How Major Musicians like BTS and Harry Styles Protect Their Brands

As the music industry grows, and major stars like BTS and Harry Styles explode in popularity, it has drawn an increasing interest from profit-seeking counterfeiters. In this article, we'll look at how some of the music world's biggest acts are protecting their IP.

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Fans have the ability to turn artists into superstars. They spend billions each year to have a piece of their favorite artists’ brilliance with concert experiences, merchandise, streaming, and countless other revenue streams.  They develop emotional attachments and feel as though they know and understand the details and inner workings of a star’s life. Think of the Swifties who analyze every word of every song or the highly organized BTS ARMY. 

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At the peak of their success, artists become brand themselves. As they do, new threats to their reputation begin to emerge. IP theft can rapidly become a substantial issue for artists.

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Counterfeiting is projected to reach nearly $3 trillion in 2023, up 50% this year, as fake merchandise infiltrates marketplaces worldwide. IP theft is also experiencing a dramatic rise, with bands’ likenesses and/or their artistic work frequently becoming fodder for knock offs, spoofs, or unlicensed products which artists neither approve nor profit from. The proliferation of digital content and images, combined with the explosion of online marketplaces and lower manufacturing costs, make for fertile ground for bad actors to sneak a cut of an artist’s profits

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To illustrate the brand potential of modern artists, let's take a look at BTS, the South Korean boyband that's had a major impact on modern pop culture for the past decade.

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Putting it in Perspective: The Business of BTS

K-pop has become increasingly visible to a global audience over the past 5-10 years. Since 2009, at least 20 K-pop artists have hit the Billboard Hot 100 chart, and the export of K-pop has ballooned South Korea’s music industry to an impressive $10 billion industry. As a testament to Korea’s hunger for K-pop, the country experienced a 44.8% increase in music revenues between 2019-2020. For comparison, the U.S. saw a 7.4% increase during that same period.

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Driving the K-pop wave is BTS, which is single handedly responsible for contributing a whopping $3.7 billion as of 2020 to Korea’s economy between album and ticket sales, merchandise, and attracting visitors to the country. This represented 0.2% of the GDP, placing it in rarified air with corporations like Samsung (15.3% GDP), Hyundai (5.9%), LG (3.3%) and Korean Air (0.4%). BTS are some of the world’s biggest leaders of the new fan economy.

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The group’s legions of fans, known as the ARMY, consider the BTS members to be as close to them as their best friends. They feel a genuine connection to the band, and feel that their experiences and difficulties in life are truly understood by the artists . Interestingly, at the core, this devotion of fans to the band is the result of a deliberate strategy to build psychological intimacy between artist and fan set out by BTS’ management company, Hybe. 

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Leveraging storytelling marketing, Hybe has been making artists and music a powerful source of IP assets with scalability. They craft stories that fit each artist’s character and concept. 

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If K-pop from previous generations relied primarily on revenues from copyrighted properties such as songs, lyrics, instrumentals, music videos, choreography, endorsements, and promotional material, the BTS generation is extending product offerings by exploiting diverse IP rights. For example, each album is organized within the artist's overall story, and this storytelling is actively used for other content such as novels, webtoons, movies, and games. This strategy provides the foundation for diversifying revenue streams. In addition, HYBE operates a global fan community platform, Weverse, and a fan commerce platform, Weverse Shop, to allow fans to share information and purchase artist-related products. 

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Aside from copyright income from music and video streaming and sales, K-pop companies boost their outcome through licensing trademarks and copyrights in brand partnerships for games, clothes, and more, making the most of their intangible assets through IP strategies. In simple words, HYBE has positioned itself as a “content creator” in the vein of Disney, with BTS essentially playing the role of Mickey Mouse. 

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A notable example is BT21, a partnership between LINE FRIENDS Corporation and Big Hit, which has its own IP subsidiary to manage license transactions. The BT21 project consists of fictional characters created by the seven members of BTS to stamp stationery, clothes, shoes, food and beauty products, among others. The BT21 brand has partnered with dozens of other brands around the world, such as Reebok Korea, Dunkin’ Donuts Korea, Olive Young (South Korea), Converse (USA), Anti Social Social Club (USA), Riachuelo (Brazil), Uniqlo (Japan), NEIGHBORHOOD (Japan), and more. In 2021, BTS registered more trademarks with the Korean Intellectual Property Office than any other pop group. Out of six sales categories – music album, contents, IP licensing, advertisement, fan club, and concerts – Contents and IP licensing together generated more than 50% of the entire revenue.  

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With all of this going on– and now being replicated by other K-pop artists, it’s not hard to imagine the temptation for IP theft. Securing even a fraction of revenue from one band’s stolen IP could net quite a payday. Then amplify that by multiple artists and a whole new, albeit criminal, industry is thriving.

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Burgeoning Opportunity for Artists

Popular western artists, particularly in the U.S. and U.K., and their management firms have learned a great deal over a very short period from Korea, and they are putting it to work with their own spin.

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While there may not be an ARMY, there is Rihanna’s Navy, along with the Swifties (fans of Taylor Swift), the Beyhive (Beyoncé), the Bardi Gang (Cardi B), Beliebers (Justin Bieber), Little Monsters (Lady Gaga), Hooligans (Bruno Mars) and so many more. Merchandise, branding opportunities, new types of fan experiences, and strategic creative collaborations (think Travis Scott’s shoe collabs with Nike) are picking up significantly. Many artists are starting their own fashion lines to capitalize on their fandom– Savage X Fenty, House of Dereon, L.A.M.B., Billionaire Boys Club, and so many more. In short, “merch,” especially vintage or limited release items, has become big business, netting artists comparable revenues to what they earn on tour for a limited time investment– all while delighting their fans.

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The fan economy in the U.S. may not have reached the heights of what is being experienced in Korea just yet, but it is coming as more and more artists delve into new channels for connecting with fans.  So how can artists get ahead of the curve and protect themselves from counterfeiting and IP theft? 

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What Artists Need to Know

IP protection is one of the most difficult issues to solve because not only is it very difficult to prove who owns content and images on the Internet, but copyright laws were not designed for the world of the modern fan economy. Nevertheless, they are now being tested in the courts, with the onus of protecting IP and brand identity now in the hands of the artists and their labels.

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For example, in early January, Harry Styles filed a lawsuit against online sellers in an attempt to stop counterfeiters from selling fake goods. The suit states, “Plaintiff is forced to file this action to combat defendants' counterfeiting of its registered trademarks, as well as to protect unknowing consumers from purchasing counterfeit products over the Internet.” It notes that many of the goods come from China but are sold via websites that make them look authentic, like Amazon and Etsy. This is not at all uncommon. In a recent MarqVision survey, 56% of respondents from top brands have found counterfeit products listed with third-party vendors on major online marketplaces like Amazon and eBay.

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The Styles filing highlights one of the key issues artists face, with the singer’s management company writing, “Tactics used by defendants to conceal their identities and the full scope of their operation make it virtually impossible for plaintiffs to learn defendants' true identities and the exact interworking of their counterfeit network.” Savvy sellers have become experts not only in creating fake merchandise but evading prosecution.

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In another, increasingly common scenario, BMG sued a toymaker for using a parody (My Poops) of the Black Eyed Peas song My Humps to market and sell the Poopsie Slime Surprise doll– a unicorn that excretes green slime. Will.i.am– nor the management company– could not be happy about that– as the song was not approved for use of this nature.

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Artists create IP, assuming they own at least part of it (with fans and management companies also attaching themselves). So how are they to be protected?

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The answer is in constant vigilance. Among the teams of people on the payroll, someone needs to be monitoring all corners of the Internet to ensure that brand integrity is maintained so that fans are not cheated– and neither are artists or management companies. But this is extremely difficult to do. In the MarqVision survey, brand respondents indicated that their biggest challenges are finding counterfeits and having the internal resources to monitor them. Locating fake listings across thousands of online sites and marketplaces has been overwhelming, and organizations are not equipped for staff to scan and monitor for fake products in a meaningful way.

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Fortunately, artificial intelligence is advancing to the degree that it can now recognize fakes – whether it be images, merchandise, voices, words, or videos. Once flagged, humans can review them. If a fake or “fair use” violation is detected, a human or an intelligent system can work to get it taken down or returned, sometimes near instantly, sometimes after a protracted battle. This is the initial stop gap – one that K-Pop stars are already mastering.

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What comes next will be the need for new protections of IP. Laws have to be adjusted, and artists need to use their voice to ensure that this happens. They also need to leverage technologies that can verify ownership of IP in every market across the globe. Establishing ownership will be essential in the fight for brand protection.

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U.S. artists need to be thinking about this now to get ahead of the situation. Or else they risk millions of dollars and loss of the branding they, and their teams, spent so long cultivating.