[THE INVESTOR] Korean skin care brand Dr. Jart+, best known for its hot-selling BB cream, is planning to add 10 new outlets in China this year, dismissing any serious impact from the current THAAD row in its burgeoning Chinese growth.
“Our plan is to open 10 additional stores in China by end of this year. We are focusing on large cities in the country, where our trendy target customers can visit and explore the brand,” John Kim, global business chief of Have&Be, the parent company of Dr. Jart+, told The Investor on May 17.
A Dr. Jart+ outlet in Hangzhou
Dr. Jart+ made its China debut in 2013 by introducing its skin care products via beauty retailer Sephora. Now the products are available at more than 200 Sephora outlets across China as well as Alibaba-owned e-commerce site Tmall.
The 12-year-old brand aims to further expand its presence in the fast-growing beauty market, setting up its own brand shops there. Following the first opening in Shanghai last year, two more stores opened in Hangzhou and Xuzhou this year.
The planned expansion comes amid the ongoing diplomatic tensions between Seoul and Beijing that have led to sluggish sales of Korea-made goods, especially consumer goods like beauty products, in the all-important Chinese market.
Kim said Dr. Jart+’s overall global sales have seen little impact from the THAAD dispute as its business portfolio is not solely focused on China like some Korean beauty companies but is more diversified to other regions like US, and Europe.
“We have also focused marketing efforts for the brand to be recognized as a global brand rather than stressing on its Korean origins,” he added.
Dr. Jart+ is now available in 32 countries at over 4,000 beauty outlets, including the US, UK, Japan, Germany and most recently five Middle Eastern countries. It plans to tap into the Latin American market soon by entering Mexico sometime in the second half of this year through Sephora chain stores.
Dr. Jart+’s fast overseas diversification was made possible by its partnership with US-based cosmetics giant Estee Lauder Companies.
In 2015, Estee Lauder invested an undisclosed sum to take over a 33.3 percent stake in Have&Be -- which also operates male-focused cosmetic brand Do The Right Thing. The rest is held by Have & Be founder, CEO Lee Jin-wook.
The deal, however, did not result in management change nor shift in the brand strategy, according to Kim.
“Estee Lauder has provided Dr. Jart+ with its business know-how and experience it had built up for a long time,” he said.
“They have also shared their extensive global network with us. We are a good partner. We plan to maintain the positive relationship going forward.”
Kim hinted there are other foreign investors interested in investing in Have&Be, but nothing has been discussed yet. “We are always open for new growth opportunities for our business.”
Dr. Jart+, which enjoyed a meteoric rise on the back of its signature BB cream, has set its 2017 revenue target at over 300 billion won (US$266.47 million), up from 237 billion won last year.
It hopes to achieve the goal by expanding overseas sales.
“Our overseas markets accounts for about 30 percent of total revenue,” said Kim. “We hope they will to exceed domestic sales in three to five years.”
By Ahn Sung-mi (firstname.lastname@example.org)