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Overseas Marketing Suggestions for the Korean Animation Industry

While Korea is recognized as a world animation power, she is not known to have creative control over the projects on which she works. Now could be the right time for Korean companies to change this role. Joe Jo suggests a few tactics.

Turtle Hero is just one of the many feature productions coming out of Korea. © Hahn Shin Corporation.

For many years, Korea has been recognized as a peculiar country in that she is famous for her experienced animators and has participated in many of the global animation industry's projects. However, she has remained predominately a work for hire location used by Hollywood and Japan. Now could be the right time for Korean companies to change their role. In the 1990s, there were many projects which Korean companies produced from their own creative ideas; so far they have not been so successful. However, upon seeing that many Korean companies are still launching new projects, they seem dedicated to broadening the domestic industry's horizon. For their success, I would like to make a few suggestions about the overseas marketing/fundraising techniques used by Korean animation companies, as this is the key to opening a better future. The Need To Reach Out Basically, the reason why the Korean animation industry requires "overseas marketing" is because the Korean domestic market is not big enough to compensate for a production's expense. International sales must be obtained to make ends meet! In Korea a standard animation series for television (30 minutes x 13 episodes) requires an investment of around US$2 million, and an animated feature film destined for theaters requires the same. However, most of the time, it has been difficult to earn back the original investment of $2 million solely in the Korean market. The licensing rights for free network television sell at the low price of $100,000 to $200,000. Video rights sell at around $100,000, and merchandising rights cost around $500,000. Usually the sum of the income is $2 million at best. Furthermore the prices are never guaranteed as the animation film business is part of the unpredictable entertainment business. Therefore, if Korean animation companies want to earn a stable income from their creative projects, there is no way but to develop the overseas markets. However, the animation companies of Korea do not seem to deal with this fact properly. Although Korean animation companies have experienced overseas sales over the last 10 years since the television animation boom began in the late 1980s, their projects have hardly succeeded in the international film markets. Because Korea's animation companies have been predominately "work for hire" for foreign studios for such a long time, they couldn't quickly adjust in the 1990s to become creative animation studios as lead by the Korean broadcasting networks. Korean animation companies need to take a systematic approach to overseas marketing, for only an organized approach will ensure a stable income from now on. Needless to say, "pre-sales" are the most important strategy in overseas marketing for countries like Korea, as pre-sales are not only the way to reduce the possibility of failing in the market, but also help to estimate demand in the market. Therefore whoever desires stable income in the animation business had better give up the project, especially in South Korea, unless he can substantially pre-sell the work in overseas markets before production begins. However most projects in Korea have been made without international pre-sales, which is like walking toward a cliff with closed eyes. Yonggary, a 3D theatrical feature that stars a dinosaur of the same name, is the exception which I have seen in Korea. It made the newspapers and broadcasting networks because everyone in Korea was surprised that it had procured $3 million from overseas markets, before they had even finished the production. Unfortunately, it was a good attempt, but not an excellent final product. The story's ending fell short of the industry standard. Bungabu is another example of successful overseas marketing. Bungabu is a 3D CGI animation series for television (30 minutes x 26 episodes). The producers have been trying to promote the show at international markets like MIP-TV for the past 3 years, while making a special feature film version for KBS (Korea Broadcasting Systems).

A scene from Tooniverse's TV series Bungabu. © Tooniverse.

Working Together Internally

If the "relatives" of the Korean animation industry were convinced of its serious standing in the world community, I would suggest that these large corporations utilize their competent agents for overseas marketing help. Several tries to accomplish this goal were made by the subsidiary companies of the "Chaebol" (large Korean companies like Samsung, Hyundai, LG), but most of these companies retreated from the entertainment business in the late 1990s due to the Asian economic crisis. All except one, that is. Diamond Ad Ltd., the advertising division of the Hyundai Group, has not only worked for a number of recent animation projects in Korea, but has acquired experience and knowledge for overseas marketing through their other projects with multiple international partners. As the field of overseas marketing is still in the developmental stages in Korea with the high probability of progress, the new companies that join the field could find a niche for themselves without much difficulty. Several new companies, like Mirror Vision, have come out as specialists in overseas marketing. They have successfully exported several films, so I hope these young focused companies will take action in the animation realm.

Milo's Great Adventure was able to make it to the small screen with help from Western investors. © Sunwoo Entertainment.

Another important key to overseas marketing is "the big productions." As I have mentioned, most productions in Korea are usually on a "work for hire" basis, and there are always several big productions going on in Korea. Even though Korean companies have not been able to apply themselves in overseas marketing, they have an advantage in that they are linked to the major studios in Hollywood and Japan. Since the beginning of the Korean animation industry, they have had the potential to build bridges to the overseas markets by these links. It would be very helpful if they developed a way to connect their creative projects with the major film or animation companies to which they are related. There are currently several attempts to accomplish this goal in progress. Sunwoo Entertainment is making the TV series Milo's Great Adventure, in cooperation with Fremantle Corporation of America for worldwide distribution. Dong-A Export Co. Ltd. of Korea co-produced Gundress, a theatrical animated film, with 5 companies in Japan. Hahn Shin Corp. is another example of a company actively pursuing overseas opportunities. Mr. Peter Choi, the CEO of Hahn Shin, was a director in the Daewoo Corp., which is well known for all of its products, and for its enthusiastic presence in international trade. This makes Hahn Shin very competitive in overseas marketing and has definitely influenced Hahn Shin to be a more active overseas marketer. Turtle Hero, Hahn Shin's theatrical feature project, will set a record by getting the highest amount of funding for a Korean film project in the international pre-sale film markets.

New Technology

The role of Korean studios in the global animation industry could be specialized more positively to influence overseas investors. Some predict the Korean animation industry will succeed the Japanese cel animation one and get a large portion of the traditional cel animation market, because now the Korean companies have experience in the planning process of their own numerous creative projects. Others say the Korean animation industry has an edge in 3D animation production, so it is not too late for Korean companies to participate in this field and be both economically and technically competitive. The animation industry in Korea has flourished due to the competitive pricing that drives the animation production field. In the traditional cel animation market however it is getting harder and harder for Korean companies to compete with China and other South Asian countries. However it is reasonable that Korea will keep the edge in 3D animation production because the technology will function as an entry barrier against those other countries. Moreover, animation companies can take advantage of government support for multi-media projects including 3D computer graphics. Government support has grown from the fact that 3D animation and special effects shots will glean bigger profits to the animation industry than the traditional cel animation has done in the past. Now creative ideas and advanced technology is more influential to the field than solely labor. As high quality productions are more desirable to the overall industry structure, animation companies should infuse their own projects with new technologies in order to enter this market.

Mulan screened with mixed results in Korea. © The Walt Disney Company.

Opening Markets

Korean animation companies should pay more attention to theChinese market because they have the same cel animation advantageslike "good quality labor at a low wage" as Korea usedto have. Lately, we have been losing this advantage. Korean companies have abundantexperience in production and should co-operate with Chinese production houses. As the Chinese economy grows, the Chinese market will become formidable in the new millennium. Major Hollywood studios are already trying to grasp the Asian market as in the case of Disney's Mulan (1998). However, Mulan was not as successful in Korea as Disney had hoped. This was mainly because the storytelling and expressions used were different fromthe Asian way and it made the audience refuse the story. For the Hollywood studios, Korean companies have a geographic and cultural advantage over the Chinese. Therefore, it is easier for Korean studios to make more economical and interesting productions than Hollywood. Korean companies should keep their steady approach and co-operate with the Chinese in this market. Due to Korea's long animation production history, it is highly possible for Korean companies to succeed in this market more than the other countries. Since the early `90s, it has been predicted that "work for hire" projects will disappear from Korea and move to China. However, here we are in the year 2000 and there are still many "work for hire" projects in Korea. This may give members of the Koreanbusiness community a feeling of security, like they do not haveto change their procedures quickly and risk a few unpredictable bumps in the production road. However, Korean animation companies cannot help but to innovate and reinvest a part of their profitsfor the future. The only way to secure the survival of the Korean companies in the competitive global animation industry is by fresh ideas and digital technology. Joe Jo is a freelance writer who has previously worked as a producer at Tooniverse Inc., the Korean animation channel. In addition, Jo has produced three animated short films.