Local Korean Beauty Brands Winning in Digital over Global Brands

Korea is the most digitally connected country, with more than 80% of the population on the internet. WiFi is available everywhere you go; in shops, cafes and even right a long side you with the help of portable WiFi access cards. The result is a ripe e-commerce market where the average consumer spends an average of $1000 per year on online purchases.

Local beauty brands are capitalizing on this growth due to their home field advantage. Transactions were up 14% year-over-year at the end of the second quarter because of higher visibility and greater content investment. Local brands also streamline the purchase process, making it easier for consumers to purchase online through direct-to-consumer or links from major local retailers. A second reason Korean brands have been succeeding is their experimentation with local social media platforms. For example, KakaoTalk has 32 million users while only 13 million users are on Facebook. Brands use these more popular platforms to broadcast coupons and contests and have been seeing success. Finally, local brands have invested in taking the consumer through the purchase funnel faster through user reviews and promotions.

The success in Korean beauty brand strategies clearly exhibits the advantage of understanding the local marketing. It is important to advertise where the consumer is virtually. Creating connections with major retailers in the area can also boost sales and ease the purchasing process. Also, having an understanding of a local market's buying habits allows brands to better serve the consumer and meet their needs. In order for global brands to enter and succeed in any local market, they need to create strategies that are specific to that market and rethink the way they advertise.

Source: http://www.l2thinktank.com/winners-and-losers-korea-beauty/2014/blog