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Section 1 | Offline music industry trends
It is not that the offline kpop store has experienced negative growth every year.
Due to the small size of the market, a few albums with explosive sales results could lead to a rebound in the overall market.
In fact, according to data from the International Phonographic Industry Association (IFPI), CD sales in Korea have increased by 12%. There must have been several factors behind this rebound, such as the efforts of relevant ministries and companies to reduce the proportion of the illegal music market, as shown in the data analyzed by the association, and the release of albums by popular K-Pop idols.
However, there is one thing to note here. It is said that the domestic record sales aggregated by the International Record Industry Association is based on sales data submitted to the association by record labels and agencies. That is, the quantity distributed through the domestic distribution network, that is, the quantity produced, not the quantity actually sold.
It is based on the quantity sold by the company, which means that the quantity also includes all the quantity exported overseas through domestic wholesalers.
There are two charts that count record sales in Korea. One is the Gaon Chart, which is counted by the Korea Music Content Industry Association based on production volume, and the other is Hanteo, which extracts and estimates actual sales through devices installed in kpop stores. it's a chart
Looking at the year-end sales aggregates of Gaon Chart and Hanteo Chart, there is a fairly large difference in the sales of top albums. It is more reasonable to think that it comes from the quantity sold overseas through domestic wholesalers rather than from 'not in quantity'.
In fact, it is known that when K-Pop idols, so-called Hallyu stars, release a new product, the quantity taken from Japan or China through domestic wholesalers accounts for a significant proportion of pre-orders.

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Section 2 | Trends by kpop store industry
According to data compiled by the International Record Industry Association, domestic CD sales in 2015 were about 9.9 million, and the total sales of physical albums other than CDs totaled 10.3 million.
This is a significant decrease from the sales of 10.9 million copies (CDs) and 11.3 million copies (all albums) in 2014. On the other hand, the total of ‘400 annual album sales’ based on the sales from No. 1 to No. 400 on the Gaon Chart rose by 14%.
What stands out here is the great performance of some male idol groups. From 1st to 4th, EXO dominates, and this includes the Chinese version of the new <EXODUS>. The combined sales of these four albums are 1.38 million copies, which is a whopping 260,000 copies more than the 1.12 million copies sold in the first to fourth places on the Gaon Chart in the previous year. There is one more EXO album in the top 10, which is the Chinese version of the album <Sing For You>. The number of albums sold by EXO in 2015 is about 1.55 million copies based on the top albums on the Gaon Chart (about 1.23 million copies based on Hanteo Chart's aggregation). Based on the Recording Industry Association data that total CD sales are 9.9 million, EXO's market share is over 15.6%. Strategies to induce fans to purchase duplicate purchases by expanding the same album to repackage or special versions have already become common, but the case of maximizing domestic sales by continuously releasing Chinese versions is unusual. The performance of BTS, which sold nearly 480,000 copies of two albums, cannot be left out.
While the music market is shrinking, male idol groups such as EXO, BTS, SHINee, Super Junior, Big Bang, and BEAST are taking up an increasing share of the music market.
Based on the 2015 Gaon Chart settlement data, the total of the top 10 albums accounted for about 25% of the total album sales (the number of the music market announced by the Record Industry Association). If replacement stars do not continuously appear, there is a great risk that the domestic music market may face the sharp decline experienced in the early 2000s. Despite the increase in their album sales, the fact that the music market decreased by about 10% means that, excluding a few idols, the overall demand for music decreased significantly.
In addition, building a system that can count the actual number of albums sold in Korea, excluding exports, is still a big task. It is important to accurately understand the domestic music industry, but it will also be of great help in understanding the current status of the Korean Wave because it can estimate the increase or decrease of overseas export volume.

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Section 3 | Diversification of record formats
One of the new phenomena that has arisen as CD consumption has decreased is that musicians do not release their new work on CD, but produce and sell them on vinyl or cassette.
This is something that independent musicians in the UK and the United States have often tried before vinyl sales began to increase in earnest. In the case of the band Bullsajo, an independent band without an agency, their recently released 4th album <Korean Hip Hop> was released only on cassette, and in the process of re-release of their previous albums, they used cassette/vinyl format instead of CD to release some albums. was sold out in a short time and received a great response.
Modifiers such as 'Limited Quantity Production' or 'Limited Edition' are factors that cause buyers to make a purchase in a hurry. Since there are not many musicians who are announcing new works on cassette or vinyl yet, the promotional effect is greater, and it has the advantage of being able to generate profits within a relatively short period of time by reacting quickly to fans who were concerned about selling out.
The number of independent musicians who have released new works without releasing them and relying on formats such as cassettes/vinyls is increasing.
Soul Sauce, Taeheon, and Ha Heonjin fall into this category.
In addition to differentiating through the format, there are more and more cases of maximizing the characteristics of this format. In the case of vinyl, in addition to regular black records, limited edition records with more and more colors and designs are appearing because they can be produced with distinctive color records or by adding design elements such as heart and star shapes.
There are already several versions of the same album, with a photo book or bonus content on the CD, with names such as limited editions or repackages, but a vinyl record with a larger package is more likely to be used in that area, so thick booklets and various additional content It also offers musicians and record labels the possibility to create a variety of packages, from deluxe box sets that simultaneously contain the album to limited edition color records.
Quite a number of musicians have already released color records, from Eunji Jung and Wonder Girls to Bamjinsa and Phoenix, and Big Bang, which released limited-edition records in partnership with Hyundai Card, has published brochures with archive materials and posters using visual art works in the package. combined.
For entertainment agencies and musicians, this format provides an opportunity to expand added value through music.
If vinyl has a large package and has the characteristics of providing a differentiated sound, it is true that cassettes do not have many advantages that can appeal to consumers of the present age.
This is because the sound quality is inferior compared to CD or vinyl, and the visual content that can be contained inside is limited due to its small size. However, as we enter 2016, more and more musicians are releasing music on cassettes. In the domestic mainstream music industry, Park Jin-young released her new song <You Are Alive> on a limited cassette basis, and idol group SHINee released her new song on cassette.
In the United States, cassette consumption is gradually increasing, with Cassette Store Day modeled after kpop store Day, a successful event that triggered an explosive increase in vinyl record sales at independent kpop stores.
this also shows that more and more consumers are thinking of music as a medium for collection and collection rather than a medium for listening to music today. Many vinyl records and cassettes contain coupons (vouchers) that allow you to download music for free. This suggests that there are many consumers who want to satisfy their desire by listening to music through streaming or downloading, and by purchasing a larger vinyl or cassette that takes up less space and is relatively inexpensive when there is an album they want to physically own. It means that the producer/record company is aware of it.
Conversely, it can be said that these combined products such as download + vinyl and download + cassette contributed to elevating this format, which was somewhat unfamiliar to the younger generation, to its current position. It is still rare in Korea to release a download coupon + physical product form of an album, but it seems clear that new ideas or product demand for this format will gradually increase.
In the case of independent singer Lee Rang, when releasing her new work <God's Play>, instead of releasing a CD, she released a book containing only her own writing, illustrations, and downloadable codes.
An increasing number of independent musicians are making new attempts, such as releasing new works in the form of T-shirts + download codes, bags + download codes, etc., and such attempts are expected to increase in the mainstream music world.