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Korean Beauty Trends & Industry News: 24-01-12


Daiso's Beauty Revolution: A Strong Challenge in the Cosmetics Market

Daiso, a renowned value retailer in Korea, is making significant waves in the beauty market with its high-quality yet affordable cosmetics range. The brand is becoming increasingly popular among consumers of all ages, from teenagers to adults, thanks to its easily accessible stores and reasonable pricing. Notable Korean beauty brands such as Aekyung Industrial, Nature Republic, and Too Cool For School have collaborated with Daiso to launch exclusive products, boosting sales.

Last year, Daiso's sales of basic skincare and color cosmetics surged by 180% compared to the previous year. VT Cosmetics' 'Riddle Shot' line, known for its excellent quality at low prices, has become so popular that it often runs out of stock. The product is priced ten times cheaper at Daiso compared to similar products sold at Olive Young, a leading Korean beauty retailer. This pricing strategy is a result of Daiso's cost-minimization efforts.

Daiso currently operates about 1,450 stores and is perceived as complementing rather than competing with Olive Young. The brand plans to continue expanding its beauty product range, leveraging its stores' advertising effect. Daiso's growth in the beauty market is attributed to its strategy of offering high-quality products at budget-friendly prices and collaborating with various brands. By simplifying packaging and minimizing advertising, Daiso has been able to reduce costs and rapidly grow in popularity.

Consumers are satisfied with both the quality and prices of Daiso's cosmetics, demonstrating the brand's strong position in the beauty market. Daiso continues to increase its order volume for cosmetics and is effectively using store formats and market data to design its product categories. Some of its popular products include Lab Factory Multi Balm Wrinkle Stick, Nature Garden Citrus Vita Tone Up Sun Cream, and Twinkle Pop Glitter Layering Eye Palette.

The primary difference between Daiso and Olive Young lies in their pricing strategies. Daiso's affordable prices attract a diverse customer base, leading to a complementary relationship between the two companies. Daiso's expansion in the beauty market reflects its strategy of providing quality products at reasonable prices, which has resonated well with consumers.


Zigzag Leads the Beauty Market with Rapid Purchases Post-Search

Zigzag, a style commerce platform operated by KakaoStyle, reported that customers take an average of 3.4 days from product search to purchase, with the beauty category leading the way at an average of 2.4 days. This swift purchase time is attributed to high personal preferences for specific brands and purpose-driven shopping, where customers quickly buy products after searching for the required item or brand.

In contrast, the shopping mall and lifestyle categories, which offer a wider range of choices, tend to involve more exploratory shopping, leading to longer purchase times. Zigzag has the highest conversion rate from search to purchase in

the beauty category, likely due to customers repeatedly buying the same needed products, indicating a strong trend of purpose-driven shopping.

To cater to this trend, Zigzag offers daily special discounts on a variety of beauty and fashion brand products. The platform uses AI-based personalized recommendation systems and styling suggestions to enhance customer experience and shopping convenience. KakaoStyle representatives emphasize their ongoing efforts to analyze customer preferences and improve shopping convenience, positioning Zigzag as a leading player in the beauty market.


CJ Olive Young Invests 300 Billion Won in K-Beauty Synergy and Legal Compliance Enhancement

CJ Olive Young, a leading South Korean health and beauty store, plans to invest 300 billion won over the next three years to support the growth of new and small beauty enterprises and to strengthen legal compliance. This investment is part of their strategy to build a sustainable and healthy K-beauty industry ecosystem.

Collaborating with IBK Industrial Bank, Olive Young has created a 100 billion won mutual aid fund to help small and medium-sized partners with reduced interest loans, benefitting 100 companies this year. Additionally, Olive Young is shortening payment periods from 60 to 30 days for all partners, starting with direct-purchase vendors.

The investment will also focus on discovering and nurturing new brands and products, supporting their global expansion, and allocating funds over three years to support hygiene and health for underprivileged groups, local economic revitalization, and environmental activities.

Olive Young is establishing an in-house legal compliance committee and recruiting external members to strengthen its legal management system. CEO Lee Sun-jung stated that they aim to support the global success of Korean cosmetics and make them a leading export item of South Korea. These measures follow sanctions by the Fair Trade Commission for unfair practices and reflect Olive Young's commitment to fair business and legal compliance. CJ Group Chairman Lee Jae-hyun also emphasizes the importance of mutual growth with partners.


Cosmax Expands Its Role as a 'K-Beauty' Ambassador in Emerging Markets

Cosmax, a leading ODM (Original Design Manufacturing) company in cosmetics, is expanding its role as a K-beauty ambassador through strategic targeting of emerging markets. The company has established task forces in regions like the Middle East, South America, India, and Africa, successfully securing local client partnerships.

In the Middle East, Cosmax obtained certification from one of the top three Halal certification agencies, MUI, in 2016, facilitating its entry into Islamic cultural markets. This led to product supply agreements with influencer brands in the UAE and additional customer acquisitions in Turkey.

In Africa, Cosmax onboarded Kenyan skincare brand Uncover, which caters specifically to black skin, gaining attention not only in Africa but also in the U.S. and Europe. The brand's sunscreen and serum, customized for the local market, have been particularly successful.

Cosmax also expects significant growth in the South American market, having secured new customers in Mexico through its New Jersey factory. In India, the premium image of K-beauty has led to new client acquisitions.

Cosmax is emphasizing the growth potential in emerging markets and plans to enhance communication with global customers through digital showrooms. These showrooms not only showcase products but also share global beauty market trends and Cosmax's technological expertise, aiming to spread the value of K-beauty in these markets.
Location: 대한민국

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