CJ Olive Young Delivers Beauty with K-Pop to Target North American MZ Generation

K-Content Popularity + High Exchange Rates Continue... Rising Demand for Direct Overseas Purchases
Synergy Between K-Pop and Health & Beauty (H&B)
Olive Young Global Mall Sales Up 77% from Jan to Oct
K-Pop Category Album Sales Quadruple in October

At 'KCON 2022 LA' held in Los Angeles, USA, local attendees visiting the CJ Olive Young booth to experience K-beauty are posing for photos (Photo by CJ Olive Young).

[Asia Economy Reporter Yuri Kim] Riding the 'New Hallyu Wave,' K-content is gaining popularity, leading to increased interest in the Korean lifestyle. Especially amid the recent sustained high exchange rate situation, reverse direct purchasing, where overseas consumers?mainly the MZ generation (Millennials + Generation Z) in North America and Australia?buy Korean products through online malls, is drawing attention. A noticeable synergy effect is emerging between K-pop, the main driver of the New Hallyu, and health and beauty (H&B), a key interest area of the MZ generation, the primary consumer group of K-pop.

According to CJ Olive Young on the 29th, sales at the global mall operated by Olive Young increased by 77% from January to October this year compared to the same period last year. The newly established K-pop category in the global mall in August showed remarkable sales growth. Album sales in October surged more than fourfold compared to August, the launch month. Customers who purchased both K-pop albums and K-beauty products accounted for 76% of all buyers.

Last month, the best-selling product on Olive Young's global mall was the second mini-album 'Antifragile' by K-pop artist LE SSERAFIM, followed by 'Spot Serum' from the domestic small and medium cosmetics brand ISOI in second place. Among the top 10 bestsellers, four were K-pop albums and six were K-beauty products, evenly distributed. Over 80% of buyers were from North America and Australia. It is also notable that most buyers were local foreigners rather than Korean expatriates. The sustained strong dollar phenomenon has relatively increased the purchasing power of North American consumers, along with steadily rising interest in K-content.

Since its launch in June 2019, Olive Young's global mall had about 30,000 members in its first year but has grown to surpass 600,000 members as of the end of October this year. With the establishment of the K-pop category and an increase in product offerings, the number of items handled has grown from around 2,000 in the first year to 15,000 recently.

According to the Korea Customs Service, last year, the number of overseas reverse direct purchase transactions reached a record high of 40,497,000. This year, with the dollar maintaining its strength, the record set last year is expected to be exceeded. The amount of overseas reverse direct purchases also increased 1.5 times year-on-year to $1.74518 billion last year. A distribution industry official said, "As the overseas reverse direct purchase market rapidly grows, domestic distribution companies' investments will also expand," adding, "The strategy of naturally increasing interest by listening to Korean songs while simultaneously handling Korean cosmetics, health foods, and other products to create synergy will remain effective for the time being."