Top Companies Report

12. AmorePacific

August 6, 2012

South Korea
www.amorepacific.com

Sales: $2.3 billion

Key Personnel: Kyung-bae Suh, president and chief executive officer; Young-so Kwon, marketing; Sang-bae Shim, supply chain management; Min-jeon Lee, cosmetics counseling; Dong-hyun Bae, planning and finance; Yoon Lee, human resources and support service; Hak-hee Kang, R&D Center; Min-cheol Suh, cosmetics retail; Jae-chun Yoo, China regional headquarters; Bong-hwan Kim, international; Chan-hoe Kim, mass cosmetics and sulloc; Kwang-yong Koh, strategic management.

Major Products: Cosmetics—Amorepacific, Hera, Sulwhasoo, Lirikos, Verite, Laneige, Iope, Mamonde, TeenClear, Primera, InnisFree, Lolita Lempicka, Odyssey, Etude, Espoir. Personal Care—Mise-en-Scene, Ryoe, Happy Bath, Dantrol, Median, Songyeum; Health Care (including tea, beauty foods/supplements and drugs).

New Products: Happy Bath line extensions.

Comments: Sales rose 12.4% last year. Luxury product sales were strong (up 11.4%) due to good results in department stores and duty-free shops. Sales rose more than 10% in door-to-door sales, although the company noted that sales slowed in the second half of 2011.

According to AmorePacific, sales rose more than 15% within its Aritaum store channel (1,300 stores in Korea) and the online and home shopping sales channel, driven by customer communication via social media and increased marketing activities. Premium brands such as Laneige and Iope posted good gains.

Mass market sales (which include the Sulloc tea business) surged 18%, driven by AmorePacific’s top hair care brands, Ryoe and Mise-en-Scene, which expanded its line of functional products to cater to more customized individual needs. In addition, the company’s top cleansing line, Happy Bath, expanded its market share with the addition of a body cleansing line as well as moisturizing products.

Korea accounts for more than 80% of company sales, but the company has operations throughout Asia, France and the US. Last year, international sales rose 30% to more than $350 million. China accounted for 46% of international sales last year. This year, AmorePacific is expanding its duty-free business in Hong Kong and Singapore, and is entering Indonesia, Malaysia and Vietnam.

Meanwhile, AmorePacific’s R&D program is for the beans—literally. The company created a beauty bean garden (2,803 meters square) in Paju City to identify beans that would make good candidates for beauty ingredients.

According to its Vision 2015, AmorePacific’s goal is to become a “global total care provider of beauty and health.” The company’s strategy is to grow into one of the world’s top 10 cosmetics companies by developing 10 megabrands. Company executives say that they will build a foundation for sustainable growth by continuously searching for new growth drivers. Based on its core competency in Asian beauty, AmorePacific is developing products that satisfy the demands of the global market. At the same time, company executives insist they are determined to make AmorePacific of the most respected beauty companies that represents social contribution, environmental responsibility and positive stakeholder engagement.


 

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