Korean cosmetics brands expand into foreign markets(69456)

Made-in-Korea cosmetics on the rise

NeoPharm, a local biopharmaceutical subsidiary of Aekyung Group, announced on Monday that it has landed a $500,000 deal to export specialized cosmetics brands to a retailer in the United Arab Emirates.

This export deal is meaningful, as it represents a foothold into the cosmetics market of Middle Eastern nations, said Park Byeong-deog, CEO and president of NeoPharm.

This is just the latest development in the continued expansion of Korea s cosmetics industry into global markets. The industry has made inroads into nearby emerging markets such as China and Vietnam, and data suggests Korean cosmetics have begun to penetrate markets such as the Mideast and South America.

Amore Pacific, Korea s No. 1 cosmetics firm, has seen success in China with its Laneige and Mamonde brands. At the high-end Sogo Department Store at Shanghai, the Laneige brand is situated on the first floor along with LG Household and Health Care s O Hui and Whoo brands.

Amore Pacific enjoys a solid standing in the Chinese market, with 2,010 Mamonde brand shops and 277 locations in department stores as of June. The more high-end Laneige has 180 locations in mainland China and 19 in Hong Kong.

Amore Pacific made headlines when its products went on sale in luxury department store Bergdorf Goodman in New York this year.

This move and others are interpreted as proof that domestic brands have enough competitive ability to be accepted in advanced markets.

Back in Asia, Vietnam has been the triumph of LG Household and Health Care, which has seen its O Hui and Whoo brands reign supreme. Currently, LG Health has a 15 percent market share in Vietnam s cosmetics market and a 70 percent share in the high-end cosmetics sector. LG Health s Vietnam exports rose from $15 million in 2006 to $22 million last year.

Export statistics back the trend. Korea Customs Service reported earlier this month that cosmetics exports soared 38.7 percent to $236.17 million in the first half from $170.33 million a year ago.

Other growth markets are Central and South America, as well as the Middle East - which have seen 170 percent and 30 percent increases in exports, respectively, in the first half of this year compared to last.

Experts say to keep this winning streak going, Korean companies will have to improve customer service.

Through customer relations management initiatives, it is important to build brand loyalty with customers wanting to buy the product again, said Na Woon-bong, professor at Kyung Hee University.

President of the Korea Cosmetics Association, Ahn Young-rim said more collaboration is needed. In order to create global cosmetics brands, this is the time when companies, academic circles and the government must work closely together to create new products.

Korean cosmetics brands expand into foreign markets

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