Amore Pacific, Korea’ top cosmetics maker, is now targeting the fast-growing Chinese market, devising a premium positioning strategy with its high-end herbal medicine cosmetics brand Sulwhasoo.
After successfully entering the markets in Hong Kong in 2004 and the U.S. in 2010, the brand Sulwhasoo made its Chinese debut this year.
An advertisement for Sulwhasoo at Shin Kong Palace, a Beijing department store.
A Sulwhasoo counter in Parkson Department Store in Beijing. (Amore Pacific)
Starting with its first branch at Parkson Department Store in Beijing in March, four Sulwhasoo shops have opened at luxurious department stores across China. Within the year, the firm plans to open up to eight other shops in major cities.
In Beijing on June 22, the company announced its ambitious goal of becoming “Asian beauty creator” in an official launch ceremony of the brand Sulwhasoo.
“Sulwhasoo is not just a cosmetic product but a brand that represents Asian culture and values. The brand also stands for the history and pride of the company’s study of herbal medicine over the past 50 years,” said Suh Kyung-bae, president and CEO of Amore Pacific, during the event.
“I’m sure that such brand values can be delivered to Chinese women as well. I hope many consumers feel happy through the beauty realized by Sulwhasoo.”
Suh added that the luxury cosmetics market in China is still at its early phase and has a huge growth potential, saying that China will lead the global market trend in five to 10 years.
The 1990s was the beginning period of the company’s Chinese business, while over the past 10 years it has successfully settled in the market establishing a stable earnings structure, he explained.
“Starting this year, the coming 10 years will be a period of a rapid growth and I’m sure that the premium brand Sulwhasoo will become a growth engine,” Suh said.
Last year, Amore Pacific logged 335.8 billion won in overseas sales, an 11.2 percent increase from a year earlier. Of them, the sales in China jumped 22 percent to record 149.2 billion won to make up almost half the total overseas revenue.
The company aims to double in size every two years in the Chinese market despite fierce competition with global brands. It hopes to become top three beauty companies in China by 2020.
Along with the new planned openings of Sulwhasoo branches this year, the company plans to diversity distribution channels by entering the online market and door-to-door sales.
The company will introduce its corporate social responsibility program called “Make-up Your Life Campaign” in China as well. The campaign offers beauty services to cancer patients with hair loss or changes in skin color.
The company, which visited a hospital in Shanghai in June to offer makeup services for female patients suffering from cancer, will extend the campaign in the coming years.
The company, which is already a market leader in Korea with a market share of almost 40 percent, aims to be listed within the top 10 cosmetics companies globally by 2015. The company plans to elevate its overseas sales from the current 14 percent to 29 percent.
In order to strengthen its market position globally, the company is currently focusing on three countries: China, the U.S. and France.
By Lee Ji-yoon (jylee@heraldcorp.com)
