The K-pop industry’s new growth engine: DTC
Korean entertainment companies that sign K-pop artists are launching their own Direct-to-Consumer (DTC) stores. Cafe24’s platform makes it easier for K-pop artists and the entertainment industry to reach their fans around the world.
K-pop embraces DTC for global fans
K-pop is one of the hottest trends in today’s global pop culture. Its strong visual appeal and catchy music earned K-pop artists massive fandoms all over the world, spanning from North America, Europe, to Asia.
K-pop fans have a unique fandom culture that cultivates a sense of belonging. Fans tend to own merchandise like cheering kits and accessories to represent their shared support for the artists. Consequently, Korean entertainment companies that sign K-pop artists are launching their own Direct-to-Consumer (DTC) stores to serve fans directly. These companies are going further to meet rising fan demands by collaborating with cosmetics, lifestyle, and F&B brands to provide a wider range of goods.
In 2019, SM Entertainment, one of Korea’s Big Three entertainment companies, launched its official SMTOWN&STORE in English, Korean, Japanese, and Chinese. The store uniquely features an automatic recommendation feature that makes product suggestions for each visitor according to the artist they like. The store also carries products that artists recommend for their fans. The SM store is built on Cafe24’s platform.
BRANDNEW MUSIC, FNC Entertainment, and KONNECT Entertainment are also entertainment companies operating their online stores on Cafe24’s platform.
Cafe24 helps expand K-pop commerce business
Cafe24’s platform makes it easier for K-pop artists and the entertainment industry to reach their fans around the world.
Responding to rising K-pop demands in one-stop
According to the Korea Creative Content Agency(KCCA), the Korean music industry in 2017 exported 320.60 million dollars in album sales and licenses to Japan, 109.93 million dollars to China, 64.74 million dollars to Southeast Asia, 5.46 million dollars to North America, and 8.85 million dollars to Europe. In particular, exports to North America rose at an annual rate of 124.5%, from 1.09 million dollars in 2015 to 5.47 million dollars in 2017. These export rates signal that K-pop’s target markets have diversified over the recent years.
In keeping with this trend, Cafe24 supports multi-lingual online stores, country-specific payment methods, and overseas shipping. The company also offers integration with marketplaces like Southeast Asia’s Shopee and China’s Tmall, allowing merchants to expand their sales channels wherever there is demand.
A commerce environment that encourages focus on creativity
Cafe24’s ecosystem leverages its partner network – which includes design agencies and developers – and its open platform to maximize online store customization.
This allows entertainment companies to use the templates and functions they want for their stores. Such flexibility increases their control over creating a shopping experience that aligns with their artists’ identity and branding. Customization is one of the benefits of DTC stores unavailable in online marketplaces, where merchants are given standardized product pages and have little room for branding.
Cafe24’s ecosystem also offers various Business Process Outsourcing (BPO) services, which provide operational support to the desired extent. With the support, entertainment companies can run their DTC stores with minimal effort and focus more time on producing creative content with their artists.