Why is the Korean makeup that famous brands have stopped selling in China for many years not fragrant?

　　The well-known Korean brand Heyan stops selling the brands under its group in China and shrinks the offline market

　　Why is the Korean makeup that has been popular for many years not fragrant?

　　On March 1, the well-known Korean brand Heyan (HERA) WeChat mall officially stopped selling products.

Not long ago, the brand has basically withdrawn from the domestic offline market.

The Beijing Youth Daily reporter noticed that not only Heyan, but also many brands under the Korean beauty group Amore Pacific Group are shrinking the offline market.

What made the Korean makeup that has been popular for many years suddenly not fragrant?

　　stop selling

　　Following the basic withdrawal of counters

　　He Yan stopped selling on WeChat mall yesterday

　　"Dear Yanfan, due to channel adjustment, Heyan WeChat Mall will stop sales today (March 1)..." This is a statement on the homepage of the Heyan WeChat Mall applet, which means that it started yesterday (March 1). , Heyan has one less sales channel in China.

　　Speaking of Heyan, many female consumers may not be able to remember what brand it is. If you talk about the popular Korean drama "My Love from the Stars" in 2013, most people may still have an impression.

Most of the products used by Qian Songyi, starring Jun Zhixian in the play, are the brand's products, but they were transliterated as "Hera" at that time.

With the popularity of the show, the brand also successfully became a top-tier Korean makeup brand at the time.

Since the brand was not introduced to China at that time, many beauty-loving women sought out purchasing agents, and did not hesitate to buy the same style of Qian Songyi at an increased price, and the lipstick has since then had the color number "Star You Color".

　　Founded in 1995, HERA is a high-end beauty brand under the Korean cosmetics giant Amorepacific Group, covering a full range of skin care products and make-up series.

In July 2016, HERA Heyan officially entered the Chinese market with the popularity of Korean style. The first offline counter was opened in one of the best shopping malls in Beijing - SKP.

Afterwards, Heyan successively opened counters in high-end shopping malls such as Shanghai Jiuguang Department Store, Nanjing Deji, and Hangzhou Hubin Intime.

However, 4 years after opening her first store in China, He Yeon began to retreat quietly.

From March 2020, Zhengzhou Dennis Department Store Heyan counter will start a clearance sale, with a 50% discount across the board.

Cities such as Tianjin and Chongqing followed closely.

In October of the same year, the counters of Shanghai Raffles City were cleared and closed.

At present, Heyan's domestic offline counters have basically withdrawn.

Not only that, but online channels are also shrinking.

On December 31, 2021, He Yan's JD.com and Vipshop online channels have been closed.

On March 1 this year, its WeChat mall also stopped selling and will be closed at the end of this month.

Although the official flagship store on the Tmall platform is still open for business, a reporter from Beiqing Daily noticed that the store currently has 1.02 million fans, and the largest selling product in the store, Black Gold Concealer, has a monthly sales volume of 500+. The number of reviews is 4000+, and there are only 5 products with monthly sales exceeding 100 in the store, and only 1687 people have watched the latest live broadcast.

　　Data shows that in recent years, HERA’s offline revenue has been declining.

In 2021, Amorepacific’s financial report shows that in the fourth quarter, the group’s net loss was 73.1 billion won.

For the whole year of 2021, HERA's offline store revenue will decline by 29.4%.

　　Phenomenon

　　in the Chinese market

　　Korean makeup is really bad

　　In fact, for Amorepacific Group, it is not only Heyan that is holding back the brand, but more deadly, Innisfree, which has the most stores in China.

　　A reporter from Beiqing Daily visited a number of Innisfree offline stores and found that compared with a few years ago, some of the stores that are still still have shrunk significantly, and shopping guides have reduced staff.

Not only that, some stores located in community malls often have less customers than cake shops and jewelry stores on the same floor.

And the shadow of Innisfree can no longer be found in shopping malls in some popular business districts.

The reporter inquired about the public comment and found that there are currently less than 20 Innisfree in Beijing.

　　In 2012, Innisfree, which is positioned in the mid-end market, was introduced to the Chinese market by Amorepacific Group.

　　With the support of the "Korean Wave" at that time and its high cost performance, from 2012 to 2014, Innisfree opened a total of 100 stores.

After entering 2014, it continued to run at the speed of opening 100 new stores every year, and it also sank to the second and third tier cities.

　　In 2015, Innisfree's annual sales in the Chinese market reached 1 billion yuan, and both sales performance and operating profit showed a trend of rapid growth.

After the success of Innisfree, Amorepacific Group introduced Etude House, whose target customers are girls.

　　After 2017, although Amorepacific Group has cut prices for 327 beauty products including Innisfree, Etude House, etc., it still failed to salvage the declining trend of total revenue and net profit. .

Subsequently, Etude House completely closed all offline stores in the Chinese market in March 2021.

　　According to reports, Innisfree once had more than 800 stores, but now there are only 140, and more than 80% of the stores have been closed, and there is even news that the brand will withdraw from the domestic market.

Subsequently, a person in charge of Amorepacific Group said that the group is optimizing the channels for the Innisfree brand, and such store adjustments will continue in 2022.

The person in charge also said that Amorepacific Group will make a new round of strategic adjustments for the Chinese market, but only optimize and reduce Innisfree stores, not involving other brands.

But apparently, Hye Yeon's withdrawal made the above "promise" in vain.

　　Not only that, Korean cosmetics such as NATUREREPUBLIC and Skin Food have been reducing offline stores in recent years.

　　The main reason for the reduction of offline channels for Korean beauty makeup is naturally because of the sluggish revenue.

Huaxi Securities pointed out in its research report that Korean cosmetics brands first took the express train of the development of the cultural industry, vigorously promoted the brand with the help of film and television works, integrated traditional cultural elements, and enhanced brand identity. However, the history of the overseas expansion period shows that cultural empowerment only It can help short-term overtaking in corners, and long-term reputation depends on product quality and technological content.

　　the truth

　　The promotion of old users and the rise of domestic products

　　Time is running out for Innisfree

　　With the ebb of the domestic "Korean Wave" and the rise of new retail models, the marketing model of Korean cosmetics seems to be unable to keep up with the pace of the Chinese market.

　　Taking Innisfree as an example, its sales have halved from 642 billion won (approximately RMB 3.43 billion) in 2017 to 348.6 billion won (approximately RMB 1.86 billion) in 2020, and its operating profit has also increased from 1,079 won in 2017. 100 million won (approximately RMB 577 million) was significantly reduced to 7 billion won (approximately RMB 37 million) in 2020, a decrease of 93.6%.

　　On the one hand, as the main consumer group of Korean cosmetics, the post-80s and post-90s consumers who are most affected by the Korean Wave have grown up and entered a period of using more high-end skin care and beauty products.

Statista data shows that China has become the second largest global cosmetics market after the United States.

In 2020, the monthly transaction volume reached 34.1 million yuan, and the market share of high-end products was around 26%.

　　On the other hand, many new-generation consumers have grown up with domestic beauty and skin care brands. In terms of cost-effective products, these more sentimental domestic brands have also squeezed the market of Korean cosmetics with the same positioning.

　　According to the data of the China Business Industry Research Institute, the share of domestic brands in the Top 20 cosmetics category has increased the most.

In 2020, Perfect Diary ranked second with a share of 6.4%, and surpassed international brands such as Dior, L'Oreal, YSL, Armani, etc. in one fell swoop; and domestic brands such as Huaxizi, Zhiyouquan, and Zise have also improved significantly.

　　During the "Double 11" period in 2021, the first-hour turnover of domestic beauty brands such as Mao Geping, Ou Shiman, Winona, Meinuo, and Xiangyi Materia Medica exceeded last year's "Double 11" full-day sales.

Among the top 10 beauty brands with a year-on-year growth rate in the "Double 11" turnover, 80% are domestic beauty brands, and there are 5 domestic beauty brands with a year-on-year growth rate of over 100 times.

　　For the Innisfree, there is not much time left for them.

Because they are facing domestic beauty brands with capital blessing.

According to incomplete statistics, in 2021, there will be 132 financings in China's beauty industry, with a total financing of 15 billion yuan.

　　Text / reporter Zhang Xin

　　Photo courtesy of this edition/Visual China