounds, explored various messaging tactics, and are experts at creating an immersive-experience. BTS has figured out how to be addictive. Yet, all this took BTS a key amount of time.

It is easy to see how groups like Stray Kids, Seventeen, TomorrowXTogether, ENHYPEN, BlackPink, Twice, aespa have benefited from watching/learning from BTS’s strategy, marketing and experimentation. But it still takes a significant investment of time to achieve stickiness and saturation by other K-pop artists.

The phrase BTS “paved the way” is accurate. But “paving the way” is only part of what it takes to succeed into U.S. music markets. Time to achieve stickiness and saturation is essential. It BTS took five years to reach prime saturation and stickiness within U.S. markets.

“Stickiness” is different from traction. Traction only requires the purchase of music, albums, merchandise and concert tickets. “Stickiness” is achieved by bonding or establishing emotional tethers or connections between the artist and their fans. That requires an emotional component and is achieved once the consumer or fan sees the artist as distinct individuals, and not just the band or a brand.

In K-pop, tethering can be achieved by encouraging fans to have a “bias” — a favorite member with whom they identify and root for. K-pop also encourages “bias-wreckers” which is a second favorite in band or a rotating interest in other members depending on the timing, circumstance, or visual attraction. In the U.S., tethering requires more than recognizing or encouraging a “bias” preference or interest. It requires getting to know each member of a group individually — seeing all equal parts of the whole, not just seeing one person. Thus, it is more about getting to know and rooting for each member (individually) and then becoming invested in each member, as well as attachment and emotional connection to the band.

Thus, time is what is needed for the K-pop industry to succeed further in U.S. and other global markets as the needed emotional tethering is attained by exposure, education, and time in order to appreciate and form bonds. BTS has “paved the way” and shepherded the K-pop industry into U.S. music and entertainment markets, as well as cultivated a built-in enthusiastic base of consumers primed to purchase music, merchandise, and concert tickets. But, remove BTS from the equation and the K-pop industry deflates.

Certainly the adverse economic-impact to South Korea will be significant, especially if BTS is pulled out of K-pop industry for 18 months to 3 years. Any analyst can see that. But what is another key factor is assessing the loss of momentum and traction to the entire K-pop industry (globally).

K-pop went from a small niche of global music industry (estimated to be 5%) to currently dominating nearly 30% of entire global music industry. (NOTE: My estimate is based on: the global music industry generated $25.9 billion for 2022 — 30% would be $8.6 billion — BTS generates estimated $4.65 billion and the rest of K-pop artists generate an estimated $4 billion combined. K-pop is estimated to generate a total of $12.3 billion annually as of 2019, with album sales up 93% from June 2021 to June 2022 with HYBE’s music artists contributing 48% of that increase in sales.)

To maintain momentum, traction and achieve stickiness and saturation for each K-pop artist takes time, and while the past two years were helpful, it was not enough.

It will take more time to allow K-pop groups and artists to reach and attain the massive numbers of fans that BTS has attracted and the level of stickiness and saturation that BTS has achieved. Assuming all best favorable factors to reach BTS levels, it could take other current K-pop artists another 2 to 3 years minimum, if not longer.

It is also entirely possible that no other K-pop artist will ever achieve what BTS has achieved. BTS’s 10-year journey captured the world’s attention, imagination, and hearts in ways that seems impossible to replicate. Thus, removing BTS for period of time would be catastrophic. Catastrophic to the entire K-pop industry and to South Korea’s “soft power”, which is dependent on an entertainment-reliant economy, as well as South Korea’s perceived success in the world through its exports of music, fashion, food, and beauty products, which have blossomed and are in high demand in the past two years.

There would also be a significant adverse-effect within U.S. music and entertainment worlds, which has become more dependent upon South Korean K-pop industries to drive traction, momentum and consumer-interest and consumer-spending. Accordingly, derailment and money-retraction would be across board.

I call it a form of “economic cannibalization” as the end result is that South Korea has essentially eroded their own position as a global power, as well as their national economy by continuing to impose the mandatory military requirement of its male idols and performers. This creates an arbitrary age limitation within the music and idol industries — imposing a deadline and a needless race against the clock of aging and perpetuates age discrimination, as well as body dysmorphia disorder, in the music and idol worlds. It also forces South Korea’s talented youth out of their trained professions and careers at what should be the beginning of their entertainment careers, not create a premature end point of their careers by the age of 30.

Currently, the South Korean idol and music industries limit themselves to appealing to young teens and twenty-somethings in South Korea and other countries. Yet, this creates a needless limitation based on an outdated perception of age obsolescence. Idols and music performers can successfully continue their careers beyond the age of 30 — particularly as their fans age and want to stay connected to their favorite music artists and idols. The unfortunate result is South Korea has created its own “bamboo ceiling” for its entertainment industry by limiting entertainment artists’ careers to an arbitrary age — especially since South Koreans work tenaciously and successfully to maintain their beauty and youth well beyond the age of 30.

BTS is not just “driver” in K-pop, they are the beating-heart of it. BTS is the key ingredient that anchors interest, fascination and consumer-spending. What BTS brings to entire music industry is “buzz” and power to stimulate spending. Thus, the power of BTS should not be under-estimated.

South Korea knows (probably better than anyone) the sheer economic-power that BTS wields. South Korea paid for study in 2019 for exactly that data. Yet that data is only half of it — what needs to be assessed are scale of economic impact outside of South Korea and consideration of how removing BTS from of the equation derails, stalls, or slows the entire K-pop industry.

BTS was the spark that ignited K-pop across world. The demand for anything BTS-related (music, concert tickets, merchandise) is currently at peak consumer levels and no other K-pop artist is close to those numbers. That consumer-interest is rooted in the excitement that BTS generates.

Because South Korea already has created existing category exceptions to its required mandatory military service for athletes, Olympic competitors, and other key contributing fields of academic interest, it remains difficult to understand why BTS does not qualify for an exemption when BTS is essential K-pop growth.

Right now K-pop has the attention of the entire world as BTS has broken through and captured attention of the zeitgeist — that elusive feat is worth a considerable amount of money — and BTS holds the zeitgeist in the palm of their hand. That is pure power. It is time to “bend the knee” and recognize that power.

(BTS’s strategic release of the songs “Dynamite” and “Butter” followed by “Permission To Dance” and collaborating with Coldplay on “My Universe”, as well as securing two consecutive Grammy nominations for “Dynamite” and “Butter”, which secured newfound respect in BTS as musicians and performers, as well as exponentially increasing their momentum, traction, stickiness and saturation into the U.S. music industry and markets.)

If BTS be taken out of zeitgeist equation for 3 years, the economic loss will be unfathomable. BTS will always be massively popular and their fans will always be there for them. But the loss of sharing that popularity and consumer-interest with entire K-pop industry will be unrecoverable.

The “tipping point” is now. There is a reason why everyone is watching to see whether South Korea grants military exemptions to BTS — it matters to fans, it matters to K-pop industry, it matters to the global music industry.

Simply put: it matters — and the whole world is watching.

For those curious, here are some of my sources:

“Bang Si Hyuk Breaks Down HYBE’s Withdrawal From SM Acquisition, BTS’s Return From Hiatus And Contract Renewals, And More”

“Bang Si Hyuk suggests a business outline for the ‘Future of K-Pop’ in the absence of BTS’s team promotions”

HYBE has released an ENG translation of Bang Si-hyuk’s 3/15/2023 speech re Factors Necessary for K-pop Industry to continue beyond BTS (1/2) and (Part 2/2)

“HYBE Says There Is No Set Date for BTS Comeback, Asks for Respect for Members’ Privacy”

“BTS’ Contract Renewal and Proposed 2025 Comeback Are Both Currently Uncertain, HYBE Says”

“The BTS-Led K-Pop Boom Hits a Military Roadblock”

“IFPI Global Report 2022: Music Revenues Rise for Seventh Straight Year to $25.9B”

“K-pop is making billions for South Korea

“K-Pop Mastermind Dealt $2.6 Billion Blow With Surprise BTS Break”

“BTS Ponders Its Future, and South Korea’s Economy Warily Takes Note”

IFPI Global Music Report 2022

“Best-selling artists in Korean history (until September 22nd, 2022)”

“Digital Trends in the Consumption of South Korean Music Industry Cultural Products”

“Analysis on South Korean Soft Power— Taking BTS, Parasite and Squid Game as Examples

“K-pop Group BTS Induces Production Worth 4 Tril. Won per Year”

“BTS Is Back: Music’s Billion-Dollar Boy Band Takes the Next Step”

“BTS’ agency’s corporate value soars above $1b: think tank”

“The “BTS Effect” on South Korea’s Economy, Industry and Culture”

(Note: Additional information sources and chart examples of BTS’ album sales by year and BTS concert revenue 2021-2022 as compared to a few other notable Kpop groups are provided within my Twitter-threads dated (1) October 7, 2022, (2) September 24, 2022, (3) September 20, 2022, (4) September 19, 2022 (5) September 2, 2022. I also expanded a bit on the power of BTS in generating sales of concert tickets and albums in my February 4, 2023 tweet-thread with examples, and provided further linked articles and information about HYBE’s financial losses and the statement made Bang Si-hyuk to press about it on March 14, 2023.)

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