"Offering Up to 90% Off"... Why Today's 20s and 30s Flock Here: The Emerging Beauty Powerhouse to Add 100 Stores [Why&Next]

Olive Young, Musinsa, Chicor, Bclean, and Off Beauty Expand Store Networks

Rapid Growth of Indie Brands... Select Shops Become 'Gateways to Global Expansion'

The K-beauty boom is turning the cosmetics multi-brand store market into a fierce battleground for distribution. Previously, single-brand shops like Missha, Innisfree, and The Face Shop dominated the offline scene. Now, CJ Olive Young is leading the charge, while Musinsa Beauty, Shinsegae Chicor, Hyundai Department Store's Be Clean, Offbeauty, and others are expanding their store networks to capture more market share.

According to the industry on July 24, Olive Young operates 1,367 stores nationwide as of the first half of the year, maintaining its market leadership. Challengers are also aggressively opening new locations. Shinsegae Department Store’s multi-brand cosmetics shop, Chicor, is currently running 21 stores and plans to expand to 40 by 2028. Hyundai Department Store’s eco-friendly beauty store, Be Clean, operates 7 stores nationwide and is considering further expansion. In April, Lotte Department Store launched the K-beauty platform ‘The Cast’ at its Cheongnyangni branch. Offbeauty, run by Q&V International under Daemyung Chemical, currently operates 42 stores and aims to increase that number to 100 by the end of the year. Musinsa Beauty, after opening its first store in Seongsu-dong, also plans to open additional stores in Seongsu and Hongdae within the year. Daiso, which operates roughly 1,600 stores nationwide, is also expanding its cosmetics brands and product categories.

Differentiation Strategies by Brand

Each company is taking its own approach to win the market. Olive Young is expanding into areas popular with foreign tourists and into key provincial business districts, solidifying its position as market leader. Musinsa Beauty is adopting a strategy of bringing fashion platform customers offline. In April, it opened its first permanent beauty store at the Seongsu megastore and plans to open independent stores in Seongsu and Hongdae in the second half of the year. It targets customers in their teens, twenties, and thirties, as well as foreign tourists, offering a space where visitors can try out 500 beauty brands first popularized online. Chicor appeals to foreign demand with beauty devices and makeup services. At its Myeong-dong and Hongdae locations, an average of 20 to 30 customers per day use its makeup services. In addition to Gangnam, Myeong-dong, and Hongdae, Chicor is also considering tourist hotspots such as Dongdaemun, Seongsu, and Anguk as candidates for new stores.

Be Clean is focused on eco-friendliness and nurturing indie brands. It only allows brands that use natural ingredients, are vegan, or have recyclable packaging. The number of in-store brands increased from around 70 in 2021 to about 160 today. About 70% of Be Clean customers are in their twenties or thirties, which is double the average at Hyundai Department Store’s regular cosmetics sections. In October, the store will co-host an expansion event for domestic small and medium beauty brands with the Korea Small & Medium Venture Business Distribution Center. ‘The Cast’ doubled its in-store brands from 30 to 60 within two months of opening. It uses an online-offline hybrid model, hosting influencer live streams in-store that connect directly to online purchases.

Offbeauty’s differentiation lies in price competitiveness. Positioning itself as an “urban beauty outlet” offering 20–90% discounts on branded cosmetics, it now carries about 500 different products. The brand aims to lower high distribution margins and expand its assortment of in-store brands.

Multi-brand Stores Fueled by K-beauty

The renewed focus on multi-brand stores is largely driven by K-beauty’s global success. Just a few years ago, the market outlook was so poor that GS Retail’s Lalavla and Lotte Shopping’s LOHBs exited the market. Single-brand shops and department store brands dominated, and there was little demand for comparing and purchasing multiple brands in a single location.

However, the K-beauty boom has reshaped the market landscape. As the cosmetics original development manufacturing (ODM) industry has grown, manufacturing hurdles have come down, leading to a rapid increase in indie brands focused on planning and branding. The rise of new brands gaining popularity online has made consumers more accustomed to comparing and experiencing multiple brands, rather than sticking to just one. Additionally, as the belief spreads that brands successful at Olive Young are likely to succeed abroad, multi-brand stores have cemented their role as both “test beds” for brands and “gateways” to international expansion.

According to the Ministry of Food and Drug Safety, last year domestic cosmetics production reached 17.9382 trillion won, up 2.3% from the previous year and the highest ever recorded. Production value increased from 13.5908 trillion won in 2022, to 14.5102 trillion won in 2023, to 17.5426 trillion won in 2024, and finally to 17.9382 trillion won last year, marking a third consecutive year of growth.

The market landscape is also changing. Last year, 15,342 responsible sales businesses reported cosmetics production records. Among companies with production exceeding 100 billion won, APR saw its production value jump from 102.6 billion won to 285 billion won, rising in rank from 21st to 4th. Gudai Global and Vinow also newly entered the upper ranks. As emerging K-beauty brands continue to grow in what was once a market dominated by major conglomerates, multi-brand stores are being seen as platforms not only for sales, but also for discovering and cultivating new brands.

Foreign investors have also turned their attention to K-beauty. According to business data research firm CEO Score, as of the end of last month, 9 listed cosmetics firms among the country's top 500 by market capitalization had overseas investors (including funds) holding more than 5% stakes, up from just 2 a year earlier. As expectations for the K-beauty sector's growth strengthen, there are forecasts for an active wave of new brand launches.

An industry insider commented, "In the past, entering department stores or brand shops was critical, but today whether a brand can get into a multi-brand shop defines its recognition. Especially, brands that perform well at Olive Young are attracting interest from overseas distributors and buyers, meaning competition among multi-brand shops is set to intensify further going forward."

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