Evaluation on Attractiveness of a New Marketplace: Disney’s New Journey to South Korea

This paper suggests The Walt Disney Company should expand its retail business to South Korea. The company’s revenue mostly comes from the U.S. and Canada. The concentrated operation in North America makes the company vulnerable to market changes. As a result, the intense competition in the entertainment industry in North America undercuts the company’s competitive edge. In 2016, South Korea’s Gross National Income (GNI) ranked 47th among 217 countries; it was $35,790 PPP, which increased steadily in the last seven years by 27%. GNI per capita measures the domestic residents’ financial ability to buy various goods and services. This index shows that South Korea has a great market value for expanding Disney’s retail business. The business potential of a Disney Store in South Korea is demonstrated by the following factors: Market Value of the Cartoon Character Business in South Korea. Kidult culture is a new trend in South Korea; “kidult” refers to adults who like to purchase character products that are generally catered to young kids. With the kidult culture booming, character merchandising has become remarkable in the cartoon character business. Many businesses such as those in the food, cosmetic, and financial industries have started diving into character merchandising. Character merchandising in South Korea is the highest value-added business. The character market is expected to continue growing. Popularity of Disney Characters in South Korea. In South Korea, every recent Disney movie has been a box-office success. For example, Frozen has become the second most-watched foreign movie in South Korea. With most of the market share in 2016, the Disney company continues to be the most popular foreign film production company in South Korea. Merchantability of Licensing of Disney Characters. Licensing of Disney characters has been proving its merchantability in South Korea. Many cosmetic, jewelry, and clothing businesses found the commodity value of Disney products profitable. Recently, these companies started to license contracts with the Disney company, and all Disney character products have brought large profits to these companies. The data used in this paper is retrieved from the Korean Film Council (KOFIC), the Korean Creative Content Agency (KOCCA), and media companies. The company information is provided by the company’s official website and scholarly articles.