Beauty products are becoming one of Korea’s biggest exports. While they enjoy increasing popularity in the U.S., they are even trendier in China, where imports of Korean cosmetics surged more than 250% this year and now account for nearly a quarter of the country’s beauty imports.
Pop culture has helped spread their reputation – beauty products are often integrated into popular K-dramas – alongside perceptions that their quality is superior to that of domestic products. L2’s Digital IQ Index: Beauty China points to another reason that Korean Beauty brands are succeeding in China: digital competence.
While European and U.S. brands saw their Digital IQs fall this year, Korean and Japanese brands demonstrated double-digit growth. Their best-in-class approach to the China market is exemplified by Gifted brands Innisfree and Laneíge, which both joined L2’s top ten. Both brands aggressively use sampling to drive trial and awareness – Innisfree on Beauty community sites, Laneíge on mobile-based communities. In addition, Innisfree boasts a sophisticated direct-to-consumer brand site and cross-channel loyalty program, and Laneíge is the most mentioned brand on microblogging platform Sina Weibo, garnering more than 21,000 mentions per month.
In general, Korean brands have been quicker to localize their brand sites than their Western counterparts. Just a third of Western brands host their China sites in-market, compared with 77% of Japanese and Korean brands and 90% of local brands. This failure directly affects online sales: load times for sites hosted outside China are more than double those of locally hosted sites, and most Chinese consumers say they would shop elsewhere if faced with a slow-performing site.
Moreover, while Korean Beauty brands in China have traditionally had less sophisticated sites, their increasing popularity has prompted heavy investment in commerce elements. For example, 33% more Japanese and Korean brands cross-sell on product pages this year than last, while only 11% more Western brands and 22% more local brands adopted this strategy.
However, the L2 study also finds that some Korean brands could do more to capitalize on their popularity. Etude House and Innisfree are the most searched Index brands on Youku, outperforming both local and Western brands – an indication of their popularity. Yet Innisfree’s Youku channel is only the 12th most-viewed, and just 11% of the 62 videos Etude House posted in 2015 have garnered more than 5,000 views. This suggests that while the brands have a ready audience, their videos currently lack engaging content.
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