Will there be an alternative market for China? Korean cosmetics boom in Vietnam
Vietnam’s share of Korea’s total cosmetics exports rose from 3.8% last year to 5.6% this year as of May.
Looking at the annual share of exports to Vietnam in cosmetics exports, it is steadily rising, such as 1.7% in 2016, 2.7% in 2018, 3.5% in 2020, and 4.7% in 2022.
Vietnam has already surpassed Thailand in 2018 to emerge as the number one export market for Korean cosmetics in Southeast Asia.
Considering the current growth rate, there are observations that this year or next year, it will surpass Hong Kong and become Korea’s 4th largest cosmetics export market.
The status of Korean cosmetics in the Vietnamese beauty market is unrivaled.
According to statistics from the US Department of Commerce, South Korea’s share of the imported cosmetics market in Vietnam last year was 30%, far ahead of the European Union (23%), Japan (17%), Thailand (13%), and the United States (10%).
Considering that about 90% of cosmetics consumed in Vietnam are imported, the share is not small.
In a recent report looking at the Vietnamese cosmetics market, Statista, a global market research institute, said that Korean beauty brands are most popular in Vietnam worldwide and that they have “established themselves as a leader in the Vietnamese market.” did.
It is an analysis that Korean cosmetics, which have built a sophisticated image thanks to the popularity of the Korean wave, which is the strongest among Southeast Asian countries, are quickly digging into the younger generation.
In fact, according to the results of the ‘2022 Overseas Korean Wave Actual Condition Survey’ conducted by the Korea International Cultural Exchange Agency for men and women aged 15 to 59 in Vietnam, 91.2% of the respondents answered that they had purchased Korean cosmetics in the past year. 68.8% of respondents say they buy frequently.
Vietnam’s beauty market is attracting attention because of its composition, which is one of the youngest in the world with a population of close to 100 million. In Vietnam, half of the population is under the age of 30. The median age (the age of the person in the middle when the total population is sorted by age) is 32.5 years old, more than 10 years younger than Korea (45 years old). As such, the growth potential of the cosmetics market is high.
Based on solid economic growth, it is emerging as an attractive market with the fastest growing middle-class population in Southeast Asia and adding purchasing power.
Statista also pays attention to the growth potential of the Vietnamese market, predicting that the local beauty and cosmetics market will expand from $1.5 billion (approximately KRW 1.968 trillion) in 2012 to $2.7 billion (approximately KRW 3.5424 trillion) in 2024. forecasted
An official in the cosmetics industry said, “It is still difficult to compare Korea or China in terms of the size of the cosmetics market, but considering the world’s highest growth rate, it must be a market that needs to be carefully looked at.” This is enough,” he pointed out.
(Source : Yonhap News)
