Another Brand Joins the K-Beauty Exodus From China

What happened 3CE Stylenanda is the latest Korean brand to shut its doors in China. On June 18, the beauty and fashion company ceased operations in Beijing’s Sanlitun area following the expiration of its lease, leaving just two directly operated stores in the country. 3CE Stylenanda joins a growing list of K-beauty firms shrinking their physical footprint in the mainland during the pandemic, including Etude House and Innisfree. The Jing Take Unlike these more seasoned players, 3CE Stylenanda is a rookie by comparison. Founded in 2004 in South Korea, Stylenanda launched its makeup division 3CE in 2009, then entered China in 2019 after being acquired by beauty giant L’Oréal Group the year prior. But despite being new to the market, the business — favored by Asian Gen Z and Millennials — recorded over 15 million (100 million RMB) during Singles’ Day 2021, ranking third in sales among color cosmetics labels after Saint Laurent and Estée Lauder. In fact, it has over 12 million fans on its Tmall flagship store, signaling that mainlanders’ love for K-beauty is far from over. However, K-beauty still faces big obstacles to winning local consumers. Although products from South Korea are loved for their high quality, the market positioning of their brands can be vague. 3CE, for example, is best known for its young, vibrant packaging, wide selection of products, and partnerships with trendy idols such as Esther Yu and Simon Gong. However, the same could be said for Chinese beauty unicorn Perfect Diary, which boasts an even more aggressive marketing strategy. At the same time, 3CE has a limited physical footprint, with one of its remaining two locations in Nanjing opening just this month. It doesn’t help that the COVID-19 lockdowns hit maisons at large, reducing foot traffic to stores and delaying deliveries (in Q1 2022, China’s beauty market reported sluggish growth of 1.8 percent). The question then is: will 3CE’s store closure free up resources to focus on e-commerce — which is clearly one of its strengths? Or will downsizing brick and mortar be its first step towards disaster? The Jing Take reports on a piece of the leading news and presents our editorial team’s analysis of the key implications for the luxury industry. In the recurring column, we analyze everything from product drops and mergers to heated debate sprouting on Chinese social media.

Another Brand Joins the K-Beauty Exodus From China

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Published June 21, 2022

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Another Brand Joins the K-Beauty Exodus From China