SEOUL, July 22(Korea Bizwire) — South Korea’s K-pop industry is facing mounting concerns as both album exports and sales declined in the first half of 2025, signaling a broader slowdown in a market once considered resilient to global economic headwinds.
Even Japan — historically K-pop’s strongest overseas market — saw reduced import volumes, prompting calls for diversification through new intellectual property (IP), merchandise, and live performances.
According to data released by the Korea Customs Service on July 20, K-pop album exports between January and June fell 11.6% year-on-year to $114.4 million. This marks the second consecutive first-half decline, following a peak of $132.9 million during the same period last year.
Japan remained the largest importer at $39.1 million, followed by China ($20.1 million) and the United States ($19.5 million). Notably, exports to China increased by 9.3%, while shipments to the U.S. plummeted 36.1%.
The downturn isn’t limited to physical exports. Circle Chart data shows that physical album sales (Top 400 titles) dropped 9% year-on-year to 42.5 million units, while digital streaming activity decreased by 6.4%.
Industry experts point to saturation and growing local competition in Japan, long considered a reliable market for K-pop. Exports to Japan dropped 15% in the first half, outpacing the overall decline. The number of K-pop albums in Oricon’s top 25 halved from 12 last year to 6 (excluding Japan-based K-pop-style acts like INI and JO1).
Music analyst Kim Jin-woo noted that domestic Japanese acts have improved in production quality and now pose credible competition. “If Japan is no longer a guaranteed market, that poses a long-term strategic risk,” he said.
He also pointed out that many “local-style” groups created with Korean expertise and operating under foreign labels don’t count toward Korea’s official export figures, even if they carry the K-pop DNA.
Insiders caution that aggressive pushes into Japan may have overshot actual demand. “Joint K-pop concerts stopped selling out last year,” said one executive familiar with the market. “Everyone jumped in assuming the demand was infinite, but fans are reassessing their spending.”
Looking ahead, the industry is hopeful for a rebound with the return of megastar acts like BTS and BLACKPINK. Their absence in the first half was felt acutely. “Sales slumped partly because top-tier artists were inactive and fan events like signings lost momentum due to negative publicity,” said Choi Kwang-ho, Secretary General of the Korea Music Content Association. “BTS’s return in spring 2026 could trigger a positive ripple effect.”
Still, voices in the industry emphasize the urgent need to cultivate next-generation “super IPs.” One major agency official stressed, “We need IPs that break through personalized consumption and connect emotionally — like the hypothetical ‘K-pop Demon Hunters.’ Merchandise and concerts should also become stronger revenue streams.”
Lina Jang (linajang@koreabizwire.com)
