Cosmetics giants advised to launch tailor-made products

By Kang Hyun-kyung

Korean cosmetics companies seeking to expand into the Middle East need to develop tailor-made skincare products rather than simply shipping existing ones designed for Koreans to the region. This is one of the tips from experts familiar with the Middle Eastern cosmetics market.

Alshaima Mohammed, the founder of e-commerce startup Daehan Arabia Marketing in Seoul, said Korean companies need to produce skincare products suitable for the local people’s skin tones and types if they want to succeed with customers in the Middle East. Unlike Koreans, she said that many Middle Easterners have oily skin.

“A sweaty makeup meltdown is one of the worries of Middle Eastern women when they put on makeup during the summer,” the United Arab Emirate national said. She started her own business in January after completing her master’s program in computer science at Korea University in Seoul. “In the UAE, for example, we have only two seasons — a long summer followed by a three-month winter that starts in December. Depending on the weather, the average summer temperature hovers near 60 degrees Celsius,” she said. “So Emirati consumers usually ask if skincare products can help them avoid a sweaty makeup meltdown during the sultry heat.”

Alshaima Mohammed, the founder of e-commerce startup Daehan Arabia Marketing in Seoul / Korea Times

Korea’s leading cosmetics companies, AmorePacific and LG Household and Health Care, had made a flurry of announcements last year about expanding to the Middle East. Spending on beauty and skincare products in the region has increased in recent years, turning it into a goldmine, especially for Korea.

This increased spending was caused by a rising young population with disposable income. The lifting of the nuclear-related sanctions on Iran in January is expected to further push up demand for cosmetic products there, another market development that favors cosmetics companies.

The other factor of the Middle Eastern market that excites Korean companies is the popularity of Korean dramas and K-pop, which have made fans in the region interested in Korean skincare products.

Middle Eastern consumers, however, have expressed that such a positive outlook won’t directly benefit Korean companies and that there are things the companies need to work on before they enter the region.

Zohreh Kiaee, an Iranian Ph.D. student at Seoul National University, said Korean skincare products are relatively good, but the consumers there are not particularly impressed with Korean makeup products. She said she has used Nature Republic and Misha cosmetics for three years since she arrived in Korea for study and felt Misha products may appeal more to Iranian women because they have a more diverse product lineup and reasonable prices.

“I think Korean cosmetics products have the potential to appeal to Iranians because their prices are lower than those of other established European brands, such as French cosmetics brands,” she said. “But I think they need to be adjusted to Iranian tastes and styles. Most Iranians have darker skin than Koreans, and therefore, Korean companies need to consider this factor when they export cosmetics products for Iranian consumers.”

The Middle East is one of the fastest-growing cosmetics market in the world. Together with Saudi Arabia and the UAE, Iran is one of the top three cosmetics markets in the region.

Saudi Arabia, the UAE and Iran together represent a market worth a combined $9.5 billion, approximately 37 percent of the total for the Middle East and Africa. According to a 2015 report by global market research firm Euromonitor, a Saudi woman spends $3,800 a year on cosmetics.

The most popular items in Korea and the Middle East are different, which makes it necessary for Korean companies to localize products for regional consumers. Data show that Middle Eastern consumers love fragrance. Consumers in Saudi Arabia and the UAE are first and third globally in terms of per capita spending on fragrances. Compared with Koreans, Middle Eastern consumers also use more makeup, such as lipstick and eyeliner.

Mohammed said Korean cosmetics brands would benefit if they consider cultural elements when they promote their products in the Middle Eastern market. “Most Arab women cover their whole body, except their faces. But Egyptian women don’t wear scarves,” she said. This difference could indicate that Egyptian women may be more conscious of hair care products than other women in the region, she said.

She sells Korean cosmetics to Middle Eastern consumers through her Instagram account. She posts images of Korean cosmetics and other products that could appeal to those customers on her Instagram page and answers their questions regarding the products they are interested in. Upon receiving the orders, she purchases those products and ships them to the buyers.

According to Mohammed, Middle Eastern women are conservative consumers. “They rarely trust brands they’re not familiar with. They like French products because the brands are established. French products’ fancy packaging and opulent advertising also make them popular with consumers there,” she said. “I think building the image of a luxury brand is one of the key aspects that Korean cosmetics companies should focus on if they want to expand in the Middle East.”

Korean cosmetics companies have launched products targeting young consumers, the main consumers there. LG’s The Face Shop launched the cutie line of makeup products to attract consumers in their teens and 20s. It opened its first Middle Eastern shop in Jordan in 2006 and now has 55 stores in the Middle Eastern countries, including Saudi Arabia, the UAE and Oman. It posted approximately $6 million in sales from the Middle Eastern market last year.

The Korean brand plans to open stores in Qatar, Bahrain and Kuwait this year.

AmorePacific announced last year that it will enter the Middle Eastern market with the opening of its first store in Dubai later this year. Other Korean mass cosmetics brands, such as TonyMoly, also opened stores in the region.

To successfully market their products to the region, Mohammed said Korean cosmetics producers need to understand the local culture.

“Guess who’s going to pay for the cosmetics those young girls are buying. Their parents. This means that their parents have a greater say in what cosmetics their daughters buy,” she said. “This tendency, in turn, indicates that Korean cosmetics brands must create an image that encourages trust from the conservative Middle Eastern parents through the products’ design and packaging.”

She also said there are a few powerful bloggers who test cosmetics samples and posts their reviews on their blogs and their influence in the market is enormous.

“I think effective marketing in the Middle East doesn’t require a huge amount of money if they know how to make the most of social media,” she said. “Middle Eastern girls are heavy users of social media such as Instagram and Twitter so I think advertising their products through social media is another effective way to promote their products there.”