South Korea continues to lead the global beauty and cosmetics industry, setting trends and driving innovation. With a strong economy and consumer-driven market, it has become a prime destination for beauty brands worldwide. This report explores key insights into the South Korean cosmetics landscape, covering market trends, regulations, and emerging opportunities.

Market Overview
The South Korean beauty market is valued at $25 billion, making it the 5th largest globally and 1st in per capita spending. On average, South Koreans spend $493 per year on beauty products, underscoring the deep-rooted cultural emphasis on skincare and self-care. The country’s cosmetics exports reached $9.35 billion in 2024, with Japan and the USA being major markets. Meanwhile, imports declined to $1.6 billion, reflecting a strong domestic production sector.

Changes in Retail and Distribution
The beauty retail landscape has undergone significant changes in recent years. Olive Young, the leading health and beauty store, dominates offline retail with over 1,354 locations, controlling 90% of the market in this segment. However, global brands like Watsons, Boots, and Sephora have struggled and exited due to high competition.

At the same time, e-commerce now accounts for half of all cosmetics sales, with platforms like Coupang, Naver Shopping, and Gmarket providing new opportunities for international brands. Convenience stores and discount retailers, such as 7-Eleven and Daiso, are also gaining traction as alternative retail spaces for beauty products.

Regulatory Landscape
South Korea enforces strict cosmetic regulations under the Ministry of Food and Drug Safety (MFDS). The country has banned over 5,686 ingredients, a number that continues to rise with monthly updates. Import regulations require detailed documentation, Good Manufacturing Practices (GMP) certification, and compliance with strict labeling standards. Functional cosmetics, such as anti-aging, whitening, and hair loss treatments, require additional efficacy testing before approval for sale.

Industry Trends in 2025
The beauty industry in South Korea is rapidly evolving, with several key trends shaping the market:

• Indie beauty brands are thriving, leveraging social media marketing to attract consumers looking for unique, high-quality products.
• Consumers are prioritizing functional skincare, including products that offer anti-aging benefits and skin whitening solutions.
• Technology is playing a growing role, with AI-driven skin analysis and personalized cosmetics gaining popularity.
• Sustainability is becoming more important, with increased demand for vegan, cruelty-free, and eco-friendly formulations.
• Ingredient transparency is key, as buyers seek out high-performance components like probiotics, peptides, and niacinamide.

Challenges and Opportunities for Foreign Brands
South Korea’s beauty market is highly competitive, dominated by domestic giants like AmorePacific and LG H&H. Gaining market entry requires overcoming regulatory hurdles and building consumer trust, which can be costly due to the need for extensive marketing and brand positioning.

However, opportunities exist for brands that offer something unique. Foreign companies can leverage e-commerce platforms to sell directly to consumers, partner with local manufacturers for localized production, and highlight premium ingredient sourcing to differentiate themselves. Engaging with the MZ generation (Millennials and Gen Z, ages 20-40) through influencer marketing and digital campaigns is also crucial for success.

The Rise of E-Commerce
E-commerce has become the fastest-growing sales channel in South Korea’s beauty industry. Unlike traditional retail, online platforms offer foreign brands the ability to reach consumers without establishing a physical presence in the country. Websites like Coupang support global sellers with localized payment options and streamlined logistics, making it easier than ever for international brands to enter the market. To succeed, companies must invest in digital marketing, influencer collaborations, and customer engagement to build credibility and drive sales.

What Next?
South Korea’s cosmetics market presents immense opportunities for both established and emerging beauty brands. While competition is fierce, companies that focus on digital strategies, product innovation, and regulatory compliance can carve out a strong presence in this lucrative sector. By adapting to South Korean consumer preferences—particularly in areas like functionality, technology, and sustainability—brands can position themselves for long-term success.