Korean beauty companies are expanding their presence in the Russian market, with export figures surpassing US$48 million last year.
According to a report released by the Korea Trade-Investment Promotion Agency (Kotra), this was more than double the US$18.5 million exported to Russia in 2012.
The uplift was led by makeup and skin care products with a 69 percent increase in sales. They accounted for 56 percent of beauty exports last year. Russia’s beauty market is worth US$9.1 billion, accounting for 2 percent of the global beauty market.
Global research firm Euromonitor projected Russia’s beauty industry will continue to grow until 2020 with annual growth rates between 1 to 3 percent. The market also depends heavily on imports and is the 8th largest cosmetics importer in the world.
Research by Kotra’s Russia office revealed that the main consumers of K-beauty products were young women aged between 25 and 34 years who were exposed to online media and e-commerce. They also tend to be in the lower income bracket.
The Hallyu (Korean pop culture) wave was a major factor that fueled curiosity in K-beauty among this demographic group. Local brands like Missha, Tony Moly and Nature Republic soon gained popularity online through personal blogs and YouTube.
Korean brands started entering the market by establishing local branches or exporting products to brick-and-mortar and online retail channels.
For Korean companies that wish to enter Russia, Kotra advised that research is crucial, as the consumption pattern of Russian beauty consumers differs by region and demographic.
For example, in regions closer to Korea local brands have been opening brick-and-mortar stores since 2012, but in Siberia e-commerce is more popular. In terms of administration, local beauty exporters are obliged to obtain a Certificate of State Registration and Declaration of Conformity for every product.