"Strategic Investment to Strengthen US and Global Business"
JYP Entertainment has recently confirmed an additional investment of $3 million (approximately 4.2 billion KRW) into its North American subsidiary, JYP USA. This is the first additional investment since the establishment of the North American branch in 2022. This strategic move is interpreted as an effort to discover new artists and expand its presence in the North American market, building on the success of popular artists such as Stray Kids and TWICE.
According to JYP on the 22nd, the board of directors recently approved the $3 million investment. A JYP official stated, "This is a strategic investment to strengthen our business in the U.S. and globally," adding, "We plan to focus on market expansion through localization."
JYP USA supports the U.S. activities of its artists, including TWICE and Stray Kids. In particular, it has strengthened music distribution and promotional activities locally through a partnership with Republic Records, a leading North American record label.
The reason JYP is focusing on the North American market is due to its high profitability. For tour performances, costs include venue rental fees, personnel expenses, production and technical costs, insurance and taxes, and visa issuance fees, amounting to approximately $500,000 to $1 million per show. Stadium-level concerts can cost several million dollars. Despite these high initial costs, successful tours in the U.S. generate revenues that exceed these expenses.
Last year, TWICE achieved great success by attracting 250,000 attendees through a total of 13 performances in 9 North American cities. They became the first female group worldwide to perform at the LA SoFi Stadium and New York MetLife Stadium, both of which have a capacity of 50,000 seats and were sold out. The U.S. music media Billboard estimated through its 'Boxscore' chart that TWICE's North American tour generated approximately $24.2 million (about 33.5 billion KRW) in revenue. This explains why they cannot stop their expansion into the U.S. despite the enormous costs.
The purchasing power of the U.S. market is also significant. According to an annual report released by Luminate, a U.S. music market analysis firm, Gen Z K-pop fans in the U.S. spend about $24 (approximately 30,000 KRW) monthly on merchandise. This is 2.4 times higher than the average monthly spending of general U.S. music listeners and $8 (about 10,000 KRW) more than J-pop fans. K-pop fans are also reported to be 50% more likely than general listeners to purchase artist-related products even if they cannot attend performances in person.
The free market environment is an advantage of the North American market. By collaborating with local promoters such as Live Nation, revenue can be maximized through ticket sales, merchandise, and VIP events. Tour schedules and marketing strategies can be flexibly adjusted to suit local conditions, demonstrating excellent market adaptability. In contrast, the Chinese market, which was a major revenue source for K-pop in the past, had many restrictions such as requiring government approval for each performance schedule. An industry insider evaluated, "Although the North American market initially requires large capital and local networks, success greatly contributes to expanding the global fandom and enhancing the brand value of the agency."
A company official said, "This investment will contribute even more to broadening the market entry possibilities for new artists."
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