Nowadays, Korean idol groups have attracted worldwide attention, and the three major Korean entertainment companies, SM, YG, and JYP, will not launch new idol groups for 5-7 years after launching each group. Although economic companies in different countries have launched their own idol groups, this market is not saturated in China. If it is not saturated, there is still the possibility of profitability. Our company is called StarNova. The core concept is to create a new generation of idols with strength and personal charm and launch a new Asian idol industry through the “customized training + full-link operation” model. Our company aims to launch two idol groups within 7 years, reach 5 million+ active fan groups, and achieve an annual income of 50 million+ for the group, promote Chinese idol culture overseas, lay out the Southeast Asian market, and promote it to Europe.
Product and Service Description
·Core Business：
Idol incubation: The idol incubation business is divided into selection and training.
– Selection: Cooperate with dance institutions, music education institutions, and music schools to hold selection activities and publicly promote the selection activities to discover new talents aged 14-22. The selection activities can refer to Korean entertainment companies SM, YG, and JYP. In the early stage, we can cooperate with bloggers who often post about idol topics in mainstream short video apps such as TikTok and YouTube to help promote.
– Training: Develop “Idol Academy” courses, which include vocal music, dance, language, and social media operations. According to statistics from Korea’s KOCCA in 2021, the average training time for Korean idols is 2 to 3 years, and the daily training intensity is 10 to 16 hours. The elimination rate of regular assessments is 30-50%. Preliminary calculations show that the training time for our idols is 2 years.
·Omnichannel Operations
Music production: Cooperate with top musicians as much as possible, launch paid listening singles after the group reaches a certain level of popularity, and monetize through the purchase of mini digital albums. They can launch physical albums if the group’s digital album sales are profitable. The following is detailed data on Idol Music’s digital and physical album sales:
Physical album:：
| Ranking | Groups/Artists | Album Title | Sales volume (10,000 copies) |
| 1 | SEVENTEEN | 《FML》 | 627.3 |
| 2 | Stray Kids | 《5-STAR》 | 523.8 |
| 3 | TXT | 《The Name Chapter:Temptati on》 | 318.5 |
| 4 | NCT DREAM | 《ISTJ》 | 410.2 |
| 5 | BTS | 《GOLDEN》 | 295.6 |
Digital album sales：
– Jung Kook’s “Seven (feat.Latto)” has been purchased over 3.2 million times worldwide (the price of a single digital album is 2 RMB)
-NewJeans “Super Shy” has been downloaded over 1.8 million times in South Korea
-IVE “I AM” has accumulated 560 million streaming plays
1. Content IP development: self-produced variety shows and promotions, short dramas and live interactive broadcasts, and filming the behind-the-scenes training process of music and music performances into short videos for promotion.
Successful cases: BTS’s “Run! BTS” has accumulated more than 500 million views (YouTube+Weverse, 2023 data), with advertising placements for brands such as Samsung and Fila with a single episode sponsorship fee of 500,000 to 1 million US dollars), and derivative peripherals (themed T-shirts, bracelets) with sales of more than 1,200 yuan), and fans have increased by more than 3 million.
2. Commercial realization: brand endorsement, fan meeting, online membership subscription (exclusive content + benefits)
Successful case: NewJeans cooperated with McDonald’s to launch a joint package. Sales in South Korea increased by 40%, and the second-hand premium of limited peripherals was 300%. The TikTok topic has been played 600 million times.
Market Analysis
Target Market:
·Core audience
12-35 years old group, based on the latest data of China’s group idol fan market in 2023:
Demographic characteristics of fans：
– Women account for 78%, and men account for 22% (data source: iiMedia Research “China Fan Economy White Paper 2023”).
– Women account for as high as 85% of boy band fans, while the gender distribution of girl band fans is more balanced (60% women and 40% men).
1. Age distribution:
– 12-25 years old group accounts for 65%, the leading consumer group
– 26-35 years group accounts for 30%, with strong consumption power, but a small proportion
Geographical distribution:
– First-tier and new first-tier cities: consumer groups account for 55% (with Beijing, Shanghai, Guangzhou, and Chengdu as the core areas in China)
– Growth in the lower-tier markets: the proportion of fans in third-tier and lower-tier cities increased from 20% in 2020 to 35%.
·Analysis of consumer behavior of audience groups
Annual expenditure from consumer
– The average expenditure is 3,200 yuan per person, and the top fans (top 10%) spend an average of 20,000 yuan annually.
– Consumption Category：
1. Albums and peripherals: 45% (the average price of a physical album is 120 yuan, and limited editions can reach 800 yuan)
2. Concerts/offline fan meetings: 30%, with single ticket spending ranging from 500 to 3,000 yuan (data from China’s ticketing app Damai)
3. Online chart voting: 15% (such as music platform charts, voting members)
·Industry Trends
– The scale of China’s idol economy will reach RMB 140 billion in 2023, with an annual growth rate of 18% (Source: iiMedia Research 2023 survey)
– Fans are very willing to pay for their idols, and 60% of users spend more than 200 yuan per month to support their idols (Source: QuestMobile)
Competitor Analysis
Main competitors:
· Lehua Entertainment: The advantage lies in its mature training system and Korean and other overseas resources. However, the disadvantage is that the artists are highly homogenized, with low music quality.
· Wajijiwa: Relying on talent shows to quickly create stars but overly dependent on a single IP, singers or idols do not have good professional resources after debuting in the company.
StarNova SWOT：
| Strengths: Differentiated training – customized courses, shortening the training cycle of trainees (targeting debut in 1.5~2 years)Flexible profit-sharing model – step-by-step artist contracts, humanized contracts to attract more trainees.Localized innovation – the group image is integrated with Chinese style and fills the gap in market affinity. | Weakness：1. Limited resources in the early stage2. Low popularity of newcomers |
| OpportunitiesMarket gap – China’s localized high-quality idol groups have a strong demandChina’s policy support – cultural export policies helpFan economy is in the development stage | Threats Intense competition Public opinion risk – Artists’ improper private lives may affect cooperative brands and lead to breach of contractEconomic fluctuations – Fans’ entertainment consumption may shrink due to macroeconomic factors |
Operational requirements
· Legal compliance:
– Artist contract standardization (including non-compete clauses and termination mechanisms)
– Copyright management: music and dance content copyright registration
· Resource integration:
– Partners: Tiktok (short video promotion), QQ Music (China’s largest music APP, exclusive audio source cooperation), YouTube (overseas stage video promotion)
– Training venue: Construction company training center (including vocal room, dance room, live broadcast space, office)
Resource requirements
· Human Resources:
-Core team: Agents (5 people), training instructors (7 people), content production team (8 people) [for the pre-and post-debut work of artists]
-External cooperation: contracted producers, stylists, and psychological counselors. [Confirm the artist’s mental health after debut, regularly understand the needs of fans, and adjust the producers and stylists. If fans are not satisfied, they need to be replaced.]
·Technical Resources:
-AI data analysis platform (annual investment of approximately RMB 500,000)
-HD live broadcast equipment
·Funding Budget
– Initial investment: RMB 20 million (about RMB 8 million for training center construction, RMB 7 million for the first group debut package, and RMB 5 million reserved for operation)
– Income sources: music share (30%), business cooperation (40%), and fan economy (30%).
Marketing and promotion plan
Phase strategy：
· Warm-up period (three months before debut):
– Release trainees’ daily Vlogs, allowing fans to discover their favorite idols’ personality charms through daily training more quickly and create a contrast between their personalities on and off the stage.
·Explosive period (after debut)
– Tiktok Challenge: Join Tiktok dance and singing bloggers to challenge group dance or song covers and win a spot in the TOP100 fan meeting.
– Cross-border collaboration: Launch limited peripherals with trendy brands (badges, limited hats, etc.)
·Long tail operation
– Membership APP: Provides exclusive highlights, online signings, exclusive voice greetings, birthday surprises, artists update their daily chats with online members occasionally, and exclusive fan live broadcasts.
Public welfare image: To enhance social reputation, participate in youth education or positive energy guidance public welfare projects.
Cost and pricing strategy
· Fixed costs: site rental (estimated RMB 1.2 million/year), equipment maintenance (estimated RMB 800,000/year). Reach a long-term cooperation with the site and equipment maintenance company and rent the site for a long time to negotiate a more suitable price.
·Variable costs: publicity and promotion costs (about 500,000 yuan per song for a single promotion), artist share. The artist and the publicity and promotion team can negotiate or exchange resources, such as signing a long-term contract, to reach a cheaper price.
Pricing Model：
· Digital singles: 2-4 yuan/song, free for members (can cooperate with music APP to guide fans to buy membership and extract share)
· Physical albums: 128 yuan (including random cards, signed posters, and random artist signatures)
· Fan membership: 30 yuan per month, 288 yuan per year (enjoy exclusive content and priority purchase of performance tickets)
Profit forecast:
-3-year goal: train and launch 1 group with 500,000 fans and 15 million yuan in profit.
-5-year goal: expand overseas markets (such as Europe, the United States, etc.), with total revenue exceeding 100 million yuan and a profit margin of 25%.
Risk Response
· Risk of losing artists: Establish a “Star Path Fund” to provide equity incentives for long-term contracted artists, or reach a resource exchange with artists to exchange better job opportunities for one person to stay.
· Public opinion crisis: Set up a 24-hour public opinion monitoring team to formulate a public relations emergency plan and regularly arrange for psychologists to talk with artists to ensure that the artists’ private lives and mental health are improved every day.
· Market saturation: Focus on vertical fields to avoid homogeneous competition.
· Artist safety: As the number of artists’ fans increases, there will be many dangers. It is necessary to promptly discover whether the artists are being followed, harassed, or otherwise troubled and threatened. In public, a bodyguard team must be hired to ensure the safety of the artists. Privately, artists must receive regular psychological treatment and examinations to ensure their physical and mental health outside of work.
· Team members must sign a confidentiality agreement with the company and keep confidentiality when particular work has not been publicly announced. Artists’ undisclosed work and undisclosed photos or videos of artists cannot be privately disseminated through any channel.
· Communication between artists and the media: When artists are interviewed, they can ask reporters for the outline of questions in advance so that the artists can prepare answers in advance. The staff must always pay attention to the artist’s answers and promptly save the situation or interrupt the artist when he/she says something wrong
Bibliography
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