South Korea's Amorepacific bets on luxury cosmetics for Europe push
today Jan 5, 2018
South Korean cosmetics company Amorepacific aims to expand in Europe by launching one of its luxury brands in Britain this year and in Germany in 2019, after introducing its products in France in 2017, a senior executive said.
Amorepacific, South Korea's biggest beauty firm, began selling its luxury Sulwhasoo brand of creams and other cosmetic products in Galeries Lafayette department store in Paris in September.
Thierry Maman, the head of the group's European operations, said its products should reach British department stores, such as Selfridges, this year, with Germany to follow after that.
Maman, hired by Amorepacific in 2015 from the perfume and beauty arm of LVMH's Givenchy, said the Paris outlet was "a good testing ground" as the label considered whether to open its own stores or offer its products through other shops.
"You don't become international from one day to the next," he said.
The group first tried to break into the French cosmetics market, one of the world's most competitive, 30 years ago but withdrew after just two years due to poor sales. It bought French perfume house Annick Goutal in 2011.
Maman said France was a tough market but added Sulwhasoo was betting on drawing customers with its traditional, herbal-inspired formulas.
South Korean beauty products, which have expanded in Asia and especially China, have gained a reputation for innovation and using natural ingredients, such as snail slime or tea leaves.
Other Korean firms have attracted foreign investors and pushed into Europe, such as Dr.Jart+, partly backed by Estee Lauder and whose products are sold in the beauty chain Sephora.
Rivals often offer cheaper ranges of skincare or make-up products, which are particularly popular with young consumers.
Amorepacific, whose products include a sponge applicator for make-up that has been mimicked by global brands like L'Oreal's Lancome, might offer more of its middle-of-the-range labels to Europe in future, Maman said.
Amorepacific's European revenues, including Goutal, were less than 50 million euros (£44.38 million) annually but were expected to rise by 20 percent in 2018, Maman said.
Amorepacific's sales were hit this year by diplomatic tensions with China that reduced Chinese tourists to South Korea.
Relations are now on the mend, but Amorepacific Corp's sales fell 8 percent to about 4 trillion won (£2.8 billion) in the year to September.
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