K-beauty e-tailers take omnichannel route to scale up
South Korean beauty products, popularly known as K-beauty products, are seeing a strong uptake globally. According to a Market Data Forecast report, the K-beauty market worldwide, valued at over $10 billion, is expected to grow to over $20 billion by 2026. The report suggests that the Asia Pacific region makes up about 70% of the total K-beauty market share. In India, K-beauty e-tailers Korikart and Limese are now building an offline presence for stronger consumer connect.
Korikart, operating in India since 2018, opened its first standalone store in DLF Galleria Market, Gurugram, in March this year. This launch is part of the company’s omnichannel strategy to retail Korean products across the beauty and wellness categories. “We are planning to launch five flagship stores, of 400 sq ft each, in Jaipur, Mumbai, Chennai and Bengaluru by next year,” says Seo Youngdoo, CEO and founder, Korikart. The company is targeting consumers in the 10-40 age group.
Korikart offers around 100 beauty and skincare brands — including Plan 36.5, Pep Plus, Artois, Accoje, It’s Skin, and Missha — and the price ranges from less than Rs 100 to Rs 4,000. The company’s best-performing beauty products in India are vitamin shower filters, face sheet masks, bubble masks, and body scrubs. Korikart plans to foray into hair and colour cosmetics category within six months.
India is a key market for Korikart — 95% of its global sales comes from here. The company claims to have witnessed 300% growth in sales since March 2020, and is currently reporting over 40-50% month-on-month growth. At present, 90% of its sales in India comes from online. “Keeping the pandemic in mind, I would say online will be our mainstay for the next five years, and we will work towards expanding the offline business as well,” Youngdoo adds.
After operating as an online-only direct-to-consumer (D2C) and distribution platform for close to four years, Limese has just unveiled its first brick-and-mortar store in Greater Kailash, New Delhi. In the next twelve months, the company aims to tap the top five cities, as well as the North East region. Currently, it retails K-beauty brands such as Klairs, CosRx, and Some By Mi Bye Bye.
“The primary reason for opening an offline store is to interact more closely with customers and understand their skincare goals, which might differ region-wise. For our offline approach to work, we will need to open stores across cultural hubs covering the major cities,” says Deugcheon (Dale) Han, founder, Limese.
Building an offline presence is critical to create visibility, says Nihal Mahesh Jham, lead analyst, Edelweiss Capital. “It’s important that these brands build a network of offline stores in the top eight cities in the country to create recognition,” he adds.
Given the nature of K-beauty products, brands could create a bigger impact using a mix of online and offline channels. “Most of the Korean beauty products are about the concept — ingredients used to create the product, usage and layered application — and, therefore, these products require assisted selling. The omnichannel approach will work for a lot of these concept products,” says Ankur Pahwa, partner at EY.
To garner footfall and build recall, analysts say malls are a better bet than independent stores for K-beauty brands. Besides, tying up with influencers and celebrities to build trust, especially in tier II and III markets, would be beneficial for these brands.
Pahwa says online will continue to be the dominant sales channel for these brands. “The offline mode will enable more product discovery, brand discovery, experience building, and product education, rather than become a sales channel really,” adds Pahwa.