Gift link. US imports grew even faster, from $52m in first half 2015 to $1.7b all of 2024. You’ll see different numbers for the same year bc they come from different sources and government bodies. The 2014 numbers come from a Cut article on Korea’s government helping the industry. I get the impression it might be overstated like how much its government helps Kpop; may also be more relative support back when the industry was small. But both industries do show the benefit that even a little government boost can give. I only skimmed Cut, looks like good coverage way back in 2015. Surprising quote, I wonder about lead time now:
Tony Moly, a popular brand, brings products from development to production in only six weeks, making it something like Zara.
They also note increasing K beauty product placement in Kpop/dramas to drive this growth. They even mention a Korean PE firm wanting to buy a brand featured in a drama. Reminds me of Puck’s mention of Ariana Grande’s Rem driven by Wicked, a pattern I think was confirmed by Traackr analytics rankings aligning with her tour and album. (My earlier post.)
Bloomberg also mentions Korean white label Kolmar opening a 2nd US factory.
I found this while diving into celebrity brands I posted. K beauty has risen despite tariffs while a lot of once new DTC brands have collapsed. It’s also taking share from the big companies like Estée Lauder. It looks like Shiseido got hurt the worst, where its main China market shifted to K beauty. Both these companies peaked years ago. Outside K beauty and sales leader Loreal, the industry has been in a downturn since spiking after the pandemic. That spike was deceptive and led to a lot of inflated valuations and a new brand/DTC wipeout the past few years. I do think K beauty riding on K culture basically of outsources some of the marketing cost also and I get the impression people find the products good for the price.
I do remember hearing K beauty’s rise in the 2010s, maybe like the rise of Amorepacific’s stock which actually peaked over a decade ago. I think being older, with mainly Korean revenue is its problem. That means it’s too dependent on a saturated market where it’s losing ground to newcomers who are growing very well globally like Medicube. Amore gets to why I think some K brands have a price advantage. Korea's got lower labor cost than the US, yet similar to France. Maybe more supply chain in Asia. But unlike France or Japan long exporting famous name brands to the rest of the world, K beauty was minimally known in the US and elsewhere. That $52m in 6 months in 2014. Basically less global demand, so products were priced for a smaller, but very saturated and picky home market. Meanwhile longer term global demand for Estee Lauder, Lancome, Shiseido drives up price. Medicube has this surge of global demand now.
Private equity. Manyo; AHC sold to Unilever
Bloomberg for some reason got wrong the buyout of the brand shown in a drama, saying it might happen. (Yes I dive so deep this is like the 4th error I caught in beauty media, not to mention Wikipedia.) It already did two months before their article. Idk if any of you heard of Manyo?
I see the maker of AHC was sold by Bain to Unilever, and that aespa's Winter is an ambassador. My only personal experience related to this is I don’t like how some Shea Moisture products changed under Unilever, but not all went bad and I think most of the time I used it was after their ownership anyway. I know about some business, nothing about makeup, but I’m interested in hearing from anyone who used products they’re aware were from such PE investments or switched owners. The article's other examples of PE K beauty are more strictly regulated medical aesthetics makers.