1、JULY 2021Authored by:Authored by:Harshita MadanRumana Rahman(Korea Plus)Collaboration with:Collaboration with:Aakriti Jain AnejaRajat Yadav(Retail Team)Design:Design:Sanya DattBrand CommunicationsSOUTH KOREA & INDIA SERIESBeauty is Not Just Skin DeepForewordI would like to express my hearty complime

2、nts to Invest India for launching a series of investor reports and publishing its first report on the beauty and cosmetics, delineating its promise and potential. With this report, the long-felt need for an authoritative and informative account of the rapidly expanding frontiers of beauty and cosmet

3、ic segment in both Korea and India has been met. I am sure, this report will facilitate Korea-India collaboration and help realize the immense potential of bilateral cooperation in this emerging sector.The pivotal role of Invest India in facilitating foreign investment into India under the competent

4、 and energetic leadership of its Managing Director and CEO, Mr. Deepak Bagla, has been well acknowledged. Korean investment to India has been witnessing remarkable strides with the setting up of a dedicated investment promotion cell - Korea Plus - under Invest India, at the intervention of Prime Min

5、ister Narendra Modi, who visualized a great future for Korean investment in India. In just five years, Korea Plus has been able to promote and facilitate Korean investment into India, even under the challenging circumstances of Covid-19 pandemic. Bilateral economic ties constitute the fulcrum around

6、 which Korea-India cooperation revolves. The political leaders and businessmen of both Korea and India understand the importance of economic cooperation in deepening bilateral relations and they continue to make sincere efforts to tap the huge untapped potential for trade and investment cooperation.

7、 Today, Korea and India hold their own attractions for each other. The importance of Korea to India lies in Koreas strength to contribute to Indias economic development. Prime Minister Narendra Modi looks at Korea as the role model for Indias economic transformation. Korea, as one of the worlds fore

8、most manufacturing heavyweights and home to major global corporations, is an ideal partner for India to realize its vision to emerge as the next major global manufacturing hub. Similarly, India holds its importance for Korea as the next economic frontier. This complementary strength has contributed

9、to a turnaround in Korea-India trade and investment ties in recent years. As far as Koreas investment in India is concerned, it is driven mostly by large corporations. The most recent and successful Korean investment in India has been by Kia India in Anantapur, Andhra Pradesh, to set up a state-of-t

10、he-art car manufacturing plant. Korean SMEs are equally keen to enter the Indian market, but they face challenges and difficulties. The investment environment needs to be improved to make it easier for the SMEs to do business in India. To this end, India needs to take further steps to improve the ba

11、sic physical infrastructure and fundamental living conditions. These will help attract more Korean investment, both by conglomerates and SMEs, into India. The potential of economic cooperation is enormous in beauty and cosmetics sector, which can further strengthen Korea-India economic ties. Korean

12、beauty products enjoy huge popularity in China and Southeast Asia. These products are slowly winning consumers confidence, particularly, in the Northeast region and major cities of India. With Indias burgeoning middle-class population having increased personal disposable income in hands, which is in

13、creasingly becoming conscious of beauty and skin care, I see a huge opportunity for K- beauty products to consolidate their position as leading brands in the Indian market. Koreas beauty industry, in line with the Make in India policy, can use India as a manufacturing hub, to make beauty and skin ca

14、re products not just for Indians but for the whole world. It is just a matter of time before K-beauty finds a way into Indian hearts much in the same way as other Korean brands have done so previously. For such a promising future, there is a constant need to make available relevant, reliable and up-

15、to-date information about the sector to the potential businessmen and women from both Korea and India. In this direction, the role of Invest India is fairly cut out.SOUTH KOREA & INDIA SERIES: BEAUTY IS NOT JUST SKIN DEEPShin BongkilAmbassador Republic of Korea to IndiaForewordRelations between the

16、Republic of Korea and India have grown significantly in recent years to become truly multi-sectoral. The two countries are spurred by shared interests and mutual goodwill that are often at display in our widespread exchanges. At present, the Republic is the fifth-largest source of investment in Indi

17、a, both a source and product of our special strategic partnership.Invest Indias Korea Plus Desk is a bilateral initiative between the Republic of India and the Republic of Korea to promote, facilitate and retain Korean investments in India. Envisaged as the first reference point for Korean Investors

18、 in India, the team provides comprehensive end-to-end facilitation for the Korean business community in India.In a new endeavour, the Korea Plus team is launching a series of detailed investor reports on Indias collaboration with the Korean Republic. The reports will highlight investment opportuniti

19、es in India across popular yet emerging sectors. This first report, on beauty and cosmetics, provides an overview of both the Korean and Indian markets in this segment. In showcasing the tremendous potential of this sector in India, the report also underscores the global popularity of Korean beauty

20、products and opportunities for their retail, manufacturing, and sourcing in India.This increasing popularity of beauty and personal care products in India is an outcome of greater internet penetration and the transformation in Indias retail sector. Not only do Indias urban, semi-urban and rural popu

21、lations now have better access to consumer products, but they also have more knowledge of the latest consumer trends. Rising household incomes and increasing consumer spending are now also likely to enhance Indias position from the fourth largest retail market in the world to the third largest by 20

22、25. Therefore, Indias retail sector and its various segments are among the most dynamic and profitable destinations for global investors.Given the Korean Republics pre-eminence in this segment, there is scope for greater and more widespread collaboration between our two countries. There is also a la

23、rge stage for Korean retail businesses in Indias expanding workforce, vibrant startup ecosystem, and innovation culture. I hope that this reports in-depth presentation of the two countries retail sectors and Indian investment opportunities therein are helpful to you, global investors. I also hope th

24、e presentation of Indias strong market factors and its viability as an investment destination brings you to the countrys shores to participate in the building of New India.SOUTH KOREA & INDIA SERIES: BEAUTY IS NOT JUST SKIN DEEPDeepak BaglaManaging Director and CEO,Invest IndiaIntroduction to the K

25、Wave: Koreas Soft Power Korean Wave, or Hallyu, literally meaning the “flow of Korea” depicts the rise in popularity of South Korean culture since late 1990s. South Korean culture is constituted through different elementssongs, movies, television, food, and distinctive fashion. Together, they form a

26、 wave of cultural exports that the foreign ministry in Seoul has been promoting to the rest of the world since 1999. According to the Korean Foundation for International Cultural Exchange, these cultural exports helped the Korean economy earn USD 9.4 Bn in 2018, 9% more than what it made the previou

27、s year. The report added that Hallyu has also contributed to USD 5 Bn of exports in consumer products, such as cosmetics, automobiles,and tourism products. It has been witnessed that overall culture and consumption is influenced by popular actors and singers endorsing the products. As Korean media b

28、ecame popular overseas, so did the products they endorse. This in turn raised awareness about Korea and the local culture.The influence from Hallyu can be described as “soft power”, allowing companies to draw customers to their products by marketing Korean culture in addition to offering explicit be

29、nefits, such as convenient packaging, price promotions or product innovation.SOUTH KOREA & INDIA SERIES: BEAUTY IS NOT JUST SKIN DEEP01KOREANBEAUTY MARKET03SOUTH KOREA & INDIA SERIES: BEAUTY IS NOT JUST SKIN DEEPIn Korea, Skincare is SelfcareIn South Korea, skincare is a part of the culture. There,

30、women as well as some men start to take care of their skin since a young age. In Korea, there is a long list of ingredients and products that are essential to a beauty regime. These products put emphasis on skin aesthetics such as luminous textured skin, youth, and hydration. Hence, beauty for Korea

31、ns is an expectation for those looking to seek professional and social status.Korean Cosmetics: Homemade to Made In KoreaBakgabun which translates to Parks powder, was the first mass-produced cosmetic beauty item in South Korea. This face powder was a bestseller from 1916 to 1930, however, as it had

32、 lead content,soon sales collapsed, and many such new cosmetic products were introduced inthe market. From 1910, during the Japanese rule, Japanese brands dominated the Korean cosmetics industry preventing an indigenous industry from developing during this period. After Koreas independence in 1945,

33、the country was embroiled in the Korean War which disrupted the economy. The beauty industry only started flourishing around 1961 when a law was passed banning cosmetics from other countries.The Beginning Into the New WorldAmong countries, France and Japan were considered the leaders of cosmetics in

34、dustry for many years. Recently, however, South Korea has joined their ranks, after becoming famous for its beauty products and bringing its own innovation to the market. K-beauty products are now sought after around the world and are available in most markets.The K-wave is characterised by the spre

35、ad of K-Drama, K-Pop, and K-Beauty across the world, in which the term K-Beauty is used to describe beauty products from South Korea. The Korean Cosmetics Industry today ranks 8th in market share of the global cosmetics industry. K- Beauty emphasises on skin health and having products that are uniqu

36、e as well as accessible. The success of K-beauty products around the world has been so explosive that now Western and Global brands are following the trends setin South Korea. The popularity of the Korean products has led to South Korea now becoming the top manufacturing hub for beauty products. Eve

37、n Western brands are formulating their products with Korean R&D chemists and outsourcing to contract manufacturing plants. By 2024, the Korean beauty industry is expected to reach close toUSD 200 Bn making it one-quarter of the worlds total beauty market.Expansion and GrowthVenom and slime may seem

38、like gimmicks, but these unique features and techniques have pulled the industry to new heights and globally, these cosmetic companies rank amongst the top beauty companies in the world. SOUTH KOREA & INDIA SERIES: BEAUTY IS NOT JUST SKIN DEEP04The K factor: Bees, Snails, Tiger (Grass) IngredientsKo

39、rean beauty standards focus on moisture in the skin, resulting in preference for creams over powders and a pursuance for a glow from within. The ingredients used to manufacture these cosmetics are almost entirely natural and several ingredients are of typical oriental culture, which are hard to find

40、 in western beauty products. Hence, products in this segment are manufactured using unique ingredients such as snail slime, bee venom, starfish extract, pig collagen, etc. which are uncommon in the beauty industry in the rest of the world. The K-beauty products market is driven by the consumers attr

41、action to these unique one-of-a-kind ingredients. InnovationKorean beauty in known for its innovative products and routines to get the healthiest and brightest skin. Research, innovation, and technological advancement has been the driving force behind the rapid development and expansion of the K-bea

42、uty products market. Through R&D, K-beauty giants have been able to translate the rich traditions of natural Asian ingredients into innovative products. Koreas skincare industry is regarded to be 7 years ahead of its international rivals in terms of innovation.Example: The proliferation of sheet mas

43、ks globally is an example of the viral success of Korean innovation. Hence, due to convenience of use and low cost, the sheet masks have a large share in the K-beauty market. Some other products that South Korea has introduced, that are widely popular in the world are, bb creams, cc creams, cushion

44、foundations, fermented skincare, essences, and sleeping masks. The Korean WayThe strength of Korean beauty products lies in their composition with very Beauty for MenThe Korean cosmetics industry is the largest market for mens cosmetics in the world and has attracted mens attention with skin care co

45、smetics and all-in-one products. Today, men are increasingly becoming image conscious and hence using products, such as makeup and skincare products. K-beauty mens products offer diverse range of these products. This trend is not only spreading across Asian countries but also in thewestern countries

46、. Key Manufacturing Locations, Retail Location, and Market Share of Key Korean Cosmetics Companiesspecific products formulated for specific purposes. In Korea, the skin care rituals for women may consist of 4 to 20 steps, with different products for different skin concerns which means on an average

47、Koreans consume more products per person than average.SOUTH KOREA & INDIA SERIES: BEAUTY IS NOT JUST SKIN DEEP05OverviewK Beauty Market Share (2018)17%North America4%Lamea9%Europe70%Asia PacificK Makeup Products Market USD 1.6 Bn2018USD 3.6 Bn2026 (P)CAGR of 11% is expectedfrom 2019 to 2026SOUTH KOR

48、EA & INDIA SERIES: BEAUTY IS NOT JUST SKIN DEEP06Going Global: Export Stats The Korean beauty industry has seen a massive rise in product exports over the last 5 years. Korean beauty companies Rise in Exports ofKorean Cosmetic Products in 2018Consumption of Korean Cosmeticshave been able to break in

49、to the world market because the demand for K-beauty products was high.70%UK65%Southeast Asia47%France110%Indonesia65%Russia31%USAUSD 6 BnUSAUSD 26 BnChinaUSD 14 BnHong KongSOUTH KOREA & INDIA SERIES: BEAUTY IS NOT JUST SKIN DEEP07Koreans love Korean brandsOf the top cosmetics companies in Korea, 7 a

50、re homegrown CompanyPopular BrandsAdwin Korea Corporation Its factories are situated in South Korea. Global partners of Adwin includes Walgreens, Rite Aid, Target, Forever 21, SASA,A.S. Watson Group, Missha, Mediheal, Holika Holika, Cosnova, PZ Cussons, and Janvan DerLeek. Amorepacific Group A beaut

51、y and cosmetics conglomerate, operating over 30 beauty, personal care, and health brands It is the worlds 12th largest cosmetics company.BH Cosmetics, LLCIts sales network is spread over various countries such as China, Taiwan, Myanmar, Malaysia, Vietnam, Japan, Russia, Mongolia, U.S., and Australia

52、LG Household & Health CareIt is a consumer goods company that operates in cosmetics, household goods,and beverages business.Able C&C Co., Ltd Korean multinational company based in Seoul Established in 2001 Annual Revenue: USD 321 Mn (2018)SOUTH KOREA & INDIA SERIES: BEAUTY IS NOT JUST SKIN DEEP08Com

53、panyPopular BrandsSouth Korea has large contract manufacturers that formulate for numerous Korean and International brandsManufacturerManufactures forCosrx Inc. Founded in 2013 HQ in Seongnam, South Korea Available at Olive Young, Watsons, ULTA, Boots,Douglas, and moreCarver Korea Co Ltd Acquired by

54、 Unilever in 2017 HQ in Seoul, South Korea Founded in 1999COSVISIONMostly for brands under Amorepacific group like Professional cosmeticsmanufacturer as OEM/ODM Founded in Daejeon Metropolitan City in 2006 Acquired by Amorepacific Group in 2011COSON Has manufacturing facilities in Osan, Gyeonggido,

55、Korea They co-found a company Code Cosme with entertainment company YG and launched MOONSHOT in 2014. The brand then became fully owned by YG They established a factory in China They also launched their own brands such as MIZON and ATO 1004 Recently they produced stem cell-based items with Kangstem

56、Biotech through a new brand GD11For global brands, COSON produces products for33% of their whole business is from Amorepacific, 18% from Etude House, 5% from Innisfree, and 2% from eSpoir.They produce for other brands likehowever, the sum of other brands business is only about 2-3%. SOUTH KOREA & IN

57、DIA SERIES: BEAUTY IS NOT JUST SKIN DEEP09ManufacturerManufactures forCOSMECCAKorea Co. Ltd. 3rd largest cosmetics manufacturer in Korea. Recently bought a 34.71%stake in a New Jersey based skin care manufacturer Englewood Lab forUSD 53.7 MnCOSMAX One of the biggest cosmetics manufacturers (OEM/ODM)

58、 in Korea It runs 4 different factories in Korea: 1 for skin care products, 1 for Lip & Mascara, 1 for Powder, and the last one for sheet masks They run research organizations called Research & Innovation teams in Korea, China, USA, and Indonesia. They have over 300 researchers in-house and those re

59、searchers develop products for over 600 brands In 2004, COSMAX established manufacturing facilities in China and in USA, Indonesia, and AustraliaInternational brands:Kolmar Korea Korean cosmetics ODM business began with them in 1990 One of the biggest ODM companies in Korea Runs 9 different labs for

60、 cosmetics research and development: skin care lab, makeup lab, personal care lab, skin science lab, Beijing lab, global technology center, fragrance lab, and package design lab.INDIANBEAUTY & PERSONAL CAREMARKETINDIANBEAUTY & PERSONAL CAREMARKET11SOUTH KOREA & INDIA SERIES: BEAUTY IS NOT JUST SKIN

61、DEEPIn India the practice of beautifying ones self goes back to the Indus Valley Civilisation. Archeologists have found evidence of not only women but also men preparing cosmetic mixtures to enhance their appearances such as the presence of toilet jars and bronze oval mirrors.Over the centuries as n

62、ew civilisations developed and society advanced beauty trends became more home-based and a lot of cosmetics started relying on kitchen staples like turmeric, gram flour, coconut oil, neem which were easily available for everyone. The most famous example of homegrown cosmetics being Kohl (Kajal) as s

63、oot/carbon vapors of lamps used to be collected to line the eyes. JRD Tata (Tata Group) in 1952 founded Indias first cosmetics brand Lakm at the As Indias GDP increases exponentially, so does Indias per capita spending on beauty and personal care. India cosmetics industry is driven by several major

64、factors such as: the high personal disposable income of people, rising awareness towards skin health, and increasing demand for herbal cosmetics.Indians and Beauty: Tale as Old as TimeGrowing Market:Unparalleled Opportunitiesbehest of then Prime Minister Jawaharlal Nehru who wanted beauty products t

65、o be manufactured within the country. The brand is now a part of the Hindustan Unilever Group. Indian beauty and personal care market is on the upward trajectory and growing steadily since the introduction of cosmetics brands into the market.12SOUTH KOREA & INDIA SERIES: BEAUTY IS NOT JUST SKIN DEEP

66、Indian Beauty & Personal Care Market CategoryEvolutionHand CareNewly emerging category; contains nail, cuticle care, and hand creamsColour CosmeticsShift in Usage-Special Occasions only to Everyday UseFace CareMovement towards integrating wellness with skincare productsHair CareEvolved western style

67、 hair care regime being preferredBody CareNon-Traditional products growing- Body wash, Sunscreen, Derma, etc.Body CareFace CareColor CosmeticsHair CareHand Care055402014USD Bn20162021(P)13SOUTH KOREA & INDIA SERIES: BEAUTY IS NOT JUST SKIN DEEPIndian Beauty & Personal Care Market GrowthMa

68、rket SizeGeneric CategoriesSpecialised CategoriesCAGR%6.62.210.9514.582022 (P)20182012USD Bn10%12%15%11%9%7.5%8.515.922.5Key Categories in Beauty and Personal Care Market in IndiaGeneric CategoriesBath & ShowerOral CareHair CareOthersSpecialised CategoriesMensGroomingMake UpCosmeticsFragranceSkin Ca

69、re14SOUTH KOREA & INDIA SERIES: BEAUTY IS NOT JUST SKIN DEEPDomestic demand in India is one of the fastest growing across all world markets, while the estimated retail sale of cosmetics & other personal care products is growing Consumption of Korean Cosmetics in 2018in the range of 15-20% annually.

70、Over the past 5 years total overall demand has grown by 60%.Cosmetics Market Size in India (Value)(USD Bn)CAGR of 12.08% is expected during (P)20520Skincare Products Market Size in India (Value)(USD Bn)2021 (P)201752.502468Value of Cosmetics Market in IndiaValue of Skincare

71、Products Market in IndiaUSD 10 Bn2019USD 19 Bn2025 (P)CAGR of 12% isexpected during2020-2025USD 2.5 Bn2017USD 5 Bn2021 (P)15SOUTH KOREA & INDIA SERIES: BEAUTY IS NOT JUST SKIN DEEPThere are several trends responsible for the shifting beauty choices of the Indian consumers.Trends We Love to See Incre

72、ased adoption of mens grooming products. Increasing use of beauty devices and technology infused products and services. Consumers opting for at-home services, online buying. Interest and willingness to trade-up, increased use, bigger collection of products. Growing importance of peerfeedback and pro

73、duct reviews in purchase decisions#TrendingAlthough Indians have always trended towards natural skincare products, these were generally kitchen ingredients and not formulated cosmetics. However, now there is a high adoption rate for herbal products due to people going for herbal formulated products

74、leading to a growth in this segment of 15%.With influencers taking over, and beauty care making its way back to old practices there has been a surge in the demand for natural, chemical-free products. Few beauty brands have also started incorporating traditional ingredients such as Indian herbs like

75、Ashwagandha, turmeric etc. in new ranges of beauty products. Home-grown brands such as Forest Essentials, Kama Ayurveda, MamaEarth, Vilvah, Teal & Terra, Sacred Salts, Plum, and the Secret Ingredient cater to a niche but growing audience, comprising mostly the skin-conscious, organic-loving, environ

76、mentally aware consumers.Natural and OrganicOverall, the market is moving towards premiumization, with premium segment growing at 6.3%, as compared to 1.1% for mass market. Indian brands (both regional and national) have a sizeable presence in the mass category, while premium markets are largely dom

77、inated by the international brands.Generic to PremiumImported cosmetics have had a major impact on the Indian market. Indian consumers tend to look towards international brands as lifestyle enhancement products.16SOUTH KOREA & INDIA SERIES: BEAUTY IS NOT JUST SKIN DEEPIn early 2010s, when the digita

78、l boom was peaking in India, the countrys ecommerce players set out to win over the women, not for their decision-making role as homemakers or as primary carers of children, but to provide products for their self-care. From Amazon and the Walmart-acquired Flipkart to the more recent Limeroad (founde

79、d in 2012), the focus shifted has shifted to the women demographic. The rise of cosmetics as a retail category was therefore a natural progression, which saw the birth of online beauty retailer Nykaa.E-Retailers- The New Way in How Global Brands Took Over theIndian Vanity Many international brands l

80、ike Revlon (the first international cosmetics brand to enter India in the mid-nineties), Maybelline New York, Christian Dior, Estee Lauder, MAC, LOreal, The Body Shop, and Bobbi Brown have been present in India for an extensive period. The Company That Paved the Way Entered India in 1994. They marke

81、t a total of 15 brands and use all the available distribution channels: a. Mass market (LOral Paris, Garnier, Maybelline New-York and NYX Professional Make up);b. Hair and beauty salons (LOral Professionnel, Matrix, Krastase, Cheryls Cosmeceuticals and Decleor); and c. Selective distribution (Kiehls

82、, Yves Saint Laurent, Giorgio Armani, Ralph Lauren, Diesel and Guy Laroche). They have two manufacturing facilities in Chakan (Maharashtra) and Baddi (Himachal Pradesh), which cater to 90% of Indias requirements, two Research and Innovation facilities, and India headquarters in Mumbai The R&I facili

83、ties comprise a Product Development Center in Mumbai and an Advanced Research Center in Bangalore. Together, they represent one of LOrals six global R&I hubs.The top three players in the Indian market are international players:The other prominent international players with a strong presence in the I

84、ndian market include Gillette India, Johnson & Johnson (India), Reckitt Benckiser (India) and Procter & Gamble Home Products.17SOUTH KOREA & INDIA SERIES: BEAUTY IS NOT JUST SKIN DEEPFollowing in the way paved by Nykaa, many ecommerce players have branched out over the years to include cosmetics and

85、 beauty products as an essential part of their product offering. Fashion e-tailer Myntra in 2018 announced its plans to go into the brick-and-mortar retailing of beauty products under-Myntra Beauty. Amazon India too has shown interest in this sector, with plans of its own beauty and personal care la

86、bel to comeout in the future.A Primer in Online Beauty It was launched in 2012 with a focus on creating an inventory- and content-led platform. Almost eight years on, the company has not only established a market presence with 61 physical stores, following an omni-channel model, but also recovered f

87、rom the losses to report a profit of INR 2.3 Cr in FY19. Nykaas valuation in 2020 is USD 1.2 Bn after raising USD 13 Mn from Steadview Capital in 2020 and is now categorised as a unicorn.KOREAN BRANDS IN INDIA19SOUTH KOREA & INDIA SERIES: BEAUTY IS NOT JUST SKIN DEEPWe see ecommerce websites and mal

88、ls flooded with Korean beauty products and Indians cannot have enough of the sheet masks, serums, and cc creams and the trend seems to have just started to grow. In 2018, Indias K-beauty imports rose 72% to $9.5 Mnand seems to be just the beginning.Reasons why India cant get enough of K-Beauty: Cust

89、omers here are slowly shifting to natural products which are chemical free The Indian beauty market, unlike the K beauty market, is moving from makeup to skin care base. Additionally, Indian beauty market is not saturated yet. In the past 3-4 years, the boom of social media has enabled the spread of

90、 awareness of Korean products through fashion/ beauty influencers and bloggersAnnyeong to IndiaKorean songs, movies, and fashion styles are followed closely by many young people in the seven north-eastern states. The region has been loyal fans of K-Pop ever since the Hallyu wave struck. Mizoram, Nag

91、aland, and Manipur were the first states in the country to warm up to K-skincare. Sites like Beauty Barn and Coral Beauty (Nagaland) and Daisy Skin Fix and FirstSkin (both Mizoram) were the first in making Korean brands accessible to Indians.Slowly, as the popularity started to grow in other parts o

92、f the country, multiple small-scale importers mushroomed in the country- Whatsapp and Facebook groups served as popular channels for sale.The Initiation: North East India Riding the K-WaveIn 2013, Innisfree (Amorepacific Group) opened its flagship store in Delhis Khan Market. The success not only le

93、d to multiple stores being opened across India, but we also see more and more Korean beauty brands entering and tasting success in Indias burgeoning beauty market.The Integration: Korean Brands Formally Enter2015: The Face Shop entered the Indian market 2019: Launched in India when Nykaa started off

94、ering its products to Indian customers 2013: Launched flagship store in Delhi 2020: 23 stores across 7 cities Online retailing through Nykaa, flipkart, myntra and purple2018: Launched in India with partnership with Nykaa2019: Launched in India with partnership with Nykaa2020: Launched in India with

95、partnership with Nykaa20SOUTH KOREA & INDIA SERIES: BEAUTY IS NOT JUST SKIN DEEPThanks to the growth of the luxury segment overall as well as the high demand of K- Beauty in India, we saw the potential of the market for Sulwhasoo.In recent years, Nykaa has been a frontrunner the Korean beauty conver

96、sation in India, focusing on educating Indian customers on the novelty of the products and ingredients. Since starting association with Korean brands in 2017, Nykaa, in 2019, has 20 K-brands, including Desembre and site-exclusives like Laneige and Dearpacker. Nykaa also has a dedicated team for the

97、K beauty segment.Started as an e-store on Instagram, the demand led the founder in starting an e-commerce website in 2017, today the platform host 25+ K-beauty brands including Jumiso, Elizavecca, Im From and By Wishtrend (both brands by the founders of dear Klairs), Heimish, Missha, and Neogen.Spre

98、ading the Wings Through Ecommerce Founded by Dale Han, Limese is a licenced distributor and ecommerce portal for selling products from 10+ Korean brands in India. Limese was also funded by Kakao ventures in 2018.Doyoul Kai Lee,Innisfree India1We have been observing the growing trend of Korean beauty

99、 brands across the world. These brands have been a huge success with the Indian consumers as well with their innovative ingredients and cutting-edge science. With Laneiges signature water science-based products we offer our customers a new facet in their beauty care regime. Falguni Nayar,CEO of Nyka

100、aIn November 2017, a fashion editor told me India wasnt ready for the Klairs Freshly Juiced Vitamin Drop (a high-concentrate Vitamin C serum). But we sold 10,000 units in 2018.21SOUTH KOREA & INDIA SERIES: BEAUTY IS NOT JUST SKIN DEEPStarted in 2019, Maccaron currently has 10+ K-Beauty brands and al

101、so offers its users an opportunity to try new products through My Maccaron Box which contains an assortment of latest K-beauty products customized to skin type or product concept. The company has teams both in Seoul and in Gurugram.E-Cosmetics Market in India2011InitiationPhaseInitial GrowthPhaseCAG

102、R 97%Stable GrowthPhaseStable GrowthPhase201420172020(P)2022(P)USD 0.03 BnUSD 0.3 BnUSD 1.5 BnUSD 3.3 BnCAGR 70%CAGR 50%Dale Han,Co-Founder, Limese22SOUTH KOREA & INDIA SERIES: BEAUTY IS NOT JUST SKIN DEEPQ. What led your interest to introduce Korean Beauty to India? My own struggles with some skin

103、concerns and pursuit for better skin gravitated me towards Korean skincare, and the rest is history.Korean beauty focuses on holistic interaction of products and what they bring to the table independently. With my initiation into Korean skincare, I learned to understand what my skin needed and how t

104、o care for it by following a disciplined skincare routine. The impressive results piqued my interest in Korean beauty and skincare, and thus inspired me to bring Korean Beauty to India, with the aim to inculcate skincare know-how in our consumers across India.Q. Would you like to describe briefly th

105、e journey of Beauty Barn so far? Well, it has been an exciting journey so far. We love what we do, and we enjoy interacting with our customers about their skin grievances, guiding them on skincare and curating the best products for them. Despite the ups and downs along the way, it has been a worthwh

106、ile journey so far. Q. How do you think the consumers have reacted to Korean beauty products, have you seen any major trends developing? Over the last three years, we have seen a steady rise of clientele from across the country, spanning across different age-groups, including men. With Korean beauty

107、 products and skincare solutions flooding the internet, our consumers have now become more skin conscious and well-informed about their skin issues and the corrective actions required. So, if you look at it, thats quite a positive trend coming from our consumers. Q. What do you think is the future o

108、utlook for Korean Beauty products in India? It is no secret that the Korean skincare industry is the leading and the most innovative industry in the world. They have set the bar really high and in doing so have fundamentally revolutionized the beauty industry. Having said that, our Indian consumers

109、are also becoming more aware and responsive towards this growing k-beauty trend. So, you can expect the K-beauty industry to grow much bigger in the years to come.Ms. Toima Kinimi, Founder and CEO, Beauty BarnInterview withOPPORTUNITIES FOR K BEAUTY BRANDS IN INDIA24SOUTH KOREA & INDIA SERIES: BEAUT

110、Y IS NOT JUST SKIN DEEPSeeing the success of Korean Beauty brands in India, we are witnessing exponential increase in userbase and awareness of Korean products. The market is prime for Korean brands to spread their presence in India in a more substantial manner and explore the promising opportunitie

111、s offered in the space of retailing, sourcing and manufacturing. India is Asias 3rd largest retail market & the worlds 4th largest after US, China and Japan India to become the 3rd largest consumer market by 2025 Overall retail in India is projected to reach USD 1.1-1.3 Tr by 2025RetailIndia is one

112、of the fastest-growing economies in the world. It will remain one of the youngest nations on the planet and will be home to more than 1 Bn internet users. The new Indian consumer will be richer and more willing to spend, and unlike her predecessors, she will have very specific preferences.Demand: Ri

113、se in Consumers in Tier 1 and 2 Cities E-commerce market expected to reach USD 200 Bn by 2027 56 Mn jobs across segment by 2022 will be generated (National Skill Development Corporation) 650+ Malls & 100+ high streetsDemand: Rise in Consumers in Tier 1 and 2 Cities Indian Householdsin 2030Consumer S

114、pendingin 203080%Middle IncomeWill Drive75%Middle IncomeIndia: The Land of Opportunities25SOUTH KOREA & INDIA SERIES: BEAUTY IS NOT JUST SKIN DEEPEmerging Retail HubsJalandharChandigarhDehradunDelhiJaipurJodhpurKotaGwalior LucknowMeerutAgraAmritsarLudhianaKanpurAllahabadVaranasiRanchiJamshedpurRaipu

115、rNagpurAurangabadWarangalHyderabadVijayawadaVisakhapatnamBengaluruChennaiCoimbatoreTiruchirappalliMaduraiThiruvananthapuramKochiKozhikodeMysoreHubli-DharwadNashikAhmedabadRajkotSuratIndoreBhopalJabalpurVadodaraMumbaiPuneBhubaneswarDhanbadKolkataPatnaGuwahatiEstablished metrosAdditional emerging mark

116、ets (30)Fresh metros (2)Next set of high-potential cities (10)Source: Invest India*Map not to scale26SOUTH KOREA & INDIA SERIES: BEAUTY IS NOT JUST SKIN DEEPMultiple global players are already manufacturing in India through theirown factories and through contract manufacturers. There are many privat

117、e label skin care manufacturers that focuson skin care and beauty, showing robust manufacturing acumen. Global beauty brands have not only set up offices inIndia, but also R&D centers that focus on developing products that cater to the South Asian market. India also exports essential oils, fragrance

118、 oils, and base preparations of cosmetics across the globe.Manufacturing In 2015, German personal care company, Beiersdorf AGs Nivea commissioned its first facility in India at Sanand (Gujrat). At this site they manufacture the emulsion products such as body care, bath care, mens care, face care, an

119、d lip care at India also provides ready access to various contract manufacturing for global brands that may not wish to or are unable to manufacture within the country. With the Indian personal care contract manufacturing industry expected to grow from USD 400 Mn in 2016 to USD 663 Mn by 2025, India

120、 is on the path to develop as a global contract manufacturing hub. Contract ManufacturingBeauty Market: Retail Sales Channels 7%Pharma and Drug Stores18%Department Stores4%Beauty Salons44%Supermarket/Hypermarket4%Online Sales Channels23%Speciality Storesthe facility. The production facility includes

121、 a Research and Development centre for product development and innovation in packaging.Modi-Mundipharma Beauty Products Pvt Ltd. (formerly known as Modi-Revlon), part of Umesh Modi Group, introduced Revlon in India in 1995. it is the first international cosmetics brand launched in India.SOUTH KOREA

122、& INDIA SERIES: BEAUTY IS NOT JUST SKIN DEEP27Key PlayersName of CompanyProductsVVF Ltd.,MumbaiOne of the largest contract manufacturer of personal care products in the worldWorlds largest contract manufacturer of bar soapsClarion Cosmetics,ChennaiLargest cosmetics manufacturer in India Products inc

123、lude: Shower Gel, Body Lotion, Shampoo, Hair Cream, Conditioner, Facewash, Handwash, Cold cream, Petroleum JellyAG Industries,DelhiProducts include: acne face wash, facial moisturizer, lip gloss, sun protection cream, skin moisturizer, organic body lotion, facial creamJT Cosmetics and Chemicals,Vado

124、daraProducts include: hair relaxer cream, hair oil, hair cream,hair styling gel, shampoos and conditioners, various types of face and body creams, aromatherapy oil, talcum powder, petroleum jelly etc.Cosmetica Science,Changodar-GujaratProducts include: de-tan, anti-ageing, scrub, face mask, face was

125、h, gel, treatment facial kits, shampoos, serum, hair oil, hair spa, Liposoluble wax, sugar wax, depilatory wax productsOther players: Sarvotham care Ltd. (Hyderabad), Zoic Pharmaceuticals (Punjab), Vanity case Hindustan foods limited (Goa), Vasa Cosmetics (Mumbai), Bo international (Delhi), Zymo cos

126、metics, etc. Sourcing Apart from the myriad opportunities for Beauty players in the retail and manufacturing segment, India also presents countless opportunities to be the global sourcing hub for cosmetics companies. The great Himalayas, lush forests, and the deep blue seas are home to a wide number

127、 of natural ingredients which are becoming increasingly popular globally for their skin benefits.SOUTH KOREA & INDIA SERIES: BEAUTY IS NOT JUST SKIN DEEP28Raw MaterialBenefitCoconutKnown for its moisturizing properties as well as antimicrobial propertiesHemp Seed OilIts a natural humectant preservin

128、g the upper layer of theskins moisture.MarigoldIts bio-active and antioxidant properties have been shown to promote collagen synthesis and cell tissue regeneration in the innermost part of our skin. Its effective against UV-induced oxidative stress and is used for treating a host of issues including

129、: inflammation / swelling, dry / sensitive skin, eczema, bruises, insect stings / bites, and fungal disorders like athletes foot.Pomegranate ExtractPolyphenols, punicalagins and punicic acid are examples of some of the powerful antioxidantsRose Hip OilIts anti-oxidant, anti-inflammatory and anti-vir

130、al properties this ingredient is widely used for treating and strengthening dry, irritated and weathered skin, burns, scars and reducing the signs of aging.TurmericIts also been used to treat a variety of skin problems like acne, wounds, burns, eczema and psoriasis and treat sun damage and skin phot

131、oaging (i.e. loss of the skins youthful appearance)Aloe VeraNeutralize the effects of ultraviolet (UV) radiation, repair your skin from existing UV damage, and help prevent fine lines and wrinkles.AshwagandhaSuperior rejuvenative ingredient is renowned for its anti-ageing and antioxidant-rich proper

132、ties. It also helps stimulate the immune system, and increases vitality, energy, endurance and stamina.Hibiscus Natural source of alpha-hydroxy acids (AHAs)Himalayan ClayA naturally occurring soft brown clay that helps cleanse, exfoliate and even out the skin toneKokum ButterEasily absorbed into the

133、 skin, kokum butter is composed of beneficial compounds that help regenerate and nourish skin cells.Organic Apricot OilApricot oil nourishes, revitalises, and improves skin elasticity.SaffronAnti-bacterial and anti-inflammatory qualities. Excellent natural ingredient for reducing pigmentation, brown

134、 spots and other skin blemishes.A few examples of popular raw materials being sourced from India29SOUTH KOREA & INDIA SERIES: BEAUTY IS NOT JUST SKIN DEEPExamples of Sourcing by Global Beauty companiesSources raw materials like Sesame Seed Oil, Castor Oil, and Silica from India. These are then shipp

135、ed to Canada for production of the cosmetics.Sources Mango seed and Jasmine from India. The Body Shop launched the worlds first ever Community Trade Recycled Plastic from Bengaluru, India in 2019. The Body Shop has been buying recyclable plastic collected by waste pickers in Karnataka and introducin

136、g it into its packaging following a thorough cleaning and recycling process.THE WAY FORWARD31SOUTH KOREA & INDIA SERIES: BEAUTY IS NOT JUST SKIN DEEPIndias beauty and cosmetics markets are seeing tremendous growth over the last few years. As the chapters before show- there is immense potential for c

137、ompanies that are looking to enter this market. Not only is India an emerging market for beauty, but it can also be a gateway for enterprises to other geographical markets such as the Middle East due to Indias central location in South Asia and strong trade ties to those countries. As India looks to

138、 become a manufacturing hub, several opportunities and incentives are present for those who are willing to make the first move. It has been seen time and time again that Indian markets are lucrative business opportunities that can provide a loyal customer base to those firms that enter. Hopefully, t

139、his snapshot of India encourages more market diversity in a segment that is ripe for investment-See You Soon in India!India is the Prime Destination for the Next Global Brand32SOUTH KOREA & INDIA SERIES: BEAUTY IS NOT JUST SKIN DEEPEuromonitor Report: KPOP Kbeauty and Morehttps:/ Products Market Glo

140、bal Opportunity Analysis and Industry Forecast, 2019-2026https:/ MARKET IN INDIA 2020 WHATS NEW? August 2020, Netscribes, IncINDIA SKIN CARE PRODUCTS MARKET Opportunity Analysis and Industry Forecast, 2021-2027, Allied Market Researchhttps:/www.thebodyshop.in/community-trade-recycled-plastichttps:/c

141、hemexcil.in/cosmetics-toiletries-essential-oils-industryhttps:/www.cbi.eu/market-information/natural-ingredients-cosmeticshttps:/chemexcil.in/content/top-item-exports/411/2e0f2569c4f96932e3a35be599a703d3https:/ PlusVigyan Bhawan Annexe,Maulana Azad Road, New Delhi-110011Tel: +91 11 2304 8100 Scan toknow more