Korean Beauty Trends & Industry News: 23-11-01

Cosmetics Industry Rocked by Price Hikes and Poor Financials

The cosmetics industry is buzzing over recent price increases. LG Household & Health Care announced that starting November 1st, they plan to hike the prices of some of their products—including brands like Soom, Ohui, Belif, and The Face Shop—by an average of 4-5%. L'Oréal is also looking to bump the prices of its Lancôme, Kiehl’s, Biotherm, and Yves Saint Laurent products by 5%. Innisfree has already raised the prices of 109 products this year by an average of 19.3%, and Amorepacific’s luxury line Sulwhasoo also increased prices on some items. The driving factors behind these hikes are global inflation, currency fluctuations, and rising raw material costs.

These increases are closely linked to poor performance in the cosmetics sector. LG Household & Health Care and Amorepacific Group recently reported that their third-quarter sales have declined by 6.6% and 5.7% respectively compared to last year, and their operating profits have also decreased by 32.4% and 12.7%.

The rise in prices isn't just affecting cosmetics; it’s part of a broader trend that's hitting consumers' wallets. Despite calls from political figures for price stability, companies are finding these increases unavoidable. Prices for some goods, including dairy and alcohol, are expected to increase by as much as 19%, putting a further strain on household budgets.

This difficult period for the cosmetics industry seems unavoidable due to poor sales and the rising costs of raw materials. These shifts are likely to bring about broader changes, impacting not just consumers but the industry as a whole.

Kolmar Korea Publishes Research on 'Triple-Function' Products Utilizing Silverweed

Kolmar Korea announced on the 30th that their research paper on triple-function cosmetics utilizing Silverweed extract has been published in the international academic journal 'International Journal of Molecular Sciences.' Silverweed, a type of Potentilla anserina, is a plant used in Tibet for its remarkable regenerative properties, including in treatments for viral infections.

The research team applied Western liposomal technology to Silverweed extracts, developing a product with triple functionality: wrinkle reduction, skin whitening, and barrier repair, along with improvement in itchiness. The technology allows active ingredients to penetrate deep into the skin and remain there, slowly releasing over time.

Clinical trials on humans have shown that the activation of Aquaporin-3 improves skin hydration and barrier function. Aquaporin-3 is a protein responsible for transporting water and glycerol to the epidermis, thus contributing to skin hydration. Additionally, increases in Filaggrin and a decrease in Hemoglobin levels contributed to a reduction in itchiness and skin redness.

A representative from Kolmar Korea said, "With 8 out of 10 Koreans having sensitive skin, there’s a high demand for cosmetics that address these concerns. We plan to continually research and develop medicinal ingredients and anti-aging materials for consumers with sensitive skin issues."

Vital Beauty Launches 'Super Retinol C' for Inner Beauty Innovation

Amorepacific's flagship inner beauty brand, Vital Beauty, is launching 'Super Retinol C' in collaboration with dermatologists, based on 29 years of Retinol research. This product goes beyond topical retinol to introduce 'edible retinol', a synergy formula of vitamins and retinol aimed at creating a vibrant and bright daily life.

The key ingredients include Retinol (Vitamin A), along with Vitamin C, D, E, zinc, and pantothenic acid. With antioxidant effects, it protects cells and allows an easy intake of 1,000mg of Vitamin C in just two sachets a day. The product also contains plant-based retinol extracted from Moringa leaves, so it’s safe for consumption.

Recommended intake is 1-2 sachets per day, easily dissolving in cold water as a beverage. Citrus extracts and mango juice powder have been added for a fresh and refreshing taste. The product is vegan and will be available in both online and offline Olive Young stores starting November 1, with a limited promotion offering 10 extra sachets with the purchase of a basic 30-sachet product.

According to an Amorepacific spokesperson, "The product is convenient due to its powder consumption method and is safe for customers sensitive to retinol. It's a thoughtful product considering both taste and value for money."

Daiso's Cosmetic Business Poses New Competitive Threat to Olive Young

Daiso is rapidly growing in the beauty market, posing a threat to industry leader Olive Young. By offering high-quality products at affordable prices, Daiso has seen a 160% increase in sales year-over-year. This growth has put pressure on CJ Olive Young to launch cheaper products.

Currently, Daiso sells 25 beauty brands, offering products that range from 500 to 5,000 won. The growth of the home beauty market due to COVID-19 and successful marketing to the MZ generation have contributed to Daiso's success, making its beauty business popular across various age groups.

This shift has also impacted other retailers. Coupang is focusing on fresh food categories, while Gmarket and Auction are offering autumn and winter fashion discounts. E-Mart and Lotte Mart have also launched affordable 'half-price series' products.

According to industry insiders, Olive Young may have a negative image, but Daiso is gaining competitive edge through its affordable pricing and high accessibility. However, Olive Young still maintains its lead in terms of the number of stores and popularity among consumers in their 20s and 30s, so the competition is expected to continue.

However, this ultra-competitive pricing could potentially undermine product quality and brand value. While some experts and Olive Young believe Daiso’s success could expand the market, consumers will need to make cautious choices between price and quality.

Korean Cosmetic Association Hosts Webinar on European Exports

The Korean Cosmetic Association (KCA), led by Chairman Seo Kyung-bae, is continually hosting webinars to provide essential information and knowledge needed in the domestic cosmetics industry. On October 19, a successful webinar was held comparing sunscreen regulations among major countries. Sandra M. Browne of Browne & Associates Consulting Ltd. presented the topic, providing insights into sunscreen regulations in the U.S., Europe, ASEAN, Australia, and Canada to help domestic companies better prepare for exports.

On November 6, another webinar is scheduled on 'Everything You Need to Know for Exporting to Europe.' The session will be led by representatives Olivia Santoni and Amanda Eisom from Bloom Regulatory Ltd. The key topics to be covered include CPNP, PIF, recent changes in cosmetic ingredient regulations, expanded mandatory labeling for fragrance allergens, nano-material regulations, general approach to safety assessments (GRA), EPR, and packaging regulations.

Pre-registration for these webinars is available through the KCA's website, and real-time Q&A sessions are also planned. Through these webinars, the Korean Cosmetic Association aims to contribute to elevating the global competitiveness of the domestic cosmetics industry.