Skip to main content

Korean Beauty Trends & Industry News: 23-10-30

Diverging Fortunes in China: AmorePacific Smiles, LG H&H Frowns

South Korea's cosmetic giants, AmorePacific (Amore) and LG Household & Health Care (LG H&H), have had contrasting fortunes in the Chinese market. China's economic downturn and consumer retrenchment have significantly impacted both companies.

AmorePacific has mitigated the impact by diversifying its market reach, seeing growth in Japan and North America. Notably, their brands Innisfree and Laneige have performed exceptionally well in North America. According to the financial analytics firm FnGuide, Amore's Q3 operating profit is projected to increase by 62% YoY, reaching around $43 million.

On the other hand, LG H&H chose to double down on the Chinese market, but their performance has sharply declined. Their Q3 operating profit decreased by 32.4% YoY to around $109 million, and their revenue decreased by 6.6%. Particularly, their cosmetic business recorded a 15.1% decrease in sales and an 88.2% decrease in operating profit.

Analysts believe that growth in regions outside China is becoming more critical. Jo So-Jeong, a research analyst at Kiwoom Securities, pointed out, "Although the recovery of cosmetic demand in China is slow, demand in non-Chinese markets remains strong."

The different strategies of the two companies and the uncertainties in the Chinese market will continue to be a focal point.


Petrochemical and Cosmetics Industries Target Future Markets with Eco-Friendly Strategies

South Korea's petrochemical industry is preparing for the future by focusing on eco-friendly businesses. Specifically, they are strengthening collaboration with the cosmetics industry to expand eco-friendly plastic packaging and biofuel ventures. This is seen as an essential strategy for carbon reduction and environmental protection.

In light of the European Union (EU) and France's plastic use restrictions and the planned mandatory use of 'bio jet fuel' in Europe by 2025, petrochemical companies are bolstering their collaborations. For example, LG Chem and SK Chemicals have entered into agreements with AmorePacific and Estée Lauder for developing eco-friendly packages and recyclable materials. Lotte Chemical has also signed a business agreement with Yeonwoo, Kolmar Holdings, and PumTech Korea for eco-friendly cosmetic packaging.

Moreover, there's a notable momentum in the biofuel sector. SK Trading acquired Daekyung OT to secure bio diesel and bio jet fuel resources. The Hyosung Group has commercialized the world's first bio-spandex. Given the expected introduction of carbon taxes and plastic taxes globally, these initiatives are considered very important.

McKinsey projects that by 2050, the recycled plastic market could be worth around $510 billion. Industry insiders are optimistic, saying that the collaboration between the petrochemical and cosmetics industries is not only environmentally positive but also brightens the future market outlook.


Korean Cosmetics Conquer Japanese Market: Strategies and Outlook

Korean cosmetics are rapidly growing in the Japanese market. Specifically, BanoBagi Cosmetic's 'PDRN Repair Real Balm' is gaining immense popularity on Rakuten, Japan's largest e-commerce site. The product utilizes salmon PDRN and roe extracts, excelling in skin whitening and wrinkle reduction. It also performed well in South Korea, winning the '2023 Allure Best of Beauty Award'.

Japan is the world's third-largest beauty market, and following China, Korean cosmetic companies are targeting Japan. Last year, imports of Korean cosmetics into Japan amounted to around $602 million, a six-fold increase over the past decade. Both large and medium-sized companies are expanding through online and offline channels. Giants like AmorePacific and LG H&H are targeting the Japanese MZ generation with a premium strategy.

The growth is partly attributed to the promotional effects of Korean celebrities. Industry insiders project that Korean cosmetics will continue to grow in Japan and that a premium strategy will be needed. Thus, Korean cosmetics are gradually increasing their influence in the Japanese market as well.
Location: 대한민국

Comments

Post a Comment

Popular posts from this blog

Which sunscreen should I use, Inorganic or Organic?

Overview There are mainly two types of sunscreen: Physical and Chemical.  Inorganic sunscreens are also called Physical Sunscreen or Mineral Sunscreen. Organic sunscreens are also called Chemical Sunscreens. A term Inorganic and organic are derived from chemistry. * Organic Chemistry: The Study of Molecules Based on Carbon, Hydrogen, and Nitrogen * Inorganic Chemistry: The study of compounds other than organic chemicals A sunscreen can, of course, have both of these functions. It is called a Mixed sunscreen or a Combined sunscreen, and these days, many brands are developing products like this. Through this post, let's find out what inorganic and organic sunscreens are, and what sunscreens are most suitable for one to use. The difference between inorganic and organic sunscreen. Inorganic sunscreen is a sunscreen that forms a protective layer on the surface of the skin to block ultraviolet rays before they penetrate into the skin. Most product contains titanium dioxide and zinc oxid...
Post a Comment
Read more

Misleading Claims in Microneedle Skincare Products: 82 Cases Identified

     Recently, microneedle skincare products have gained significant popularity, but Korea’s Ministry of Food and Drug Safety (MFDS) has uncovered that over 80% of these products being sold online are making false or exaggerated claims. After reviewing 100 online posts, the MFDS found that 82 of them violated Korea’s cosmetics regulations, leading to requests for the posts to be blocked by the Korea Communications Standards Commission. The misleading advertisements primarily claimed that microneedles could penetrate deep into the skin layers or promised immediate pore reduction, both of which are not scientifically validated for general cosmetic products. Microneedles are a medical technology designed to deliver substances into the deeper layers of the skin, typically used in drugs and medical devices. However, in the cosmetics industry, these products generally do not have the same capabilities. Some companies falsely advertised their products as having effects similar t...
Post a Comment
Read more

Korean Beauty Trends & Industry News: 24-05-08

Cosmax Leads in Cosmetics with New Hair Loss Evaluation Technology      Cosmax, a South Korean cosmetics company, has announced the development of a novel hair loss evaluation method using "hair and follicle mimicking organoids." This technology was showcased at the 2024 Organoid Developer Conference in Seongnam, Gyeonggi Province last month.  Organoids, made from stem cells, excellently replicate human cellular structure and function. In collaboration with OrganoidScience, Cosmax has successfully recreated androgenetic hair loss symptoms by introducing growth factors into reprogrammed stem cells to create a scalp mimic.  Furthermore, their proprietary ingredient "Soyact" has been validated for its effectiveness in suppressing male pattern baldness and received non-prescription functional certification from the Korean Ministry of Food and Drug Safety. Cosmax sees this technology not only advancing hair loss treatment materials but also setting a new standard in ...
Post a Comment
Read more