Anime has been having a moment for the last couple of years, and especially it increased during the pandemic. It has made some major investment changes over time, and now its fruits are showing. Anime has come a long way to become what it is now. Even with dwindling birthrates and an elderly population, the Anime Industry is making its mark on the economic map of the world. Let us see how.

History of the Anime Industry

Anime means “animation” in Japan. So in theory, it could apply to any form of animation from around the world. However, in modern times it referred to any Japanese animation. Japan began producing animation in 1917 through trial-and-error drawing and cutout animation techniques.

The technique was based on animated short films from France and the United States. However Japanese anime were costlier to produce than Western animations and were overshadowed by the popularity of Disney cartoons. They faced an uphill battle from the start.

The things that helped them find their niche were anime production for public relations and publicity campaigns by public institutions. Domestic anime production developed had a small but solid foundation until 1923. However, catastrophic damage in the Great Kantō Earthquake later followed by World War II shook the foundation of local studios.

The anime industry was forced to start over from scratch. It was also during these years, as Japan began to recover from the disastrous war, Ōkawa Hiroshi, president of the Tōei film company overwhelmed by Disney’s Snow White (1937) aimed to become “the Disney of the East”. Tōei Dōga(currently: Toei Animation Co.) chose Hakujaden (The Legend of the White Snake) as their first film following the Disney system of “assembly-line production.”

On January 1, 1963, Fuji Television broadcasted a 30-minute animated television series by Osamu Tezuka (more popularly known as God of Manga) called Tetsuwan Atomu (Astro Boy). The show became a surprise hit, starting an anime boom and a period of intense competition for TV audiences.

The success marked the beginning of a new kind of anime industry. Merchandising became a major source of revenue as the company offset its losses with copyright income. The licensing of the rights for the Atom character to their corporate sponsor.

A confectionery maker Meiji Seika used the character on a popular brand of chocolates. All of these marketing tactics helped build the revenue.

Toei further pushed animated shows to mainstream television in the 1960s. They started with heavy hitters like Gegege no Kitaro, Dragon Ball, Sailor Moon, Digimon, and One Piece (among many others). They collaborated with some legendary anime artists, like Hayao Miyazaki, Yoichi Kotabe, and Yasuji Mori.

Meanwhile, Japanese television anime began to become popular among young people overseas. In some countries, adults rejected it, calling it “Japanimation” and criticizing it as cheap, violent, and sexually explicit.

While some parents were concerned that their children were being corrupted by a strange culture from the Orient. Many wondered, “Why can’t our country create works that surpass Japanimation?” Today, “Japanimation” means something quite different from the negative connotations it used to have.

Current Scenario Of Anime Industry, Globally.

The animation industry has continued to grow for 10 consecutive years. Which reached a record high for 7 consecutive years in 2019. Both domestically and internationally. It amassed a sum of 2,511.2 trillion yen approximately USD 24 Billion. A growth of 19% over the previous year.

Despite the declining birthrate, ageing population, and the shrinking domestic market due to the tightening of regulations in China in April 2019, the market has grown fivefold compared to 2009.

Major key players in the Anime market are P.A. Works, Toei Animation Co., Manglobe Inc., Sunrise Inc., Bones Inc., Studio Ghibli, Inc., and Production I.G, Inc., Sunrise Inc., Pierrot Co., Ltd. Inc., Madhouse Inc., and Kyoto Animation Co. Ltd.

Right now, Anime is a global phenomenon built around an essential Japanese product. With the advent of anime came a new form of cross-cultural learning. With audiences around the world discovering Japanese art, culture, and beauty. Sakuga(作画 orさくが) has become an integral part of the popularity of Anime in recent times.

The proliferation of media has resulted in a new form of tourism as well, known as ‘contents tourism’. It focuses on narratives, characters, and locations. Such as Suga shrine stairs from Your name or Attack on Titan Theme Park.

In an article by Variety, Joanne Waage, GM of Crunchyroll on the current situation of Japanese animation says,

“The audience outside Japan has become more visible – and they’ve had to take that into account.”.

In the anime industry 5 years ago, a new Anime series was released once a month. Now, the situation has drastically changed. As of the huge demand in this industry, we see new anime/Manga coming out within days. Talking about anime, we have been seeing huge growth in the Cosplayer industry too.

OTT giants have taken upon the responsibility to meet the demands of the audience at best. This includes catering for Anime shows and signing deals with many Japanese anime studios to keep the ball rolling. In November 2019 Netflix contracted with Anima, Sublimation, and David Production and is coming up with new original releases soon.

In an article by Variety, Netflix revealed their most recent tie-ups with Anima & Company (owner of NAZ), Science Saru and Mappa from Japan, and with Studio Mir based in Korea “to explore new stories and formats to entertain anime fans around the world.”

Anime has established itself as a mainstream genre of its own and has secured a place on the global stage. The attention garnered by anime has resulted in a renewed interest in the Far East. Japan is establishing itself as a popular tourist destination.

Looking at how the industry has grown, it’s safe to say that anime culture rivals that of other countries, with anime being here to stay.

Future Scenario Of Anime Industry, Globally

The Anime Market was valued at USD 24.23 Billion in 2020. In research conducted by Brandessence Market Research And Consulting Private Limited, it is anticipated to reach USD 43.73 Billion by 2027 with a CAGR of 8.8% over the forecast period.

Also, people willing to spend hundreds of dollars to aid the rising popularity of media drives the growth of the Anime Market.

How anime will grow around the world?

Comparing the Anime Industry today with 2027, we can expect huge growth as there’s an exponential growth of Animators worldwide. This industry does not need an office. The only thing that you need is creative ideas. The more ideas you have, the more people will follow you.

We will see much better Anime coming with quality & quantity. We could also expect to see a variety of Anime series flowing on the internet. In the coming years, we expect that the Anime Industry will compete hand-in-hand with the Digital & IT industries.

Anime Streaming App Market by 2027

Due to Covid 19, many Anime production companies faced setbacks which has negatively affected the anime market growth. On the other hand, internet supply has surged in the last few months, leading to reasonable growth of the market. During this crisis, OTT giants like Netflix have steadily added Anime to their arsenal. Thus, revealing how much the audience is willing to spend on anime shows and movies.

In an article by MarketPlace, it was said that-“There are anime shows that put up ‘Game of Thrones ’-style numbers,” said Mike Toole, editor-at-large for Anime News Network. Anime has a loyal global audience, which is why streaming services like Netflix, HBO Max, and Disney Plus have been quietly investing in it as a way to tap into a young international audience that will stay engaged for a long time.

A few of the main competitors currently working are –Amazon.com, Inc., Aniplex of America Inc., Crunchyroll, HIDIVE LLC, Hulu, LLC, and Madman Entertainment Pvt. Ltd, Netflix, Inc., Tubi, Inc., Vimeo OTT Solutions, Inc., VIZ Media LLC.

Anime: Revenue Generation Methods

The global anime market size was valued at USD 20.47 billion in 2018 and is expected to register a CAGR of 8.8% over the forecast period. In the ’90s, Japan was suffering from a prolonged economic downturn.

At the same time, Japanese pop culture icons like Pikachu and Hello Kitty can be found all over the world  — and continue to be evergreen even today.

Global Anime market report is segmented based on product type and region & country level. Based on product type, the global Anime market is classified as T.V., Movie, Video, Internet Distribution, Merchandising, Music, Pachinko, and Live Entertainment.

Regional & Country Analysis of the Anime Market

The regions covered in this Global Anime market report are North America, Europe, Asia-Pacific and the Rest of the World. Based on country level, the market of Anime is subdivided into the U.S., Mexico, Canada, UK, France, Germany, Italy, China, Japan, India, South East Asia, GCC, Africa, etc.

Product Type Insights and Revenue Generation

Owing to the rapid growth of distribution platforms like Crunchyroll, Daisuki, Netflix, and Amazon, among others, Japanese anime has found a remarkable number of new takers. The live entertainment and internet streaming of such content has led to a substantial rise in the international distribution of Japanese anime.

Thus, internet distribution has become the most reliable and lucrative route for distribution across the globe.

Overseas sales of Japanese anime include licensing of video software, internet distribution, TV broadcasting, rights to show the film, and licensing for character merchandising.

While the Japanese anime business getting stronger across the globe, the domestic production capacity has reached its limit which led to some low-quality work concerns for their customers.

The merchandising segment dominated the anime market in 2018. The merchandise associated with anime includes posters, key chains, t-shirts, dolls, and other figurines, usually sold via online and offline channels.

The shift from real products to digital products has become more popular in the past few years, owing to which merchandising segment is predicted to witness a decline in demand over the forecast period.

Therefore, it has become necessary for vendors to develop merchandise that meets the needs of consumers more than ever to sustain itself in the market.

To read more on the Anime Market Growth trends, click HERE.

Though in 2018 Japanese animation market recorded consecutive growth, the curve slowed down compared to the 30% growth recorded in 2016 and 2017, according to the 2019 survey report by AJA.

The rapid growth was supported by the bulk-buying by Chinese consumers; however, they became reluctant with concern over the impact of the regulations against media content announced by the Chinese Government in 2018.

The loss was managed by the growing demand for Japanese animation in North America with expectations of 5G, and expanding overseas sales of smartphone games related to anime. This helped to increase the overseas market slightly.

If we look at the 2020 report by AJA, we can see that even without the demand from China, the distribution demand is growing both at home and abroad. Due to the outstanding performances by the Studios, the number of works is increasing even under the situation of improvement of production unit price.

This increase means that the demand for new titles is increasing along with the growth of the distribution genre.

As the current market trend, anime is gaining affinity globally and has increasing popularity. In addition, developers, publishers, animators, and other creative agencies and artists are important assets for important value generation within the market.

Fascinatingly, the industry has been reliable across all the mediums it’s distributed. Anime content is classically distributed through TV, movies, videos, music, and pachinko machines, among others.

Financial Contribution of Anime in Japan, China, and Korea

Japan generated the highest revenue in 2018. The presence of a majority of animation studios in the country is supporting the growth. The anime industry is oriented in Japan and is now becoming popular globally.

For instance, nearly 622 animation studios are present in Japan that engage in the development of animation-related content, out of which 542 anime studios are located in Tokyo itself.

The Asia Pacific is expected to witness significant growth in the global Anime market owing to the growing penetration of video distribution services such as Netflix, Amazon, and Chinese platforms in this region.

The rapid growth in the popularity of anime in China has been a major factor driving the demand in the Asia Pacific region.

In recent years, anime content has been developed in Japan on commission from China coupled with extremely influential content such as Dragon Ball in the Asia Pacific Excluding Japan (APEJ) region supporting the regional market growth.

On the other hand, Beijing as anticipated introduced certain regulations on Japanese anime for protecting China’s domestic industry.

These regulations were thought to hamper the growth of the Japanese anime industry in China over the forecast period but it was saved by the high demand growth for the production of new titles all around the world.

Second to China in population, India is also making its way to become a popular Anime hub. Every day the Indian anime fandom is growing exponentially, demanding higher video content from all over the world.

Most hardcore fans of anime exterior of Japan have been doing importation of their favourite series for times first on physical media and later digitally, with fan groups meticulously translating each episode and launching unofficially.

The state in East Asia, once considered a custodian of local culture and a censor of foreign influences, has gradually changed its position and now views media production and its export as an integral part of market activity beneficial for both economy and diplomacy.

Animation proved to be one of the promising fields of interest for both Korean and Japanese media industries. A research paper, by Nissim Otmazgin, states that the global position of Korea regarding Animation is still not nurtured well. According to Eugene Kang, founder, and president of Synergy Media, a Seoul‐based company,

“The global market is the best guarantee for the Korean media industry to remain sustainable. He estimates that out of approximately 350 animation studios, only about 20–25 are competitive. The others are very small”. According to him, all Korean companies must go global from the beginning to make a mark, globally.

How can India Contribute To the Anime Industry and Gain Profits?

Overall, it is clear that regardless of the extent, there is a strong relationship between the economy and anime of Japan. Dramatically speaking, the position of Anime is like- Japan supporting anime in its quest to become an economic superpower.

Meanwhile, anime simultaneously competes against the ever-expanding competition globally.

Even India is not so far from joining the Anime team with Karmachakra by Studio Durga on its way. As part of the Asia Pacific faction, India has the potential to be a gold mine for Anime enthusiasts.

The Indian Animation scenario is plagued majorly by the corruption within the system as well as the disfavouring mindset of the current content creators and producers. This is evident by the fact that the majority of animators who worked on Game Of Thrones CGI were Indian/Indian companies.

Yet, on Indian television, we see animations that are cringe-worthy. The production houses should learn from these examples of our neighbouring countries. This would put India on the global map of the animation industry.

However, the situation is drastically changing with the rise of the consumption of anime content in India.

Animehunch is further building the anime industry in India by taking baby steps. We are grooming artists and storytellers and providing them with a platform for enthralling stories inspired by the Japanese art of manga drawing.

We are aiming to be the Indian Anime content creators in the country. Eventually making India a competitor to countries like China and Korea.