Cultural value

South Korea’s growing allure

Kim Soo-hyun w

Park thinks it’s better in China

He may have come from the stars but Korean actor Kim Soo-hyun now finds himself spending most of his time in China. Kim, who has seen his popularity soar after the TV series My Love Who Came From the Stars became a hit, has reportedly signed as many as 16 endorsement deals in China and has been booked to attend 58 commercial events (and counting).

Kim’s agency Keyeast announced that he is endorsing Samsung Electronics in China and that he has signed with Hyundai Motors to promote its ix25 model. Kim is also being used by brands like Coca-Cola and Haagen-Daz, as well as the local firm Evergrande Water (a bit more controversially, see WiC243).

It is estimated that these deals have earned him at least Rmb110 million ($17.9 million), three times the amount he has made at home.

Park Chae-rim, who became popular for her roles in South Korean hit series like Loving You (1999) and All About Eve (2000), also spends the majority of her time in China, where she has been working since 2003. The actress, 35, is also engaged to Chinese actor Gao Ziqi.

“Like the Japanese, South Koreans understand that they have a small population and a narrow market. Both the stars and their agencies want to expand their overseas appeal,” Fan Xiaoqing, a critic who focuses on South Korean dramas, told the China Daily.

China’s interest in Korean exports doesn’t just apply to TV celebrities. South Korea’s efforts to promote closer relations with China are bearing fruit (see WiC245). According to the Economic Observer, Chinese investment in South Korea reached $708 million in the first half of the year, an increase of almost seven-fold over the same period in 2013. That surpasses the full-year total for last year, when Chinese companies invested $480 million. The Economic Observer reports that most of the capital went into real estate. Take Jeju Island, where land owned by Chinese investors reached 5.9 million square metres in June from just 2,000 square metres in 2009 – an increase of almost 300 times. There has been a surge in the value of properties owned by Chinese investors on the resort island too – up a massive 1,450 times over the period, from $380,000 to $564 million, the Chosun Ilbo reported.

Analysts say many Chinese investors have purchased properties in Jeju to take advantage of an immigration scheme. In 2010, the South Korean government introduced permanent resident visas to foreigners who invest in Jeju real estate. Chinese citizens also like the island’s proximity to China – it is only a one-hour flight from Shanghai – as well as to its mild climate and good healthcare facilities, the South China Morning Post says.

But the appeal of Korean pop stars like Kim is also attracting interest from Chinese businesses. In the first half of the year, Chinese investment in South Korea’s cultural sector was up nearly twentyfold. Sohu has announced that it invested $15 million for a 6% stake in the South Korean management agency Keyeast (which represents Kim), for instance, while search giant Baidu revealed in May that it had signed a strategic deal with SM Entertainment to licence the South Korean firm’s music and videos in China (SM Entertainment is behind the band Girls’ Generation, which is popular across much of Asia).

China is already the biggest consumer of Korean cultural exports and the Chinese account for a third of the 1.5 billion viewers of South Korean drama around the world, according to the Korea Trade Promotion Corporation. Given that level of interest, it’s little surprise that South Korean firms are taking a page out of Hollywood’s playbook and incorporating more Chinese elements into some of their TV series. Zhang Liang, a Chinese actor, recently starred in Doctor Stranger, one of the Korean dramas. The show, which received a lukewarm reception at home, went on to attract 400 million views on Chinese online video sites. Another series, named You’re All Surrounded, didn’t feature Chinese actors. But a number of Chinese brands – ranging from cosmetics to cars – all made an appearance. “After You’re All Surrounded, two more shows will also have Chinese product placements. In the next five years, we believe that Korean TV series will become the first choice for many Chinese brands to advertise. And besides, the possibility of Korean drama being banned in China is very low since they are mostly romantic dramas that appeal to all demographics,” an industry insider told Jingling Evening News.

© ChinTell Ltd. All rights reserved.

Sponsored by HSBC.

The Week in China website and the weekly magazine publications are owned and maintained by ChinTell Limited, Hong Kong. Neither HSBC nor any member of the HSBC group of companies ("HSBC") endorses the contents and/or is involved in selecting, creating or editing the contents of the Week in China website or the Week in China magazine. The views expressed in these publications are solely the views of ChinTell Limited and do not necessarily reflect the views or investment ideas of HSBC. No responsibility will therefore be assumed by HSBC for the contents of these publications or for the errors or omissions therein.