Hallyu boosts cosmetics sales overseas market
Cosmetics merchants tout their products in front of their shops in Myeon-dong, Seoul. / Korea Times file
Actress Song Hye-gyo appears in a commercial for a new product of Amore Pacific’s Laneige
By Shim Jae-yun
Apparently boosted by the growing popularity of “hallyu” (the Korean wave), the sales of domestically made cosmetics products in overseas markets have been increasing rapidly.
Cosmetics makers are making the most of the popularity of the so-called K-beauty, launching new products with brisk marketing tactics in overseas markets.
Industry sources say the “export effect” is all the more significant given that foreign tourists visiting here choose cosmetics on their preferred shopping list, mainly shopping at Myeongdong, the No. 1 destination for inbound travelers.
Exports of related goods amounted to $1.067 billion in 2012, up 30.3 percent from a year earlier, while imports remained at $978 million, according to recent data released by the Korea Pharmaceutical Traders Association (KPTA).
This was the first time cosmetics exports surpassed imports.
The cosmetics trade registered deficits of up to $400 million a year from 2002 to 2008. Overseas sales began to rapidly increase from 2009 to narrow the deficit to $254 million in 2010 and $184 million in 2011.
Sources attributed the fast rise in exports of cosmetics to the popularity of hallyu, mainly in China, Japan and Southeast Asian countries.
“The export of cosmetics, in particular, has a close relationship with culture. People tend to prefer products made in nations that they admire from a cultural perspective,” said Kim Kyong-ok, a manager in charge of exports at the Korea Cosmetics Association.
By nation, Japan was the largest importer of Korean-made cosmetics, purchasing $250 million worth of products, followed by China and Hong Kong, with imports of $209 million and $188 million, respectively.
Imports by Thailand and Taiwan stood at $65 million and $58 million, respectively, while Singapore and Malaysia registered $41 million and $33 million.
“Besides hallyu, the brisk sales in Asian nations reflect their preferences for the Korean products, which are suitable for their skin,” Kim told The Korea Times.
In addition to the effect of hallyu, domestic companies have made efforts to develop new products with state-of-the-art technology, coupled with advantages from the steady appreciation of the Korean won.
The steady rise in overseas sales proves the enhanced quality of domestic cosmetics, she said.
Domestic cosmetics firms are rolling up their sleeves to optimize the rapidly spreading hallyu in overseas markets.
Amore Pacific, for instance, has seen ever-growing sales of its products – Laneige and Mamonde. Laneige’s new product, Original Essence White Plus Renew, made debuts early this month simultaneously in both domestic and foreign markets including China, Hong Kong, Taiwan, Singapore, Malaysia, Thailand, Vietnam, the Philippines and Brunei.
This shows a different marketing pattern in that domestic firms had previously launched products in foreign markets one or two years after they debuted in the domestic market.
It is the first time that Laneige goods were launched in the domestic and foreign markets at the same time.
“The product is a whitening essence which got certificated from a test of some 1,200 Asian women over the past seven years. We have been receiving orders for more than 120,000 units of the cosmetics from abroad,” said an Amore Pacific official in charge of PR affairs.
As of the end of August 2012, Amore Pacific brands were put on sale in 1,030 department store counters and in 2,541 retail stores that are in operational in 216 cities.
A BB Cream from Missha has also continued to gain popularity as representative of hallyu. As of the end of last year, cumulative sales of the cream reached 20 million units, only six years after it first went on sale.
The product is sold in 31 countries, including China, Hong Kong and Japan, having been preferred by foreign tourists here.