SEOUL, March 5 (Korea Bizwire) — “K-beauty” products are gaining a foothold in new markets outside of China and Southeast Asia.
While shipments to China comprises around 40 percent of all South Korean cosmetics exports, the geopolitical standoff over U.S. missile defense installations last year has spurred on companies to establish a presence in Africa, Latin America and Russia.
According to the retail industry, national trade promotion organization KOTRA’s support program for South Korean cosmetics firms looking to enter African markets received three applicants for every one spot available.
Last December, KOTRA arranged for the distribution of South Korean cosmetics with major retailer Woolworths.
The African economy is on the rise, powered by the young middle class, and South Korean cosmetics sales are growing, in particular makeup products.
One cosmetics firm affiliate said, “As of yet, there are few manufacturers of cosmetics that match the skin tone of Africans. Localization and active marketing will be key factors since the growth potential of the market is there.”
South Korean cosmetics are gradually proving they belong in Latin America’s stores.
Brazil is viewed as an advantageous opportunity; compared to the past, when tariffs and other government policies coupled with a depressed economy rebuffed South Korean export, the Brazilian economy is showing signs of revitalization and authorities are showing a greater willingness to open up their markets.
In Mexico, a K-beauty store selling goods from South Korean cosmetics SMEs at department store El Palacio de Hierro opened last year. With the department store having to place additional orders to restock sold out product lines, the reception from Mexican customers has been positive.
In Russia, where European luxury cosmetics brands have enjoyed comparative popularity, economic woes have opened the door for South Korean cosmetics, which are perceived as offering high quality at affordable prices.
K-beauty exports to Russia in the past few years have risen at an impressive rate. Export growth was 63.75 percent in 2016 compared to the year prior.
South Korean manufacturing and marketing of cosmetics is reported to be of great interest to Russian buyers.
One cosmetics industry insider said that in addition to the Korean wave, global recognition of South Korea’s abilities in advanced industries has contributed to increased trust in domestic firms.
“As part of an OBM firm that develops cosmetics brands, we are regarded with keen interest abroad,” the insider said.