The Strategic Focus of Corporate Vertical Integration in Korea’s Music Industry

Still under the congress session of “K-Pop Dynamics”, the next presentation was driven by Maria M. H. Kim from Seoul Philharmonic Orchestra and also wrote her paper research with Prof. Kim Jungho from Korea University. Below is the abstract capture.

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She mainly explained about the strategies used by K-Pop industries to keep the artists existence in the industries. The Korean music industry is hyper-competitive with new groups appearing constantly. If not fully supported through competitive marketing and differentiation strategies, incumbent artists are quickly overtaken by competition with new artists.

To begin with, the slide shows the definition of vertical integration. Vertical integration occurs when a company extends its business activities so as to produce its own impacts or gain its own source of output distribution. An example is when a music management company has its own record label and recording studios. These are the activities of vertical integration in the K-Pop industries:

  • Artists training program (pre-debut)
  • Artists management (post-debut)
  • Marketing communication
  • Business and achievement
  • Legal affairs

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Korean pop artist development training is a full cultivation of vertical integration of creating the world-class entertainers. The three most vertically integrated music management companies in Korea are YG Entertainment, JYP Entertainment and SM Entertainment.

Maria Kim also gave a split explanation about each of those big three characteristic in their vertical integration. YG Entertainment focus on their quality of music and song production. SM Entertainment would always achieve the perfection of their artist in dance, vocal, and appearance. And I forget about JYP Entertainment explanation to be honest. In my opinion, as time goes global and that K-Pop also already reach the global market, every K-Pop industries try to engage the international, mostly in the West countries, to help producing their songs and music. We can catch their fast development too clearly.

Thanks to this presentation I get to know deeply how is the K-Pop industries management from the internal. If you want the full paper just contact me, then I will contact Maria Kim.

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2 thoughts on “The Strategic Focus of Corporate Vertical Integration in Korea’s Music Industry

  1. Hello. I’ve gotten into K-pop within the last 4 years. I discovered it through Arirang TV in Chicago. It seems like there are new groups appearing almost every month. It’s hard to keep up sometimes. But I do have my favorites. I wonder if people around the world will keep up too. For example, will people new to k-pop follow up on PSY’s new work in the future? Just a thought.

    Thanks for the moderation.

    Like

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