'Oera' Cosmetics by Jeong Ji-seon Infusing Fashion DNA to Launch on the 26th

‘Oera’ is a high-performance skincare brand
with its flagship product ‘Calibrator’ priced around 350,000 KRW

[Asia Economy Reporter Lim Hye-seon] Chung Ji-sun, Chairman of Hyundai Department Store Group (photo), has thrown down the gauntlet in the premium cosmetics market. While Hyundai Department Store Group has previously imported and distributed overseas cosmetics domestically, this is the first time they have created their own cosmetics brand.

Chairman Chung Ji-sun's Plan for Future Growth

According to the distribution industry on the 10th, Hyundai Department Store Group's fashion affiliate Handsome will launch its first cosmetics brand, ‘Oera (oera)’, on the 26th. ‘Oera’ is a high-functional skincare brand. It uses ingredients sourced from the pristine region of Switzerland to enhance the efficacy and safety of the cosmetics. Product prices range from 200,000 to 500,000 KRW. The flagship product, ‘Calibrator’, is priced at around 350,000 KRW, targeting the ultra-premium market. ‘Oera’ will initially be available at Hyundai Department Store’s main branch, Trade Center branch, and Yeouido branch. Sales channels will later expand to online and duty-free shops.

Hyundai Department Store Group has devoted years of effort to entering the cosmetics market. Designating ‘beauty’, including cosmetics, as a core future growth engine, last year they acquired Handsome Life & (Clingen Cosmeceutical), a specialized functional cosmetics company, and Hyundai Bioland (SK Bioland), a cosmetics ingredient company. Clingen Cosmeceutical possesses know-how in developing high-functional cosmetics effective for whitening, wrinkles, and elasticity. SK Bioland is the leading domestic supplier of natural cosmetics ingredients.

Connecting Fashion DNA to Cosmetics

Hyundai Department Store Group started its cosmetics business through Handsome, not the department store. This was to infuse the ‘high-quality DNA’ cultivated over a long period with fashion brands like ‘Time’ into the cosmetics business. Since its founding in 1987, Handsome has walked a ‘fashion-only path’ for 34 years, strengthening its premium image.

Fashion and cosmetics businesses share similar core competitive factors such as the ability to develop trend-leading products and production know-how. Handsome stated that after establishing the skincare brand in the market, it will expand its product range to include color cosmetics and perfumes. There is also a judgment that growth is limited by fashion alone. The group expects to diversify Handsome’s concentrated business structure and secure new growth engines.

Targeting 2 Trillion KRW Sales for Handsome by 2030

From a distribution company’s perspective, cosmetics are an attractive growth engine. Compared to other product categories, they have high margins and can quickly establish themselves in the market by utilizing existing distribution channels. Shinsegae International, which entered the cosmetics market early, saw its sales rise from around 1.1 trillion KRW in 2017 to about 1.3 trillion KRW in 2020. Cosmetics sales were 62.7 billion KRW in 2017, 221.9 billion KRW in 2018, and 320 billion KRW in 2020. The cosmetics division accounts for 90% of total operating profit. On the other hand, Handsome’s sales have been stagnant over the past four years. From 2017 to 2019, Handsome’s sales remained at around 1.2 trillion KRW. Last year, sales dropped to around 1.1 trillion KRW due to the impact of COVID-19.

Handsome plans to start with premium cosmetics and, in the mid-to-long term, also pursue entry into the lifestyle sector handling design accessories. The group has set a goal to raise Handsome’s sales to 2 trillion KRW by 2030.

This content was produced with the assistance of AI translation services.