Beauty and Fashion Companies Break Through COVID-19, Expanding Overseas and Overseas

[Asia Economy Reporter Yujin Cho] Amid the adverse effects of the novel coronavirus infection (COVID-19), domestic beauty and fashion companies are seeking new opportunities by expanding into overseas markets. As the domestic market becomes saturated and the prolonged COVID-19 situation worsens the growth environment, these companies are accelerating their overseas strategies.

◆ Turning crisis into opportunity... Going abroad = According to industry sources on the 4th, Lee Kyung-soo, chairman of Cosmax, a domestic cosmetics original design manufacturer (ODM), is personally overseeing overseas operations by participating in video conferences with overseas subsidiaries. He went on a business trip to visit the U.S. subsidiary for about 20 days in January this year, but as overseas travel has recently been blocked due to COVID-19, he is directly participating in video conferences to manage the business. A Cosmax official said, "We regularly communicate through video conferences with subsidiaries in the U.S., China, and Southeast Asia," adding, "Top executives including Chairman Lee personally participate in these video conferences."

Lifestyle specialist company Greeti's lingerie brand Wonderbra is focusing on strengthening its presence in the Chinese market. From the second half of this year, it plans to intensify digital marketing using Wanghong (famous influencers) in China.

A Greeti Wonderbra official said, "We plan to expand marketing by actively utilizing social influencers, including Wanghong who have significant influence on Chinese consumers, and to pursue strategic partnerships with multiple online distribution channels in China." Unlike Korea, China has no dominant brand in the lingerie market, with the top brands holding less than 5% market share, and the online purchase rate of lingerie exceeds 50%, indicating rapid growth in the online market and high market potential.

Greeti's Wonderbra is present on major online platforms including Alibaba's Tmall, JD.com, and VIP. Not only Wonderbra but also other lingerie brands under Greeti such as Playtex and Just My Size have already entered the market. Among domestic lingerie companies, Greeti is the only one generating meaningful sales in the Chinese market. A Greeti official said, "We plan to further strengthen localization targeting China to enhance competitiveness and expand the range of product categories for entry." Wonderbra, known as the original "Ppongbra (volume bra)," is a U.S. lingerie brand for which Greeti holds the license and exclusive distribution rights.

◆ Land of opportunity, Southeast Asian market = Neopharm is focusing on overseas markets as its management battleground this year and is concentrating on strengthening its global capabilities. Neopharm operates body moisturizing brand Dermabee and dermocosmetic brand Real Barrier. Dermabee, famous as the No.1 body moisturizing brand at Olive Young, made its first entry last month through Guardian, a local health and beauty (H&B) store in Singapore, and Real Barrier is preparing to enter 'Binsina' in the United Arab Emirates (UAE) in the second half of the year.

Dermabee plans to expand its presence in the Southeast Asian market based in Singapore. A Neopharm Dermabee official said, "Since winning the Olive Young Award in 2018, Guardian has shown interest, and we have collaborated with Southeast Asian partners to enter overseas markets," adding, "Guardian serves as the headquarters in Singapore and is the most influential market affecting brand operations in neighboring Southeast Asian countries, so we are considering further expansion into Southeast Asia." The Southeast Asian market is considered to have high growth potential as the region experiences skin dryness concerns due to year-round air conditioner use.

Dongkook Pharmaceutical's cosmetics brand Centellian24 is exploring direct entry into the Thai and Philippine markets in the second half of this year. A Centellian24 official said, "We are preparing to launch offline stores in Watsons and plan to expand sales channels in the future." Last year, Centellian24 successfully entered offline large malls such as Costco and individual beauty shops in the UAE, Mongolia, and Japan, and is preparing to expand into other distribution channels. The official added, "With overseas travel blocked due to COVID-19, we are conducting key meetings through video conferences with local partners," and "We plan to expand our overseas business base and increase the number of sales channels and countries entered in the future."