The K-Pop Bubble: Is the Industry Facing Its First Decline in Album Export Value in 9 Years?

Based on data from customs import and export trade statistics, the export value of K-pop albums for the first half of this year, from January to June, was $130,321,000 (equivalent to 179.4 billion KRW). This marks a 2% decrease compared to the corresponding period in the previous year.

This is the initial occurrence of the album export value displaying a decline during the first half of the year since 2015.

The export value saw a decrease of 7.0% from 19 billion KRW in 2014 to 17.6 billion KRW in 2015. However, it has been steadily increasing since then and reached 183 billion KRW last year, fueled by the popularity of K-pop Hallyu.

Analyzing the album export value for the initial six months of this year based on country, it is evident that Japan had the largest value at 64.8 billion KRW, trailed by the United States at 42.1 billion KRW, and China at 25.4 billion KRW.

The overall sales volume of K-pop albums, which serves as an indicator of the market size, also saw a decrease.

The total number of album sales for the top 1-400 albums between January and June of this year amounted to approximately 47.6 million copies, representing a decrease of around 8 million compared to the same period last year.

Nevertheless, the industry holds the belief that this marks a crucial stage in the re-emergence of K-pop.

The upcoming plans of K-pop’s biggest IPs, BTS and BLACKPINK, are expected to bring even more success in the second half of this year and in the following year. Both groups are considered to have a promising future in the industry. BTS is set to make a full-group comeback and continue their global activities next year, while BLACKPINK’s full-group comeback is also highly anticipated.

The K-pop industry’s re-entry into the Japanese market is a promising development, with local idols such as KATSEYE also making strides. SM Entertainment is currently in the process of launching a British boy group, and their debut journey will be documented through the BBC.

The trend of new artists making their debut continues with SM Entertainment planning to launch a girl group and virtual artist in the second half of the year. Additionally, HYBE is said to be in the process of preparing another boy group for a debut targeted for next year.

Despite the decrease in album sales, the popularity of music streaming continues to grow steadily. In order to keep up with this trend, HYBE has announced their plans to implement a paid subscription model on their fan platform, Weverse.

Despite the anticipated recovery of album sales in China being the biggest contributing factor, if the progress of revenue traction in major developed markets such as the US and Japan is slower than expected, the K-pop crisis phase could extend. According to Lee Ki-hoon, a researcher at Hana Securities, the impact of the decrease in Chinese album group orders has lessened in the recent comebacks of idol groups.

The sources for the information include Krb, SED, and iMBC.