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    Features

    Passport to Beauty: Destination South Korea

    South Korea has become the hotbed for beauty innovation, and global brands are clamoring for a piece of the action.

    Joanna Cosgrove, Contributing Editor02.06.15


    The Easy Cushion from Easy Powder is ultra-light and filled with multi-functional foundation.
    Beauty products from South Korea (commonly referred to as “Korea”) are characterized by otherworldly formulations and trend-bending packaging—and beauty consumers around the world can’t seem to get enough of them. As the birthplace of the BB cream craze, the excitement over Korean beauty products has global beauty brands looking eastward, both for new product concepts and outside-the-box packaging inspiration.

    According to Mintel, the Korean beauty and personal care retail market posted 5.8% growth year on year to 2013, compared to just 2.1% for the UK and 3.9% for the U.S. “South Korea is one of the world’s most exciting and fastest-changing beauty markets, which is globally influential and trend-setting,” according to Jane Henderson, global president, beauty and personal care at Mintel.
     Sok-Min Yu, CEO of Cosmax USA, a leading South Korean cosmetics and skin care company with U.S. operations based in Solon, OH, said there are two reasons why the global appetite for Korean cosmetics has grown so considerably in recent years. “First is because of its high quality products from advanced developments to meet picky and unique Korean consumers’ demands,” he says, “and second, because it has continued to develop products that are a global hit.”

    He went on to say that in the Korean beauty market, the brands showing the most stable growth are retail brands that are not owned by a big label. “These brands are unique in the sense that they work competitively to hold the top position in the market and therefore are quick to develop innovative products,” Yu said, pointing to BB creams as the most noteworthy example.

    Furthermore, he said, in comparison to European, American and Japanese cosmetic companies, Korean manufacturers have faster product development timeframes (about one to two months from brand concept origination to production), thorough localization strategies in each market, and preemptive capacity expansion in preparation for the increased demand.

    These shorter turnaround times are driven by a much shorter product lifespan as compared to that in the West. “In Korea, a three-year product lifecycle is long,” says Curt Altmann, marketing director, Yonwoo International/PKG, New York. “Marketers are constantly trying to find market segmentation though formula innovation, dispensing innovation and application innovation.”

    Interpreting Consumer Needs


     
    There are many points of differentiation between U.S. and Korean beauty consumers, with one of the biggest being the vested commitment Koreans make in their skin care regimen. In the U.S., women prize skin care products that combine simplicity and efficacy. In Korea, both women and men think nothing of spending large chunks of time (and money) on complex treatment regimens that span five to 10 products, including cleansers, toners, masks, essences/serums, moisturizers and mists.

    After having lived in Korea, Yonwoo/PKG’s Altmann found that Korean proclivity for skin care is deeply rooted. For instance, after researching the origins of Korea’s fondness for skin whitening products, Yonwoo linked the phenomenon to a cultural effect. “The desire for clean, white skin is deeply rooted in Confucian ideals,” Altmann says. “Also, the transition that Korea has gone through from largely agrarian economy to roaring industrial economy in just the last 35 short years mirrors the same transition in the west in the late 1800s-early 1900s when newly industrialized societies embraced the Victorian ideal of white porcelain skin and the “Gibson Girl” to emulate the affluence of higher classes who didn’t have to work in the sun.”   

    And while products including ingredients such as black sugar and egg cream face masks, bee venom mist for inflamed skin, and facial creams enriched with snail slime may seem odd or even off-putting to consumers in the U.S., South Korean beauty mavens swear by them—and their dewy, glowing complexions are proof of their efficacy.

    “Korean beauty products often have unique formulations that combine time-tested ancient ingredients, or methods of preparation with modern technology and delivery systems,” says Hilary Burns-LaRiche, marketing manager for Sulwhasoo, a top Korean skin care brand. “They often have a more holistic approach—meaning they are meant to be used as one step among the many steps that it takes to achieve ultimate skin balance.”

    Once the skin has been rendered a perfectly prepped canvas, makeup is applied to subtly enhance eye size, give height to cheekbones and sculpt youthful looking lips. While BB and CC creams have become a mainstay in Korean makeup, all signs point to air cushion makeup as the next trend. “This is a liquid foundation soaked in a sponge featuring a makeup base, sun protection, and skin moisturizer all in one product,” explains Catherine Spillman, commercial attaché, U.S. Embassy, based in Seoul, South Korea. “Originally developed by IOPE in 2008, air cushion products now incorporate benefits such as cooling, soothing, shining, whitening and wrinkle improvement. The range of cushion cosmetics has expanded into cushion tint, cushion cleansing and cushion blush.”

    Packaging Snapshot

    A look inside the dynamic Korean beauty packaging scene reveals how shifting consumer attitudes toward beauty continue to influence the innovation put forth by packaging suppliers and beauty brands.

    “South Korean beauty products and cosmetics [are] more focused on aesthetics to make consumers feel like they are buying luxury brand cosmetics, in both product and packaging,” observes Yoolie K. Park, director of sales and marketing, Nest Filler Packaging, Buena Park, CA, “so the decorative capabilities of South Korean manufacturers are superior.”



    The Penthouse Group created a unique applicator for Cover Girl that delivers a quintessentially Korean interactive, sensory experience.
    Spillman affirms the important role of packaging and adds that according to a survey released at the 1st International Cosmetic Packaging Seminar, held in Korea in June 2014, 85% of Korean woman responded that cosmetic packaging design is important, and 92% responded that packaging critically affects consumers’ purchasing behavior.  

    “Other takeaways from the seminar were that key elements of successful packaging include eye-catching appearance, design, shape, color, functionality, innovation, materials, efficient communication, multi-sensory appeal, appropriateness for the product, value, and additional benefits,” she says, underscoring that simple packaging runs the risk of appearing too plain and inexpensive to Korean consumers.

    Cosmax USA’s Yu agrees that packaging is considered to be an important element of building a brand image. “Customers…touch and use the product everyday so it is a window of communication with the brand,” he says. “Exciting new packages encourage use of the product and create brand perception as well.”

    Koreans also favor sustainable, eco-friendly cosmetic packaging. “One leading Korean company launched a product with a paper package based on extract made out of citrus peel normally discarded when making processed citrus food products,” Spillman says.

    Yu compared and contrasted Western packaging ideology with Korean packaging trends. “Western packaging design is simpler and focuses more on the fundamentals,” he says. They are also strong in providing eco-friendly, ‘give back to the nature’ solutions to their products and packaging of which Koreans are also following and adapting to their products as well. 
     


    Minjin’s LVM-No.7 is a battery-operated package that features an LED light and micro-vibrating action.
    “In comparison, Korean packaging design has more variety of style and design, but excels in using innovative packaging technology that works hand in hand with the product,” he continues. “As one example, one top herbal cosmetic brand in Korea creates luxurious packages that embody oriental genetics which defines their brand and product nature. This is hard to find in Western designs.”

    South Korean brands spare no expense with their packaging—especially custom packaging—and they are constantly introducing new products to keep their customers interested,” says Vonda Simon, CEO of SeaCliff Beauty Packaging & Laboratories, an Irvine, CA-based company that works with several Korean suppliers. “Their shapes are more extravagant meaning that they don’t stay within the norm of traditional round or oval; instead they create unique shapes and embellish their packaging much more than the U.S. brands do. They also seem to be the first to try new ideas in packaging such as refillable packaging and stackable components.”

    In addition to that penchant for luxe, Christine Ansari, vice president, key accounts/business development for Korea-based CTK Cosmetics, says sophisticated Korean consumers also love packaging that delivers more than just basic function, opting instead for packaging that offers multi-use functionality.

    CTK recently worked with a local luxury artist brand to develop the “Small Face Case” for VidiVici by Lee Kyung Min. “This component is a multi-tiered drawer system which allows the client to have several formulas or shades at his or her fingertips,” she said. “It provides the opportunity to have all the products you need to make a face look smaller, which is a key aspect to the function of the formulas all together.”

    The luxurious case delivers a sense of refined style thanks to a UV-metallized finish and an aluminum top plaque. The movement of each tier is engineered to move with ease and smooth mechanics. “This unique patented system provided the client with convenience, efficiency and trendy style,” Ansari says. It allowed us to expand the idea into other sizes including the ‘Makeup Styler’ which offered the client a smaller size pan for each of the formulas. This allowed the focus to be the color trend story, and add lips and cream based formulas for example.”



    The Dual Bottle from Minjin houses two chambers that enable two products to be filled into the same package.
    Steve Ostrower, president, The Penthouse Group, Freeport, NY, commented that Korean consumers also gravitate toward products that offer an interactive, sensory experience. To that end, his company recently launched a silicon type applicator puff for the brand new P&G Cover Girl Ultra Smooth Foundation. “Cover Girl’s innovative formula required an applicator [and] the key was material compatibility of the applicator with the formula so the consumer could achieve an ultra-smooth, even and flawless finish,” he explains.

    The Penthouse Group utilized its South Korean factory to source the necessary raw material and to manufacture the perfect applicator to pair with the makeup’s unique formula.

    Ostrower says the silicone applicator delivers a high-end experience to the consumer. “This product required a very special skin-like applicator in order to deliver the formula for a flawless and smooth finish,” he says. “The Cover Girl foundation is brand new and the formula drove the decision on the applicator. Without the right applicator the consumer would not achieve performance intended for this formula.”

    Cushion-based beauty product delivery is part of an exciting category of emerging and excitingly innovative, interactive products which include “vibrating” foundation, rotating/sliding compacts, heat-enabled mascaras, massaging eye applicators and multi-hole airless compacts.

    Seoul-based Easy Powder Co. Ltd. has been manufacturing cosmetic puffs for 50 years, and recently produced a puff packaging hybrid called the Easy Cushion in conjunction with a well-known Korean makeup artist. According to the company’s Jina Kang, it is ultra-light, sanitary and filled with multi-functional foundation.



    HCT Packaging pairs its Cooling Tip Technology with Pum Tech’s airless componentry to create a soothing, cooling applicator.


    Cosmax combines innovative formulas with outstanding packaging.
    Minjin Co. Ltd. of South Korea developed the LVM-No.7, a battery-operated, 12ml package that features an LED light and micro-vibrates (12,000 times/minute) to deliver a mini massage during homecare treatments.

    The company also markets Dual Bottle, a cylinder-shaped package that houses two chambers within the bottle. This configuration enables two products to be filled into the same package, a concept that is of particular interest to the cleansing cream market, which often pairs two different formulas that cannot be mixed together easily.



    Sulwhasoo’s Snowise EX Brightening Mask is formulated with white ginseng to brighten the skin.


    Sulwhasoo’s Luminature Essential Finisher was created using a 1,500 year tradition of ‘beauty water’ and is applied as the last step of the skin care regimen to “boost the natural radiance from within.”
    Lou Della Pesca, president, 3C Inc., Hawthorne, NJ, says innovation in the airless realm has given brands new formulation freedoms. “The introduction of the airless bottle and the latest airtight compacts originating in Korea, now enable companies to improve formulations for both beauty and personal care products,” he says.

    Santa Monica, CA-based HCT Packaging Inc. partnered with Pum Tech Korea Co. Ltd. to pair Pum Tech’s airless components with HCT’s patented Cooling Tip Technology, which utilizes a “cool tip” made from materials such as zamac (an alloy comprised of zinc, magnesium, aluminum and copper) and ceramic. “These materials are cool at room temperature so they have a very soothing effect when used to apply products such as under-eye cream,” explains Jenny Hsu, HCT Packaging’s senior director, strategy and operations, who notes that the cooling effect is achieved without refrigeration. “We first launched the Cooling Tip Technology on tubes, but have since expanded the product offering to include airless pumps, tottles and click pens.”

    Before the Korean trend wave, packaging that displayed a traditional Korean aesthetic was difficult to market to the U.S. consumer. “However, since the West has been looking to Korea as an authority on skin care and beauty recently, having overtly Korean packaging has become a unique selling point,” comments Sulwhasoo’s Burns-LaRiche. “Packaging that has Korean language on it or is extremely eye-catching as a great deal of Korean packaging is, definitely is having a moment in the sun with U.S. consumers.”

     SeaCliff’s Simon aptly buttons up the benefits of why partnering with Korean companies can fruitfully benefit all parties involved in the beauty segment. “They offer top quality products and …don’t just copy other companies’ styles like you see from China many times,” she says. “Koreans develop many packaging innovations and styles that are completely unique to the entire beauty industry. Their decoration capabilities are amazing and they are very consistent in their work.”




    Making the Most of Free Trade

    In January, ICMAD and U.S. Commercial Service offered a webinar on Selling Cosmetics in South Korea in an effort to introduce companies to overseas markets. Opportunities in South Korea were of particular focus, especially as it related to the 2012 implementation of the free trade agreement between the U.S. and South Korea, which ICMAD termed “the most commercially significant free trade agreement for the U.S. in almost 20 years.”

    Under the new free trade agreement, almost 80% of U.S. exports to Korea became duty free in 2012, including consumer products. “Total imports of cosmetics to Korea in 2013 were estimated to be $994 million,” says Catherine Spillman, commercial attaché, U.S. Embassy, based in Seoul, South Korea. “Of these, U.S. imports were $285 million, representing approximately 29% of import market share. On a country by country basis, the U.S. is the lead importer, followed by France ($257 million) and Japan ($134 million).”

    Of particular interest for U.S. exporters: Korean tariffs on imported U.S. cosmetics such as lipstick, eye makeup, face powders, and nail polish went from 8% before the free trade agreement to zero in 2014, increasing opportunities for U.S. firms. This added reduction in South Korean tariffs and tariff-rate quotas on goods is expected to add $10-$12 billion annually to the U.S. GDP and approximately $10 billion to annual exports to South Korea.

    “According to a report published by the Korea Health Industry Development Institute (KHIDI) in October 2013, U.S. exports of skin care cosmetics (HS Code 3304991000) and certain hair care products (HS Code 3305909000) went up 21.5% and 11.4% respectively in the first 18 months after the March 2012 implementation of the KORUS FTA,” she added.

    For information about assessing and developing international opportunities, log onto http://export.gov/salesandmarketing/index.asp. For those interested in exporting U.S. cosmetics or other products to Korea, please contact Office.Seoul@trade.gov.
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