Retailers race to open beauty-focused stores

South Korean retailers outside the traditional cosmetics industry, from fashion platform MUSINSA to Hyundai Home Shopping and Daiso, are accelerating the rollout of beauty-focused stores.

Demand for physical beauty stores is increasing as the popularity of K-beauty expands the market and a surge in foreign tourists boosts cosmetics purchases. Retailers are using customer data and loyal shoppers from their core businesses to target fashion consumers, middle-aged women and value-conscious buyers.

According to beauty industry sources on Monday, MUSINSA opened its first standalone beauty store, MUSINSA Beauty Hongdae, in Seoul this month. It plans to add two more locations in Seongsu, Seoul, and Jeju by the end of the year.

The Hongdae store generated 250 million won ($182,000) in cumulative sales within three days of opening. The roughly 1,320-square-meter location carries about 12,000 products from more than 870 brands. A similarly sized Seongsu store is expected to open in November.

MUSINSA expands pharmacy-linked beauty concept

MUSINSA’s beauty expansion is supported by demand from its existing fashion customers. About 83 percent of customers who made their first beauty purchase on MUSINSA between January and August were already members of the platform.

“We plan to strengthen our pharmacy-linked ‘pharmacy beauty’ concept at future offline beauty stores,” a MUSINSA official said.

Hyundai Home Shopping is also expanding Coasis, its own curated beauty retail chain. After sales at existing locations exceeded targets by more than 50 percent, the company opened its largest Coasis store yet at Hyundai Department Store’s Mokdong branch in Seoul this month.

The opening brought the number of Coasis stores to five since Hyundai Home Shopping launched the home-shopping industry’s first proprietary curated beauty store in December last year.

Coasis primarily targets women in their 30s through 60s. Unlike conventional beauty stores that attract a large share of consumers in their teens through 30s, Coasis carries a higher proportion of functional skin care products addressing concerns such as dark spots, wrinkles and loss of firmness.

“Our experience accumulated over more than 20 years of beauty programming on home-shopping channels enables us to offer competitive prices,” a Hyundai Home Shopping official said.

Coasis plans to expand the number of exclusive products jointly developed with partners such as Cosmax from 40 to 60 by the end of the year. The company is also considering additional stores in major commercial districts.

ABLY strengthens private-label beauty brands

Daiso opened its first beauty-focused store near Konkuk University Station in Seoul last month, marking the retailer’s first standalone location dedicated to a specific product category.

The roughly 66-square-meter store focuses on value-priced beauty products costing 5,000 won or less. Beauty items account for 80 percent of its merchandise, while inventories of popular products that frequently sell out at conventional Daiso stores have been increased.

Industry observers expect Daiso to open additional beauty-focused locations.

Daiso’s cosmetics sales surged 144 percent in 2024 and rose another 70 percent last year. Sales increased 30 percent from a year earlier during the first eight months of this year. As of August, Daiso carried about 2,200 beauty products from roughly 150 brands.

Fashion platform ABLY is also expanding its private-label beauty business. After entering the skin care market in April with its first beauty brand, BYBLY, it broadened its lineup with the color cosmetics range Be Collection.

ABLY plans to open its first physical store by the end of the year, where it is expected to offer private-label products from BYBLY and Be Collection.