Global Entry Strategy of YG Entertainment : The Glory of GangNam Style, Once Again!

This case study analyses the natures of entertainment industry (high risk-high return and one source-multi use) and star system, and examine the relationships between them. Specially, this study explores YG Entertainment, the Korea's leading entertainment company, and its global strategy based on the view of Eclectic paradigm (OLI : Ownership-Location-Internalization advantage) developed by John Dunning. Korean Wave, K-POP which hit in Asia, America and Europe, and then, now, also, South America and Middle East, boosts Korean Entertainment Industry and gives the infinite power. YG Entertainment plays a primary role to lead this wave. First of all, YG focuses on developing its own color and unique style and training to equip skills that could work anywhere in the world stage as an Ownership Advantage. And then, the firm chose the location which gives economic advantage like market size, advanced technology as a Location Advantage. Finally, YG goes abroad with the entry mode of Foreign Direct Investment(FDI) without exposing its secret know-how and firm's specific advantage as an Internalization. This global strategy has melted off with the conviction of the representatives, Yang, Hyun-Suk, with thinking that 'YG Style' would be the most competitive in the world market. This case presents significant implications for domestic entertainment industry which prepare for global strategy systematically, and it provides theoretical and practical insights in terms of understanding of the difference between entertainment sector and traditional industry based on manufacturing of the factory.