Korean Beauty Trends & Industry News: 25-05-26

Online Cosmetic Ads Caught for Misleading Claims 237 Cases Blocked

    The Ministry of Food and Drug Safety, in collaboration with the Korea Cosmetic Association, recently investigated online cosmetic advertisements and discovered 237 violations involving misleading expressions such as "doctor-recommended," "hospital-exclusive," and "hospital-recommended." These were determined to potentially mislead consumers by falsely implying pharmaceutical efficacy or medical endorsements.

Types of Violations and Findings

The crackdown identified the following key types of infractions:

1. Doctor/hospital-based endorsements (91 cases, 38.4%) : Phrases like "recommended by Dr. XX," "hospital-exclusive," or "hospital-recommended" were used to falsely bolster consumer trust.
2. Pharmaceutical claims (114 cases, 48.1%) : Ads promoting cosmetic products as having effects such as “anti-inflammatory,” “skin regeneration,” or “relief from skin inflammation” were seen as potentially misleading, blurring the line between cosmetics and pharmaceuticals.
3. General cosmetics posing as functional cosmetics (32 cases, 13.5%) : Ads promoting ordinary cosmetics with expressions like “wrinkle improvement” misrepresented the product’s approved functionality or differed from approved claims.

The ministry has asked the Korea Communications Standards Commission to block access to these listings. It will also conduct on-site inspections and administrative actions for the 35 responsible companies.

Updated Guidelines and Industry Response

According to the revised "Cosmetic Labeling and Advertising Guidelines" (as of January 2024), terms such as “certified by XX association,” “infused with XX hospital’s essence,” “developed by doctors from XX university,” and “hospital-exclusive” are now strictly prohibited.

This move aims to prevent consumer misinterpretation and ensure transparency. Moreover, the Fair Trade Commission’s updated review guidelines, effective from December 2024, mandate disclosure of financial relationships in social media advertising and influencer content.

Implications for Consumers and the Industry

This enforcement signals the need for vigilance in cosmetic advertising. Consumers should carefully examine ingredients and effects rather than be swayed by promotional phrases. Brands must ensure compliance and convey accurate information to build trust and avoid penalties.

Bukchon Emerges as an Experiential K-Beauty and Fashion Destination

    Seoul’s Bukchon Hanok Village, once known primarily as a traditional tourist site, is now rapidly gaining attention as a hotspot for K-beauty and global luxury brands. It is evolving into a flagship zone where tradition and modern branding intersect.

Sulwhasoo and Scent Marketing Lead the Way

At the heart of the trend is the “Sulwhasoo House of Bukchon,” located in a nearly 100-year-old hanok. The site features exhibitions, retail, and fragrance workshops. With over 300 visitors daily and popular scent-making classes fully booked within five minutes of release, it has become a must-visit for international tourists.

International fragrance brands are also joining the movement. Estée Lauder’s Le Labo is set to open its second flagship store in Bukchon, alongside other niche fragrance outlets like Tamburins.

Revitalized Commerce and Consumer Buzz

Following a downturn after the 2016 political scandal, Bukchon’s commercial activity is rebounding. Seoul's real-time city data shows that monthly transaction volumes in the area jumped from 1.9 billion KRW in January to 2.57 billion KRW in April, with projections surpassing 3 billion KRW in May.

The opening of beauty concept store “Wires,” run by KoreaTech (parent of the brand “Gahi”), has further energized the district. It offers product testing and complimentary personal color consultations, attracting over 1,000 visitors each weekend.

Global Brands Embrace Hanok-Based Marketing

International brands are integrating hanok architecture into their retail experiences. Adidas launched its “Bukchon Heritage Store” in August 2024, offering Korea-exclusive products. New Balance and Dr. Martens also operate hanok-inspired spaces, combining product sales with curated cultural exhibitions.

Korean designer brands such as Andersson Bell, Howas, and Asser operate showrooms that have become social media-worthy destinations, adding to Bukchon’s growing appeal.

Tradition Meets Branding

Unlike other trendy districts like Seongsu or Hannam, Bukchon offers a unique cultural anchor — tradition. It has emerged as the ideal place for immersive branding and storytelling, helping brands communicate deeper narratives in a setting rich with history.

Olive Young Festa Evolves into Korea's Largest K-Beauty Industry Convention

    From May 21 to 25, CJ Olive Young hosted the “2025 Olive Young Festa” at Nodeul Island in Seoul's Yongsan District. Over the five-day period, the festival drew approximately 33,000 general attendees and 3,700 beauty professionals, influencers, and global buyers, reinforcing its reputation as the largest convention in Korea’s K-beauty sector.

A New Format: Industry-Wide Participation

This year’s festival spanned 3,500 pyeong (approx. 11,570㎡), transforming Nodeul Island into a vibrant showcase of 108 health and beauty brands under the theme “Treasure Island.” Olive Young emphasized that the event evolved into an “industry convention,” where all key stakeholders—brands, consumers, buyers, and professionals—could collectively explore the present and future of K-beauty.

Business-Focused Sessions: Future Connect

The event featured “Future Connect,” a lecture series designed to provide brands with practical insights and business strategies. About 150 industry members attended to learn from topics like global ingredient trends, overseas market strategies, and import/export compliance.

Cell Fusion C CEO Lee Jin-soo stated, “The sessions offered insights on everything from global trends to customs procedures, which were directly applicable to real business. If Olive Young continues to guide brands in global expansion, it could present a huge opportunity for small-to-midsize K-beauty firms.”

Olive Young also invited 400 global platform representatives—including Amazon (U.S.), Aeon and eBay Japan (Japan), and others from Hong Kong and Southeast Asia—to help Korean brands gain overseas traction.

Brand-Consumer Engagement: Beauty & Health Deep Dive

“Beauty & Health Deep Dive,” a series of hands-on sessions including talk shows, live makeup demos, and one-day classes, allowed direct interaction between consumers and brand leaders. A fan of Arencia, a brand known for its rice cake soap cleanser, said, “It was rare to speak directly with the CEO and learn about the product development process and vision. I was really impressed.”

The event also expanded its scope by featuring promising emerging brands alongside Olive Young Awards winners. Booths were organized around trending categories like “slow aging,” “inner beauty,” and “active skincare,” enabling a comprehensive look at current K-beauty movements.

Olive Young CEO Lee Sun-jung commented, “This Festa reaffirmed K-beauty’s global potential and brand fandom power. Going forward, we will continue serving as a platform that connects and strengthens the K-beauty ecosystem.”

Shinsegae and Ascend EP Acquire 40% of C&C International to Enter Color Cosmetic ODM Market

    Private equity firm Ascend Equity Partners (Ascend EP) has signed a 285 billion KRW deal to acquire a 40% stake in C&C International, a Kosdaq-listed company specializing in color cosmetic ODM (Original Development Manufacturing). The acquisition includes a 20% share purchase from Chairman Bae Eun-chul’s family for 140 billion KRW and the issuance of 145 billion KRW in new shares.

Investment Strategy and Future Use of Funds

Ascend EP plans to establish a fund, with Shinsegae joining as a strategic investor. Through a Special Purpose Company (SPC), this fund will become the largest shareholder of C&C International. Although Shinsegae has confirmed its participation, the exact investment amount has not been disclosed but is expected to be in the hundreds of billions of KRW.

Of the 145 billion KRW to be raised via new shares, 45 billion KRW will be used to expand production facilities at C&C’s Cheongju plant, and 100 billion KRW will be allocated for M&A activities and overseas network expansion, including acquiring base cosmetic ODM firms and investing in brand equity.

Background and Strategic Synergy

Ascend EP had previously invested 30 billion KRW in C&C in 2023. The two also co-invested in Pharrell Williams’ unisex skincare brand Humanrace, aiming to support both color and skincare product development. Ascend EP is known for strong overseas fundraising capabilities, having partnered with China International Capital Corporation (CICC) and other institutional investors.

C&C International is known for its strength in lip cosmetics, which accounted for 68.4% of its 2024 sales. Approximately 30% of its revenue comes from North America. The company’s client base includes more than 100 domestic and international beauty brands.

Through Shinsegae's extensive retail and marketing infrastructure—including E-Mart and Shinsegae International—C&C’s reach is expected to expand rapidly. Shinsegae recently gained traction with ultra-low-cost cosmetics through a partnership with LG Household & Health Care, highlighting the group’s growing interest in beauty.

This acquisition positions Shinsegae to strengthen its non-food portfolio while establishing a long-term foothold in the global cosmetics ODM market.