As a result, sales of so-called “K-beauty” products, including Korean cosmetics, surged 37% in the US market alone. K-beauty products are gaining popularity through social networking services (SNS) such as the Chinese video platform “TikTok,” especially among the MZ generation (born in the 1980s and early 2000s).
CNBC reported on the 27th (local time) that “K-Beauty Korean cosmetics, which were once mainly used by people obsessed with beauty, have fully entered the mainstream of the US market,” and “word of mouth through TikTok, young and diverse shoppers, and aggressive expansion strategies from retailers such as Fence, Sephora, Walmart, and Costco played a major role.” In fact, according to market research firm Nielsen IQ quoted by CNBC, K-beauty sales in the US this year are expected to increase 37% from last year to exceed 2 billion dollars (about 2.9 trillion won). Considering that the overall cosmetics market growth rate in the US is only in single digits this year, it has achieved unrivaled results. Korea's cosmetics exports to the US surpassed France, which had always been the number one, and even took the lead since last year.
According to Nielsen IQ, among K-beauty products, basic cosmetics are still the largest source of sales in the US market, and hair care products are the fastest growing. Also, fusion products containing color or sunscreen continue to grow. Therese & Damme, vice president of the beauty business division of Nielsen IQ, said, “The growth is at a very remarkable level,” and “K-Beauty is definitely moving to a different level compared to the overall US beauty market growth rate remaining in single digits.”
CNBC quoted a report from Personal Care Insight, a global beauty media, and explained that about three-quarters of K-beauty consumers are in the MZ generation. At the same time, they pointed out that they mainly discovered K-beauty products by watching influencers' experiences and promotional videos on TikTok. In the 2010s, when K-beauty products were introduced to the US market, they were mainly limited to niche markets such as small retail stores and Amazon online sellers, but the recent “second wave” had a different scale and speed. It was determined that the product line also covered various fields, from color cosmetics to hair and scalp care, perfumes, and skin care devices. US President Donald Trump's tariffs of 15 to 25% were imposed this year, but efforts not to pass this on to consumer prices were also assessed as having played a part.
CNBC stated, “K-pop groups such as BTS and BLACKPINK have increased in popularity in the US over the past 10 years, and the Netflix anime 'K-POP Demon Hunters' has raised the popularity of Korean culture to an unprecedented level this year,” and “K-beauty has particularly revealed the popularity of Korean culture, which has exploded in all aspects.”
As K-beauty products sell like a blaze, competition among major distribution companies in the US is also becoming fierce. In the case of fence, a cosmetics retailer with 1,400 stores in the US, only sales of Korean products surged 38% in the first quarter of this year. Ulta's management explained, “The collaboration with K-Beauty contributed to the results that surpassed the expectations of Wall Street in New York in the second quarter.” In July, Hyeok also launched 'K Beauty World', an editing platform specialized in introducing Korean brands.
Another cosmetics retailer, Sephora filled one wall of its experience store in Times Square in Manhattan, New York, with products made in Korea, such as skincare. We have also signed exclusive supply agreements with several K-beauty brands. Large supermarkets such as Walmart and Costco also increased their product range of essences, serums, and mask packs on their shelves as demand for Korean cosmetics increased. CNBC also reported that South Korea's Olive Young will open its first US store in Los Angeles (LA) next year.
