individual assignment topic bighit music analysis

About BigHit MusicBigHit Music is a South Korean entertainment company that specializes inthe management and production of music, particularly in the K-pop genre.Big Hit Music was founde

FPT UNIVERSITY - CAMPUS HO CHI MINH

INDIVIDUAL ASSIGNMENT

TOPIC: BIGHIT MUSIC ANALYSIS

Course: MGT103

Name: Ngô Trần Ngọc Vy

Code: SS192814

b BigHit competes with the Big3 in the music market 7

I INTRODUCTION

1 About BigHit Music

BigHit Music is a South Korean entertainment company that specializes in the management and production of music, particularly in the K-pop genre Big Hit Music was founded in 2005 by Bang Si-hyuk, who is a music producer and entrepreneur The company initially started as Big Hit Entertainment before rebranding to HYBE Corporation in 2021 Big Hit Music has gained significant recognition for its focus on K-pop, one of the most popular and influential music genres globally

(topchuyengia)

2 History

In the early years, when it was still known as BigHit Entertainment, the company introduced several male and female music groups, but they only operated for a short period before disbanding It wasn't until 2013 that they debuted the boy band BTS At that time, BigHit was still a small company burdened with significant debts, on the verge of bankruptcy Surprisingly, in

2017, BTS achieved remarkable success with the Love Yourself album series, transforming the nearly bankrupt company into one of the leading entertainment companies in South Korea

Beyond music production, Big Hit expanded its business into various sectors

of the entertainment industry, including concert and event management, merchandise sales, and more In March 2021, Big Hit Entertainment decided

to change its name to HYBE Corporation to reflect the diversification of its business activities and expansion into various entertainment fields

3 Other active artists under BigHit

As of date, the label is home to soloist Lee Hyun, Lee renewed his contract with Big Hit in March 2021 and opened a YouTube channel in celebration of his 14th anniversary with the company that same month

Worldwide boyband BTS BTS is the most globally recognized K-pop group, BTS is managed by Big Hit Music, the group has achieved immense success both in South Korea and internationally At present, all seven members of BTS have temporarily ceased activities due to fulfilling their military service obligations, but they have renewed their contracts with Big Hit and are expected to reunite in 2025

And their most recent music group is TXT TXT is another boy group managed by Big Hit Music, they debuted in 2019 and quickly garnered attention for their music and performances TXT's commercial success in their early months earned them several rookie awards at major Korean year-end music award shows

4 Market share

HYBE Corporation, formerly known as Big Hit Entertainment, is a major South Korean entertainment company In 2022, HYBE derived around 594.4 billion South Korean won in revenue from domestic sales The largest share

of overseas revenue that year came from Asia, which accounted for around 566.2 billion won in revenue1 However, it’s important to note that the market value of Big Hit Entertainment is over $8bn, and BTS, which is under Big Hit, accounts for 88% of its revenue This suggests that Big Hit’s market share is significant, but it’s also heavily reliant on one group For more specific market share percentages, you may need to refer to detailed industry reports or financial statements from the company

(Statista Research Department 2023)

II TASK ENVIRONMENT ANALYSIS

1 Competitors

a Competitive companies

BIGHIT faces competition from various entertainment companies, particularly those involved in managing K-pop groups The K-pop industry is dynamic and highly competitive, with several companies vying for market share and global recognition In this context, BIG3 is identified as a significant and noteworthy competitor of BIGHIT in the K-pop industry, adding another layer to the competitive landscape The term "BIG3" is often used in the context of the entertainment industry, particularly in South Korea, to refer to the three major entertainment companies that have significant influence and dominance As of

my last knowledge update in January 2022, the "BIG3" in the K-pop industry typically refers to three major entertainment companies:

- SM Entertainment:

+ A leading entertainment company in South Korea

+ Famous Artists: EXO, Girls' Generation, NCT, Red Velvet + Features: SM Entertainment is one of the largest entertainment companies in South Korea They manage numerous famous artists and have diversity in areas such as music, acting, and investment in entertainment projects

- JYP Entertainment:

+ Another prominent player in the K-pop industry

+ Famous Artists: GOT7, TWICE, Stray Kids, ITZY

+ Features: JYP is also a large and reputable company They focus on artist development through talent search programs and collaboration with artists in music creation

- YG Entertainment:

+ Famous Artists: BIGBANG, BLACKPINK, WINNER, iKON + Features: YG is renowned for powerful music and the distinctive image of their music groups They are also involved in acting and music production

b Bighit competes with the Big3 in the music market.

Bighit and Big3 are the most powerful and successful leading companies in the industry, dominating the music charts with various music groups However, with the global success of BTS, BigHit Music has also become a major player

in the industry (Odessa Gaines 2022)

In fact, BigHit has risen above the ranks to make it in the Top 3, dethroning one of the ‘Big3’ companies BigHit has ranked above JYP Entertainment, leading BigHit to be ranked 3rd and JYP Entertainment ranked 4th The revenue of BigHit mostly comes from BTS’ success and with the debut of their newest boy group TXT, it is expected that their revenue will continue to rise (Koreaboo 2019)

According to market value numbers, BigHit Entertainment’s market value has now hit ₩4.5692 trillion KRW ($3,908,341,525 USD), surpassing the existing

‘Big3’ companies This shows that BigHit Entertainment has been very successful in competing with the ‘Big3’ in the music market (Jasmine Turner 2020)

(Graphic: Yoo Jeong-Soo, design journalist)

2 Customers

Their main customers are fans of their music artists, especially the globally renowned boy band BTS These fans are typically young individuals who actively engage on social media and participate in the band's music, merchandise, and online content

The customer base is often characterized by the following:

+ Age Group: Fans are typically young individuals, including teenagers

and young adults, who are drawn to the music and content produced

by the artists managed by BigHit Entertainment

+ Online Engagement: BigHit employs storytelling and social media to

connect with their customers They understand the power of each social media platform and online streaming and leverage them to enhance and optimize the messaging of their artists They participate in discussions, share content, and contribute to the overall online presence of the artists Bighit owns Weverse, an online platform that allows fans to connect with artists and music groups, as well as purchase official products and participate in online events This strategy has helped them achieve dominance worldwide

+ Consumption of Music and Merchandise: Customers of BigHit

Entertainment are avid consumers of the music Bighit releases albums and music products of its artists, primarily BTS This includes purchasing albums, attending concerts, and buying official merchandise Bighit produces and sells branded products related to its artists, including clothing, hats, and other accessories Products like dolls, posters, and toys related to the artists and music groups are created to meet the demands of fans Customers engage in these purchases to express their support and affection for their favorite artists and music groups Bighit has effectively leveraged the appeal of its artists to create a diverse and rich entertainment ecosystem to cater to the needs of fans

+ Participation in Online Events: Fans often participate in online

events organized by BigHit Entertainment or the artists, such as online concerts, fan meetings, and interactive social media campaigns

+ Emotional Connection: Many customers of BigHit Entertainment feel

a strong emotional connection to the artists and their work Bighit addresses customers' challenging issues such as feelings of loneliness and isolation by delivering messages of comfort and positivity through their music This approach has generated resonance with many individuals, contributing to their success

Additionally, BigHit is recognized for its innovative business model where the company and artists collaborate as business partners This model has contributed to their effective competitiveness in the music market It's worth noting that the customer base may vary depending on the specific artist or group managed by BigHit For example, the fanbase of BTS may differ from that of another group under the management of BigHit

(Pinterest)

3 Suppliers

BigHit has various collaborators These collaborators may include other entertainment companies, music producers, and other service providers BigHit has also expanded its strategic partnership with Universal Music Group, one of the largest music companies in the world (Universal Music Group 2021) However, specific information about BigHit's suppliers may not

be widely disclosed due to security and competition concerns within the entertainment industry Bighit's suppliers may include music production partners, merchandise and advertising production companies, event management firms, and various other partners in the supply chain and entertainment business management For instance, when organizing a concert, Bighit typically collaborates with multiple partners and different suppliers to ensure the success of the event

Some types of suppliers that BigHit typically engage with include:

+ Event Management Companies: These partners may take responsibility for event management, stage design, security, and other aspects of the performance

+ Audio and Lighting Companies: They provide sound, lighting

equipment, and performance technology to create an engaging experience for the audience

+ Theaters and Event Venue Providers: Collaboration with theaters

and event venues to organize concerts, events, and tours

+ Logistics Service Providers: These partners may handle transportation, storage, and inventory management for products and merchandise related to concerts

+ Media and Advertising Partners: These partners assist in promoting

and advertising events, helping to effectively communicate the message to the target audience

Or, if they want to produce an album for their artists, Bighit can collaborate with:

+ Music Production Companies: Companies that collaborate with

artists and entertainment labels to create and produce music for albums

+ Mixing and Mastering Engineers: Professionals who refine the sound

quality of recorded tracks to achieve the desired audio balance for the final album

+ Manufacturing Companies: Companies responsible for physically

producing the CDs, vinyl records, or other physical formats of the albums

+ Printing and Packaging Companies: Partners involved in designing

and producing the album artwork, printing inserts, and packaging for physical copies

+ Digital Distribution Platforms: Online platforms that distribute and

make digital versions of the albums available to consumers

4 Strategic partners

BigHit Entertainment, also known as HYBE, has strategically partnered with several key collaborators:

+ Universal Music Group (UMG): BigHit and UMG announced an

expanded strategic partnership, where the two companies will closely collaborate to enhance opportunities for artists through innovation and technology They aim to globally expand the reach of K-pop music and culture Additionally, they revealed plans for a historic project to form and debut a new global K-pop boy group in the United States

(Finversia)

+ YG Entertainment: UMG became a shareholder along with BigHit, YG

Entertainment, and Kiswe in the premium online streaming platform VenewLive by KBYK

(marQsar)

+ Weverse: Weverse is a community-based platform that allows

dedicated fans of artists to engage, share, and interact Users can access and enjoy new content and purchase related products

(weverse.io) However, specific details about other strategic partners of BigHit may not be widely disclosed due to security and competition considerations within the entertainment industry (Universal Music Group 2021)

5 Regulators

a Regulatory agencies

Regulatory agencies can impact Bighit Entertainment (now HYBE Corporation) in various ways, depending on the industry and business activities of the company Here are some ways in which regulatory agencies can influence Bighit:

+ Korea Communications Commission (KCC):

● Content Oversight: The KCC may monitor Bighit's media content

to ensure compliance with regulations and principles regarding content

+ Korea Copyright Commission (KCC):

● Copyright Management: The KCC may be involved in overseeing BigHit’s copyright management for music, videos, and other entertainment products

+ Financial Supervisory Service (FSS):

● Financial Oversight: If Bighit engages in specific financial activities, the FSS may supervise to ensure compliance with financial rules and proper financial reporting

+ Korea Fair Trade Commission (KFTC):

● Fair Trade: The KFTC may monitor to ensure that Bighit does not engage in actions that undermine fair trade

These agencies play a role in maintaining fairness, safety, and compliance within the entertainment industry If there are any violations, Bighit may face legal and financial consequences

b Interest groups

Interest groups for an entertainment company can vary, but they generally include a diverse range of stakeholders who have a significant interest in the company's activities, success, and impact These groups can include:

+ Shareholders and Investors: Individuals or entities that own shares in

the company and have a financial interest in its performance

+ Fans and Supporters: The fanbase and supporters of the artists and

music produced by BigHit are a significant interest group They contribute to the company's success through album purchases, concert attendance, and merchandise sales

+ Artists and Talent: The performers and artists associated with BigHit

are crucial interest group members, as their success directly impacts the company's standing in the industry

+ Employees: The internal stakeholders, including executives, staff, and

other employees, have a direct interest in the company's performance and success

+ Business Partners and Suppliers: Companies and individuals that

collaborate with BigHit in various capacities, such as event organizers, music producers, and merchandise manufacturers

+ Regulatory Authorities: Government agencies and regulatory bodies

that oversee and regulate the entertainment industry, ensuring compliance with laws and regulations

+ Media and Public: The media and the general public can also be

considered interest groups, as they influence the company's reputation and public perception

+ Broadcasters and Distributors: Television networks, streaming

platforms, and distribution partners that play a role in broadcasting or distributing the company's content

+ Media and Critics: Journalists, critics, and media outlets play a

significant role in shaping public perception and can impact the success of entertainment productions

+ Sponsors and Advertisers: Government agencies and local

management organizations oversee the entertainment company, ensuring compliance with laws and regulations related to content, licensing, and distribution

Balancing the interests of these groups is essential for the sustained success

of an entertainment company Effective stakeholder management, public relations, and corporate social responsibility efforts can contribute to positive relationships with these diverse interest groups