Korean Cosmetic Brand Sulwhasoo To Enter China Market

Parent Company Amore Has Seen Success In China With Premium Laneige Line

Sulwhasoo uses medicinal ingredients like ginseng and Korean herbs in its cosmetics

Sulwhasoo uses medicinal ingredients like ginseng and Korean herbs in its cosmetics

Along with pop music and soap operas, the “Korean Wave” also brought to new markets like China a flood of high-end cosmetic brands, intent on eroding the market share of established Japanese competitors and home-grown Chinese upstarts alike. Over the last 10 years, as China’s middle class has grown along with the premium placed on beauty, one of the South Korean brands that has benefited the most from increasing consumption has been one of the largest, Amore Pacific. Entering China initially with a mass-market focus designed to undercut more expensive Japanese, European and American brands, over the years Amore Pacific has introduced its more premium lines to capture a bigger piece of mainland China’s lucrative cosmetics market, which is expected to rake in about 80 billion yuan (US$12 billion) this year.

Having already found success with its budget-friendly Mamonde line and premium Laneige brand, Amore Pacific announced this week that it plans to introduce its high-end line, Sulwhasoo, to the mainland China market next year, beginning in March 2011 at the earliest. Taking a marketing approach remarkably similar to the one employed by Hermes’ new China sub-brand, Shang Xia, Sulwhasoo promotes its line of high-end cosmetics with the phrase, “Made One with Wisdom and Sangseng” — sangseng (相生 in Chinese) meaning, “the opposite harmony between two energies.”

Regular Jing Daily readers will remember that Jiang Qiong’er, CEO and artistic director of Shang Xia, mentioned at the brand’s unveiling that the name “Shang Xia” (”Up Down” in Mandarin) was chosen to express two opposing forces or sides — yin and yang, extraordinary and ordinary — that come together to strike a harmonious balance. Like Shiseido and several other Asian cosmetics brands, in addition to this Buddhism-referencing brand philosophy, Sulwhasoo promotes its use of natural ingredients, many of which are found in traditional Chinese and Korean medicine.

According to Amore Pacific president and CEO Suh Kyung-bae, Sulwhasoo’s expansion into the burgeoning China market is a key part of its global strategy, which centers on becoming one of the top 10 global cosmetics firms in the next five years. This August, the brand made its American debut, opening its first U.S. shop at Bergdorf Goodman in New York, and Sulwhasoo already has seven locations in Hong Kong — a popular cosmetics-buying spot for Chinese tourists. For its mainland China rollout, Sulwhasoo plans to get its full product lineup at an as-yet-unnamed “exclusive department store in mainland China,” and is shooting for March 2011 as the target date for its debut.

While Amore Pacific already has an impressive foothold in China, with Laneige sold in nearly 200 department stores throughout the country and the Mamonde available at nearly 400 department stores, the company will likely encounter more difficulty in the high-end luxury segment, which remains crowded and dominated by brands like Dior and Shiseido. As Amore Pacific sees it, however, the firm is simply ensuring it has a presence in every level of the Chinese cosmetics market. As Shin Min-ho of Amore Pacific told Korea’s JoongAng Daily, “So far we have had no representation in the luxury segment of the market in China.

“Now, Sulwhasoo will step in to fill that void.”

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Beauty