Korean Beauty Trends & Industry News: 24-05-21

K-Beauty Thrives in the Global Cosmetics Market in 2023

    Last year, South Korea's cosmetics export value increased by 6.4% from the previous year, reaching $8.5 billion, securing its position as the fourth largest in the world. This growth from $8 billion in 2022 further demonstrates the global competitiveness of K-beauty.

According to the Ministry of Food and Drug Safety, in the first quarter of this year, cosmetics exports surged by 21.7% compared to the same period last year, amounting to $2.3 billion. The major export destinations in 2023 were China ($2.78 billion), the United States ($1.21 billion), and Japan ($800 million). Although exports to China decreased, there was significant growth in exports to North America and Europe. Notably, exports to the United States increased by 44.7%, surpassing $1 billion, while Korean cosmetics even outperformed French products in Japan.

Cosmetics production also saw an upward trend. In 2023, domestic cosmetics production rose by 6.8% year-on-year, reaching 14.51 trillion KRW. Basic skincare products held the largest share, followed by color cosmetics, personal cleansing products, and hair care products. Color cosmetics, particularly lip products, experienced the highest production increase.

Diversifying export destinations is a key strategy for K-beauty. As exports grow across various continents including Asia (excluding China), North America, and Europe, the number of export countries has expanded to 165. Efforts to enhance regulatory cooperation with the United States and China are also underway to support export growth.

Among domestic cosmetics manufacturers, LG Household & Health Care and Amorepacific hold the largest market shares. Other significant producers include Aekyung, Atomy, and Clio. The number of companies with production exceeding 100 billion KRW increased to 12 last year, up by five from the previous year.

The Ministry of Food and Drug Safety aims to further strengthen the global competitiveness of the domestic cosmetics industry by harmonizing international standards and engaging in regulatory diplomacy with major export countries.

May Cosmetics Listed Companies' Brand Reputation

    In a recent analysis of brand reputation for cosmetics listed companies, Amorepacific ranked first, followed by LG Household & Health Care and Clio.

The Korea Corporate Reputation Research Institute analyzed big data on cosmetics listed companies' brands from April 20 to May 20, 2024. The analysis involved 29.86 million data points, a 13.95% increase compared to April's 26.21 million data points.

Brand reputation is evaluated based on consumer activity data divided into participation value, communication value, social value, market value, and financial value. The brand reputation index is calculated from these combined metrics.

In May 2024, the top 30 cosmetics listed companies by brand reputation were Amorepacific, LG Household & Health Care, Clio, Hyundai Bio, AmoreG, Korea Kolmar, Cosmax, VT, Coreana, Aekyung, TonyMoly, Hankook Cosmetics, DYD, Wonik, Hyundai Futurenet, IFamily SC, Cosnine, C&C International, Korea Cosmetics Manufacturing, Barunsong, Cody, Cosmecca Korea, Able C&C, Bonne, Hyundai Bio Land, Lapas, Naturalendo Tech, Neopharm, Organic Tea Cosmetics, and Sehwa PNC.

Amorepacific achieved the highest brand reputation index at 6,385,598, showing a 22.20% increase from April. LG Household & Health Care followed with a brand reputation index of 4,523,451, a 7.46% increase. Clio ranked third with an index of 1,920,908, up by 10.05%.

The analysis indicated a general increase in brand-related activities, with brand consumption up by 14.68%, brand issues up by 12.40%, brand communication up by 25.94%, brand spread up by 7.03%, brand market up by 13.22%, and brand contribution up by 26.61%.

The Korea Corporate Reputation Research Institute's director noted, "Consumers' online habits significantly influence brand consumption, and our big data analysis systematically evaluates this."

KOTRA Supports SMEs Entering Japanese Market with LOFT

    The Korea Trade-Investment Promotion Agency (KOTRA) and the Ministry of Trade, Industry and Energy will hold a 'Japan LOFT One-on-One Entry Consultation' at KOTRA's Seoul headquarters on May 16-17. This event aims to leverage the current weak yen, the influx of foreign tourists in Japan, and the fourth Korean Wave to support Korean premium consumer goods companies entering the Japanese market.

LOFT, Japan's largest variety store chain, operates 163 stores nationwide. In 2022, LOFT's sales reached 93 billion yen, recovering to pre-COVID-19 levels. The number of stores in Japan increased from 133 at the end of 2020 to 161 by the end of 2023.

This consultation will feature 43 Korean companies across five consumer goods categories: beauty, stationery, household goods, fashion accessories, and character products. LOFT's purchasing managers, along with representatives from Japan's largest beauty vendor Ooyama, will review Korean products and select companies to feature in LOFT's online and offline stores.

LOFT previously held a 'Korean Beauty Festival' in April, focusing on Korean cosmetics. In October, they plan to expand the event to include a wider range of Korean consumer goods. This marks the third time LOFT has hosted a Korean product event, reflecting the growing demand for high-quality Korean products.

Kim Sam-sik, head of KOTRA's Japan regional headquarters, stated, "The fourth Korean Wave in Japan and the influx of foreign tourists are driving demand for high-quality Korean premium consumer goods in Japan's major distribution networks. We are committed to supporting more Korean companies in entering the Japanese market."

LOFT's purchasing manager added, "We are actively seeking excellent products across various consumer goods categories in addition to Korean beauty products. We look forward to a successful collaboration with KOTRA to introduce outstanding Korean products to the Japanese market."