Estimating the Price of Fanatism: A Case of Indonesian K-Pop Merchandising Market

There had been few prior research in Indonesia that has given insight and overview into the K-pop merchandising market landscape. However, none of them took pricing on K-pop merchandise into perspective. Thus, this article attempts to answer research inquiries about the overall K-pop product market through the role of pricing. To limit the study, only two different types of K-po signature merchandising were examined in this research namely album bundles and lightsticks. Using the Van Westendorp’s model, this study tried to find out the fans’ acceptable price range. Using self-completion online surveys, this study managed to explore both items’ acceptable price ranges. Among 200 respondents, both merchandises’ acceptable price range were clustered closely to the local e-commerce’s price range rather than its official distributor/seller website. The album bundling price range were scattered between IDR 245,000 (≈USD 15.83) to IDR 375,000 (≈USD 24.23) per bundle. Meanwhile, the lightstick was around IDR 465,000 (≈USD 30.04) – IDR 700,000 (≈USD 45.23) per item.


INTRODUCTION
Optimal discrimination theory helped to explain the degree of importance of owning merchandise and memorabilia for fans, especially for K-pop (Korean Pop) fans.It shows that an idol/group's symbol has been used as part of fans' fulfilment needs: an individual's self-concept and their belonging to a social group (Geraghty, 2014;Chan et al., 2012).Using symbols in the form of merchandise and similar fashion items with their idol is their way to show their loyalty toward their idol as well as a way for them to form social bonds within the fan community.It is also the same medium for fans to show their uniqueness and stand out as true-fans in bigger community groups.
In the case of K-pop idols, most of their fans also considered their idols as a fashion lexicon with their one-of-akind unique look and fascinating fashion sense (Kandangwa, 2023).Thus, creating a bigger need for fans to mimic their idol's fashion sense and items, aside from their need to stand out.This is greatly supported by previous research on the notion that the more substantial the identification of fans, the more they are invested in using idol/group symbols (Jones, 2015;Plante et al., 2014;Chadborn et al., 2017).Chin and Morimoto (2013) also found that fellow fans bonded through moments of closeness within their fans' group (fandom) and transcultural objects.The latter is then translated into the act of collecting merchandise/ memorabilia and driving the high frequency of usage and buying of collectable idol goods (merchandise and memorabilia).This phenomenon also shifts fans' buying behaviour on cultural products and in return creates a fans economy, where consumption is a medium to show their dedication and emotional identity of their close-knit community (Cicchelli and Octobre, 2021;Liao, 2021).This fan economy has driven the merchandising market to become a segmented yet lucrative business across the globe, becoming a transnational phenomenon (Yoon, 2022;Oh, 2017).Previous studies on other sectors, like sports and movies, have shown that this type of fan economy has driven merchandising prices unrealistically high and yet fans still show a willingness to pay even more (Javani, 2012;Özer & Tokay, 2006;Affuso & Santo, 2018).This occurrence also happened in K-pop merchandising, where fans felt that the current price was unreasonably high, yet they were There had been few prior research in Indonesia that has given insight and overview into the K-pop merchandising market landscape.However, none of them took pricing on K-pop merchandise into perspective.Thus, this article attempts to answer research inquiries about the overall K-pop product market through the role of pricing.To limit the study, only two different types of K-po signature merchandising were examined in this research namely album bundles and lightsticks.Using the Van Westendorp's model, this study tried to find out the fans' acceptable price range.Using self-completion online surveys, this study managed to explore both items' acceptable price ranges.Among 200 respondents, both merchandises' acceptable price range were clustered closely to the local e-commerce's price range rather than its official distributor/seller website.The album bundling price range were scattered between IDR 245,000 (≈USD 15.83) to IDR 375,000 (≈USD 24.23) per bundle.Meanwhile, the lightstick was around IDR 465,000 (≈USD 30.04) -IDR 700,000 (≈USD 45.23) per item.

Malaysian Journal of Business, Economics and Management
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Merchandise Consumer Research Van Westendorp Model Willingness to Pay
still lined up to buy their idols' goods (Sanghvi, 2022;Yusron, 2022).This seems to be an adversary with the price sentiment; a theory where price is one of the powerful tools to affect consumers' minds in terms of buying behaviour since it is one of the visible attributes of a product (Silkoset, 2023;Ceylana et al, 2014).Price has proven to incite market demand, resulting long long-term profitability since it is the only element in the marketing mix that is closely associated with revenue (Ceylana et al., 2014;Kotler et al., 2016).The price is more likely than not to reflect the value of the product.In the case of K-pop fans, fanaticism has been weighing greatly in terms of the value of the merchandise.It is creating insensitiveness in the pricing of the product itself.Even so, for Indonesian fans, counterfeit merchandise, that has been sold largely in the local e-commerce market, came into play.This counterfeit (unofficial) merchandise was sold cheaper and widely distributed among Indonesian K-poppers.As selling unofficial merchandise became a common trend, it has become a significant threat for K-pop agencies to market their official products/merchandise in Indonesia (CNBC Indonesia, 2022).Accordingly, this creates competition whereas counterfeit merchandise offers the same value and yet gives far more competitive prices, resulting in a more price-sensitive market.The official merchandise distributor could take action against these perpetrators, those who sell counterfeit merchandise, through legal means, but this would be a gruesome and long battle for them.This step may reduce the sales rate of counterfeit products but will not completely remove them from market circulation considering the large number of counterfeit perpetrators in local e-commerce.These make pricing a crucial tool for the official distributor despite the great weight of fanaticism.
There are limited previous studies in Indonesia that took a close look and deep-dived discussion on the K-pop merchandising market landscape.However, none of them actually took pricing on K-pop merchandise into perspective.Previous research mostly took perspective on fans' buying behaviour, consumption patterns, and psychological well-being (Zakiyah, 2022;Fadillah et al., 2022;Haryono & Sihombing, 2018).In this regard, this paper tries to address the calls for research on the overall K-pop merchandise market through the role of pricing, giving a better understanding of fans through the perspective of price sensitivity.This paper will also give a good starting point for merchandise stakeholders (distributors, policymakers, Korean entertainment agencies, K-pop enthusiasts, etc.) to better understand the K-pop market in Indonesia.

LITERATURE REVIEW
Van Westendorp's model is the most common approach used to explore consumers' willingness to pay for products.It provides elaborate open-ended questions to potential buyers using direct questioning methods (Sillkoset, 2023;Lipovetsky et al, 2011).This direct method of questioning is fitting to evoke buyers' valuation of products by providing a range of price levels in which they are willing to pay.The latter is also one of the main rationales for why this approach is widely used in the commercial market and corporate setting aside from its practical application and data robustness.
The Van Westendorp method was built on the assumption that there is a range of prices that buyers were willing to pay based on the perceived quality that they received (Sillkoset, 2023;Lipovetsky et al, 2011).The range of price itself is measured through four essential pillars of questions: (1) too cheap -product's price that is low enough that buyers start to question its quality and not consider buying the product; (2) cheaplow price where buyers thought that buying it is a bargain; (3) expensivehigh cost for buyers but still affordable enough to be considered to buy; and (4) too expensivea very high cost that buyers would not consider to buy.
The four questions then accrued its frequencies which are later plotted into curves for analysis, generating 4 different curve lines that cross one another.According to Sillkoset (2023), the latter then used to identify four main essential price points that are used for setting acceptable price ranges: 1. Point of Marginal Cheapness (PMC) is the intersection between "too cheap" and cheap curves.This is the lowest point of acceptable price.This indicates that any price level below this point led consumers to doubt the quality of the product itself, resulting decrease in sales.

Point of Marginal Expensiveness (PME) is the intersection
between "too expensive" and "expensive" curves.This is the highest point of acceptable price for buyers.This indicates that any price level of this point has driven buyers to question its worth.Most of the products with prices above this point are deemed overpriced.3. Optimal Price Point (OPP) is the intersection point between "too cheap" and "too expensive".This is an optimal point of price level for sellers.This point embodies a maximum number of buyers that consider the maximum level of acceptable prices while still considering the product as a bargain.Buyers also have minimum resistance to price changes compared to the previous two points.4. The indifference Price Point (IPP) is the intersection point between "expensive" and "cheap" curves.Reflecting its name, this intersection point is the median price level where buyers felt indifference toward the price level, not too expensive nor too cheap.Buyers considered this as the normal price market (Arru, 2022;Sillkoset, 2023).

METHODS
In order to limit the study, only two different types of merchandising were examined in this research namely album bundles and lightsticks.These two items were what set K-pop apart from other forms of products or memorabilia sold in comparison to other entertainment sectors.The majority of merchandising for movies, sports, or even similar music industries (non-K-Pop) stayed close to run-of-the-mill mugs, articles of clothing, and dioramas; not that the K-pop industry selling those items either.K-pop agencies were the only ones providing special record/album bundles, including a small pack of photocards in the bundle, and lightsticks that were customized for each promoting idol.Other than their distinctive identifier characteristics in the merchandising market, these two products also have stable price levels (official merchandise) over time compared to other types of merchandise such as photo cards and photo albums.
This study employed an online survey using Google Forms.It comprised three parts that covered (1) questions on demographic data, (2) questions on fans' willingness to pay for album bundles and, (3) questions on fans' willingness to pay for lightsticks.Using a chain-referral method for sampling, there were about 5 different online K-pop fandoms (fan communities) were contacted as the focal point for spreading surveys.Given the structure of the Indonesian fan community, where the majority of fans were more likely to belong to one particular fandom, this particular approach was selected.Chainreferral sampling or snowballing sampling itself was a network sampling method initiated to increase the initial sample using the initial sample's relationship with other targeted respondents (Lohr, 2021).Using this sampling method, initial contact of around 5 fandom administrators or PIC (Person in Charge) in different fans' communities/fandom through social media was made.From these initial contacts, there were about 210 responses secured.However, among those 210 respondents, only 200 were able to complete the full questionnaires.

Demographic and Behavioral Pattern
Among 200 respondents, the majority of them were female (91%) with an age range of 18 to 29 years old.The majority of them were living in big cities like Greater Jakarta (Jabodetabek -Jakarta, Bogor, Depok, Tangerang, and Bekasi).This number was fairly appropriate considering that these major cities had better infrastructure; a better internet access which led to exposing fans more to K-Pop-related advertisements and content.This situation was intensified by a large number of Indonesian content creators, who focused on promoting K-Pop.According to TikTok, Indonesia had become the leading creator of K-pop content followed by the Philippines and the US in tow (Coconuts, 2023).It also came as no surprise as the majority of respondents were between the ages of 18 to 29 years old; a younger generation commonly referred to as Generation Z. Generation Z or Gen Z were also well known as the digital natives, those who grew up with computer and the internet, were used to digital contents and had the highest exposure to that compared to older generation; this made them highly engaged with any K-pop related topics.Source: own data In terms of occupation, more than half of the fans were students with one third of them did not have their own income.Despite the fact that the majority of them were unemployed and relied heavily on their parents or other family members for financial support, they were still able to spend heavily on K-pop merchandise.About 44% of all respondents said they could still spend between IDR 500,000 (≈USD 34) and IDR 2,000,000 (≈USD 133) on their own per month.This personal spending was exclusive to rent (living arrangement) and food expenses, considering that most unemployed students still live with family; thus, making rent and food expenditures more likely part of household expenditures instead of personal expenses.This amount was considerably high considering that the minimum wages in Jakarta area was around IDR 4,600,000 (≈USD 297.20) per capita (BPK, 2023).

Source: own data
Most of the fans had become K-poppers for more than 5 years and were able to collect less than 30 pieces.Buying the merchandise at the local e-commerce was the most favourite point of purchase, followed closely by fandom group orders.This was quite an interesting finding considering that local ecommerce was flocked with unofficial merchandise.The lack of a firm policy to restrict its distribution was one of the main factors that made sellers freely sell unauthorized merchandise (CNBC Indonesia, 2022a; VICE, 2022).However, this explained the high number of respondents who have limited monthly personal spending; limited monthly personal spending but had a high number of collectables.Buying unofficial merchandise could be as low as IDR 50,000 (≈USD 3) for a keychain or photocard.This price was 5 times lower than the official one sold in local official pop-up stores.

Album Bundling
Album bundling in the K-pop market had a quite different definition compared to other similar item in other music genre markets.In K-pop market, buying an album could meant buying a mini album, a full album, or even a reunited or repackaged album.However, all those variants had one silver lining; buying an album bundle meant that buyers would get photo cards, an album/discography guide, a mini postcard or poster, a lyric book, and the album disc itself.Some even had graphic sticker photo cards or even personalized folded messages from the idol themselves.Thus, buying an album for the K-pop genre was never just buying a music disc.It was collectable items, merchandise.Source: own data

Fig. 1. Price Sensitivity on K-pop Album Bundling
From the graphic above, it can be seen that fans deemed the acceptable price range for a K-pop album bundling, regardless of the artists, was around IDR 245,000 (≈USD 15.83) to IDR 375,000 (≈USD 24.23) per bundle.This price range was quite lower compared to the price offered by official distributor/seller sites such as the WeVerse Shop website (see Table 3 below).Looking at the price range on the WeVerse website, the price for an album bundle could range from IDR 190,000 (≈USD 12.28) to IDR 300,000 (≈USD 19.38).However, this price range excluded the international shipping costs, which raked into around USD 53.94 or the equivalent of IDR 826,576.56.Thus, in total, fans could spend up to a total range of IDR 1,000,000 (≈USD 64.61) to IDR 1,500,000 (≈USD 96.91).This price was greatly varied compared to the price range in local e-commerce markets like Tokopedia or Shopee.
The calculated acceptable price range, which was way lower than the total price of the album bundle on the official website, was actually quite reasonable considering that the majority of the Indonesian fans bought merchandise from the local marketplace, group orders (fandom), or through connection-personal orders (jasa titip).These three methods would surely reduce shipping costs, in which the value could even be greater than the price of the merchandise itself, by paying the "reseller" or representative a token of money (usually around 25% of the product prices or around IDR 50,000 to IDR75,000 depending on the price).This means of purchasing made fans able to obtain their favourite merchandise without colossally bumping their spending, creating a similar range of spending with their desired acceptable price range.In this sense, album bundles purchased through another point of purchase did not necessarily counterfeit products.Album bundles purchased through group orders (fandom) or connection-personal orders (jasa titip) were official ones since they were directly bought through physical stores in the South Korea.This price range difference issue was also one of the main drivers behind the reason why there were so many local sellers in the local e-commerce market starting to sell K-pop merchandise; riding along and utilizing the hype of the Hallyu wave in Indonesia.This phenomenon seemed to be a common pattern that could be found in other countries.Choi and Maliangkay (2014) suggested that this phenomenon could be mainly driven by easy access as well as easily downloadable high-definition K-pop videos.However, it seemed that the value of the counterfeit market was relatively small compared to the commercial value of the official K-pop market.Not only the fact that original copies of K-pop albums were still popular sales, even if they were purchased through other points of purchase (e.g. group orders or jasa titip), but the official K-pop market also relied on live concert ticket sales.Live concerts were a major source of income for the K-pop industry.Despite the fact that more and more fans were coming to South Kore to experience the fan culture, K-pop artists/agencies still regularly visit other countries to meet local demands for meet and greet or live concerts (Choi & Maliangkay, 2014;Lie, 2013).

Lightsticks
Sold in various specific designs depending on the fandom/artist of the singer, the lightstick was one of the merchandise that was difficult to imitate.The lightstick's uniqueness not only lies in it being one of the specific K-Poprelated merchandise but also lies in the rarity of the technology to build it up.The latter was mainly forced by the rarity of semiconductors, which was the main component of it, 0% 50% 100% 0 100,000 200,000 300,000 400,000 500,000 Cheap Too Cheap

Expensive Too Expensive
Acceptable Price Range especially after the pandemic hit (Koreaboo, 2021).Yet, the facts remained, fans would still flock to buy lightsticks to show their loyalty and comradery toward their fandom, especially during live concerts.Lightsticks had become a distinguishable group that came with specific colour palettes and designs that represented the idol.Source: own data

Fig. 2. Price Sensitivity on K-pop Lightsticks
Unlike album bundling, fans believed that lightsticks should be priced higher.The acceptable price range for lightsticks fell in the range of IDR 465,000 (≈USD 30.04) -IDR 700,000 (≈USD 45.23) per item.This price range was closer to the price listed on the official distributor website.However, looking closely at the official distributor website, the range of IDR 563,000 (≈USD 36.37) to IDR 868,000 (≈USD 56.08) was not actually a final price range.Adding the shipping price, which was around IDR 820,000 per package, the final price range would be around IDR 1,363,000 (≈USD 88.06) to IDR 1,688,000 (≈USD 109.06).This new price range showed that the shipping price could easily double the price of the merchandise.It would be a different story if a fan bought multiple items from the official website within their single purchase; the shipping price would be suppressed tremendously, which in return would suppress the total cost.This method would save fans lots of money considering that the shipping cost was calculated based on the weight of the shopping basket per purchase instead of the number of items bought.However, the latter was few and far between considering each merchandise usually launched at different timelines.This was also heightened by the fact that during its launch it limited the sales number, which created a sense of urgency among fans to obtain it (Hellokpop, 2023;Dhan, 2023).The higher price range of Lightstick compared to album bundling was no surprise.Aside from the technology that made the lightsick, the design of each artists-bound-lightstick was unique; a one-of-a-kind design that represented the fandom of each artist.Its uniqueness was not only creating a competitive advantage for the item but also a way to avoid counterfeiting.A marketing strategy that worked and fans were unable to find a substitute for the product.Thus, it was no wonder that the price range in the local e-commerce, official seller/distributor website, and fans' acceptable price range were clustered in the range of IDR 600,000 (≈USD 38.76) to IDR 800,000 (≈USD 51.69) depending on the K-pop artist.
There was another possible reason why the local ecommerce price was still more or less in the same ring as an official website.One of them is that most merchandise sellers in the local e-commerce market were initially an administrator in group/fandom collective purchases.Referencing the previous data on point of purchase, fandom group orders ranked as the second most frequent point of purchase right after local e-commerce sellers.Fandom group orders were actually group orders (fandom) purchases of fans through one of the representatives in the fandom itself.These representatives could be Indonesian students/expatriates living in South Korea.Through them, fans could reduce shipping costs since these representatives could make a single purchase of various ordered merchandise and send it through a single shipment, which resulted in lower shipping costs for fans while guaranteeing the merchandise's originality.According to CNBC Indonesia (2022b), more representatives from collective groups/fandom order were finally opening their shops (local e-commerce such as Tokopedia and Shopee) with the aim of reaching a wider market.Another reason was since it was quite difficult to duplicate, sellers in local e-commerce often came up with alternative buying such as fan-made lightsticks.However, since it was not endorsed by the artists themselves, the market for it was rather small compared to the official lightstick design.

CONCLUSIONS
Unlike any other music genre in the market, the K-pop genre had its distinctive merchandise market, where it sold specific and one-of-a-kind merchandise such as album bundling and lightstick.As this study looked closely into the price of album bundling and lightstick, it can be seen that Indonesian Kpop fans were quite sensitive toward the price of its merchandise; creating an air of competitiveness in the market as well as a greener pasture for counterfeiting products.
In terms of album bundling, fans' acceptable price range was inclined to cluster closely around local e-commerce market prices, which ranged from IDR 245,000 to IDR 375,000 per bundle.This probably happened since the album bundling was easily duplicated, given the fact that high-quality music video and audio were easily accessible (downloadable) to the public.Aside from that, local e-commerce could be as well as original products; however, sellers could resell each piece at certain upscale prices.Thus, making a profit margin while also creating an image of bargain-sellers.On one hand, this cultivated South Korean's regional hegemony in the South East Asia and Asia Pacific in general, which in return also encouraged the emerging cultural market for K-pop.A pattern that seemed to work to induce the influence of K-pop-related-merchandise in the merchandising market so far.On the other hand, it lowered the market barrier by making it accessible for counterfeiting.
Different case happened for lightsticks.Lightsticks as merchandise had uniqueness both in terms of design and the technology that made them up.Its uniqueness made it impossible for resellers to create counterfeit products.Also, lightsticks were not sold in bundling with others type of merchandise, making it hard for resellers to resell and upsell them by pieces.Given these circumstances, it was unsurprising that the fans' acceptable price range was close to the official price (excluding the shipping price), which was around IDR 465,000 -IDR 700,000 per item.However, the price of lightstick was heavily dependent on how famous the artist was.The more well-known the artist was, the more expensive the price was.
Considering both cases, it was suggested that merchandise stakeholders improve their competitive advantage, creating a more unique selling item.This could improve the barrier in the market which in return reduces the number of sellers that sell counterfeit products.Another suggestion for K-pop agencies to enforce their grab on the local authorities and law on counterfeit products to restrict the distribution of unofficial merchandise.This was based on the study result where the fans' acceptable range was closer to the local e-commerce price range compared to the official merchandise website.
Ultimately, these suggestions would depend heavily on stakeholder's priorities.Currently, the stakeholders putting even more focus on selling tickets to live concerts or meet-andgreet events alike.While there was no doubt that ticket sales might garner more revenue compared to selling merchandise, considering that concerts were a more developed and stable way of monetizing K-pop compared to merchandise, the merchandise market had been developing steadily and accelerating now more than ever.

LIMITATIONS
Looking at the demographic data, the data distribution could be a potential limitation.The majority of the respondents were residing in Jabodetabek (Jakarta, Bogor, Depok, Tangerang, and Bekasi) with few representations outside the area.Thus, the results of the study might be different should it have adequate representatives of each area in Indonesia.Also, as this paper limited the type of merchandising studied, it might limit the flexibility of the price range for K-Pop merchandising in general since both items might not be a proper representation of K-Pop merchandising as a population.Both items were chosen due to their unqueness and by no means representing the whole array type of K-Pop merchandise itself.

Table 3 .
Market Price Comparison on K-pop Album Bundling (data taken September 2023) *The official seller website referred to the Weverse website as the official seller for worldwide distribution.The price often excluded shipping price (around USD 53.94 or equal to IDR 826,576.56)**Price from the average local marketplace.Calculated by taking at least a sample of 5 sellers' prices.Price often included shipping price since the marketplace usually offered free shipping promotions.Source: WeVerse, Tokopedia, and Shopee

Table 4 .
Market Price Comparison on K-pop Lightsticks (data taken September 2023) The official seller website referred to the Weverse website as the official seller for worldwide distribution.The price often excluded shipping price (around USD 53.94 or equal to IDR 826,576.56)**Price from the average local marketplace.Calculated by taking at least a sample of 5 sellers' prices.Price often included shipping price since the marketplace usually offered free shipping promotions.Source: WeVerse, Tokopedia, and Shopee *