Not Yet Recovered

Sulwhasoo (left) and Whoo, two popular cosmetics brands from Korea
Sulwhasoo (left) and Whoo, two popular cosmetics brands from Korea

The June 18 Shopping Festival in China is approaching, but Korean cosmetic products continue to suffer sluggish sales there. This is because cosmetics consumption in China has not fully recovered and polarization has been strengthening in cosmetics shopping between choosing budget Chinese brands or luxury foreign brands.

According to Alibaba’s e-commerce platform Tmall on June 6, Chinese cosmetics brand Proya generated more than 100 million yuan (about 18.4 billion won or US$14.0 million) in sales within the first hour of its pre-order event for the June 18 Shopping Festival, following Estée Lauder (U.S.), L’Oreal (France), and Lancome (France).

Analysts estimate that Proya ranked second overall in cumulative sales of cosmetics during the pre-order period. The high-end skincare market in China is dominated by foreign brands, so it was unusual for a Chinese brand to rank second overall.

Unlike other Chinese brands that target the mid-to-low-end color market, Proya’s skincare sales account for 70 to 80 percent of its total sales. Although it could not break into the top five until 2021, the brand made the top five list for the first time in cosmetics transaction on Singles’ Day (Nov. 11) in 2022 and then topped the list during Women’s Day on March 8, 2023.

Along with the rise of local brands, beauty products from luxury brands have been enjoying strong sales. In a Tmall pre-order event, Chanel sales increased by 70 percent year on year and Dior sales by 50 percent, while Unilever’s prestige beauty brand Hourglass surpassed its sales in 2022 in the first hour. Diptyque, a niche perfume brand, also broke its sales record set in 2022 in the first 90 minutes.

In contrast, Korea’s top cosmetics brands such as LG Household and Health Care’s Whoo and Amorepacific’s Sulwhasoo have not created a big sensation in China since the outbreak of the COVID-19 virus and a ban on the Korean Cultural Wave.

According to the Korean Ministry of Trade, Industry and Energy, Korea’s cosmetics exports fell 8 percent year on year in May. While this drop is an improvement compared to last year’s 13.3 percent decline, Korea’s cosmetics exports have been on the wane as a whole.

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