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Beauty Innovation in Asia

By: Sarah Chung
Posted: January 27, 2014, from the January 2014 issue of GCI Magazine.

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Alicia Yoon and Cindy Kim, cofounders of Peach and Lily, an online retailer dedicated to Asian products, started their e-commerce site as a result of growing interest in Asian skin care products that are not widely available in the U.S. They commented on the advancements of South Korean R&D labs, a country minted as the “new France of skin care” for formulation bases, “hero” ingredients and application technologies.

While most beauty products use distilled, pure water as a base, South Korean beauty labs have been able to use cutting-edge solutions like tree sap or thermal water as the base. In addition, some of the hero ingredients being used by Korean brands boast anti-aging, firming, hydrating or blemish-healing properties, and those ingredients include snail extract, starfish extract, herbs indigenous to the Asian region, unique floral extracts, yeast extracts and fruit stem cells.

Furthermore, Yoon and Kim also noted that South Korean beauty labs are famous for some of the most advanced beauty applicators. Notable inclusions are products that are twisted out of containers, cushion compacts that stay constantly moist and bacteria-free, ergonomic grips on eyeliners, lipsticks that apply with clean spatula-like devices, and vibrating puffs to help skin absorb makeup and skin care products.

The Influence of South Korea

As South Korean beauty labs continue to innovate, many companies also are no longer looking to the West as the promised land for expansion, primarily thanks to the booming business in other parts of Asia. China accounts for over 40% of South Korea’s cosmetics exports, while Japan is its second-largest importer. In fact, South Korea has emerged as Asia’s trendsetter in the fashion, entertainment and beauty industries, supplanting Japan as the primary source of Asian cool. South Korea’s cultural exports have struck a chord in the heart of young generations across Asia. Cultural exports—including films, comics and computer games—hit a record $4.2 billion in 2012, up from $2.6 billion in 2009. Television dramas, singers and actresses have revamped the country’s image into a glamorous destination, and the trends in Seoul inspire the purchasing of the young and newly affluent consumers in places like Bangkok, Beijing and Jakarta.

Due to South Korea’s recent cultural boom, Korean beauty brands are coveted in many parts of Asia, and are viewed at a premium in its neighboring countries, including the massive Chinese market. Last year, South Korean beauty conglomerate AmorePacific jumped 34% in its year-on-year results, outperforming market leader L’Oréal’s 13% increase, second-ranked Shiseido Co. Ltd.’s 12% rise and third-ranked P&G’s 5% growth.

Given this popularity, South Korean beauty brands such as The Face Shop, Innisfree, Etude House, Tony Moly, Missha and Banila & Co. are opening stores across Asia at a dizzying rate—with no slowdown in sight. Due to their manufacturing history, South Korean firms often are able to produce products cheaper and more quickly than their Western counterparts. For example, AmorePacific’s budget brand Innisfree launched 100 makeup and 70 skin care products in China in the first half of the year alone, according to a Reuters report.

Of course, the popularity of South Korean products in the rest of Asia has direct implications for U.S. and European brands competing in important markets such as Japan, China and the Philippines. Many of the South Korean beauty products have lower price points, Korean celebrity spokespeople popular all over Asia and are designed for Asian skin.

In the meantime, expect to see more Asian beauty brands popping up stateside. “Asia is a hot bed of product innovation,” says Ron Robinson, founder of beauty search and discovery site He noted he is seeking out more niche brands from international beauty markets like South Korea. For example, O.R.G Skincare’s Park has seen a lot of success with his Organic Mineral Peel, a nonabrasive, spray-on exfoliator—an innovation from South Korea—and plans to launch more treatment facial mask products in early 2014.

In her role as CEO of Landing International, Sarah Chung advises brands on international business development strategies and planning. Chung has advised a wide range of consumer brands in beauty and fashion to launch their products to new markets. She also is cofounder and partner of Luxe Brand Advisors, an agency that helps market and distribute consumer products in Asia. Chung has been quoted as a market expert in leading industry publications such as The Wall Street Journal, Women’s Wear Daily (WWD), GCI magazine, The Rose Sheet, Australian Financial Review,, Luxury Daily, Korea Times and JoongAng Ilbo.