Marketing strategies among major domestic beauty corporations are clearly diverging. Emerging players APR Co. and d'Alba Global are spending around 20% of sales on advertising and expanding rapidly, while long-established Amorepacific Co. and LG H&H are maintaining a relatively conservative spending stance. Indie brands that are growing rapidly online are building awareness through aggressive marketing and are hot on the heels of the "traditional big two" corporations.
According to the Financial Supervisory Service's electronic disclosure system on the 23rd, APR Co. spent 166.7 billion won on advertising and promotion in the first to third quarters of this year. That is up about 66.2% from a year earlier. During the same period, sales more than doubled from 478.5 billion won to 979.7 billion won. With sales growth outpacing the increase in ad spending, the ratio of ad spend to sales fell from 21% in the first to third quarters of last year to 17% in the first to third quarters of this year.
d'Alba Global is in a similar situation. In the first to third quarters of this year, d'Alba Global spent 80.1 billion won on advertising and promotion, up 65.5% from a year earlier. Over the same period, sales increased about 68.2% from 213.7 billion won to 359.5 billion won. The ratio of ad spend to sales edged down from 22.6% last year to 22.3% this year, but the strategy of spending about one-fifth of sales on advertising is being maintained.
In contrast, Amorepacific Co. and LG H&H, which have relatively long operating histories, are continuing a relatively conservative marketing investment stance. In the first to third quarters of this year, Amorepacific Co.'s advertising and promotion expenses were 404.6 billion won, down 1.4% from the same period a year earlier (410.4 billion won. While sales grew 10.6% over the same period from 2.7934 trillion won to 3.0894 trillion won, the scale of ad spending was actually reduced. The ratio of ad spend to sales fell from 14.7% last year to 13.1% this year.
LG H&H also spent 348.5 billion won on advertising and promotion in the first to third quarters of this year, down 0.5% from a year earlier. During the same period, sales were 4.8827 trillion won, down 6.1% year over year. The share of advertising and promotion in sales was tallied at 6.7% in the first to third quarters of last year and 7.1% in the first to third quarters of this year. Because LG H&H operates other businesses such as household goods and beverages in addition to cosmetics, its ad spend ratio is interpreted to be lower than that of competing beauty companies.
Analysts say this divergence in marketing strategies reflects the recent structure of the beauty market. Amorepacific Co. and LG H&H, which have stabilized their brand portfolios, are focusing on risk management and expense efficiency. In contrast, emerging corporations such as APR Co. and d'Alba Global, which are relative latecomers, are prioritizing rapidly boosting awareness and demand through aggressive digital marketing on global online channels such as Amazon and TikTok.
In particular, Amazon and TikTok have structures in which ad spending immediately leads to top search exposure, more reviews, and higher sales. As a result, the advertising dollars spent are translating into tangible sales growth.
Emerging beauty companies have also been active recently in offline marketing. APR Co., ahead of the year-end shopping season such as Black Friday and Christmas, recently opened a pop-up store (temporary store) in New York, and ran ad campaigns in Times Square and the subway. d'Alba Global also operated pop-up stores in Los Angeles and New York.
A beauty industry official said, "Indie brands with relatively short operating histories are choosing a strategy of aggressively pouring money into advertising to quickly raise market attention," and added, "Especially on TikTok and Amazon, because advertising connects directly to immediate sales, they are actively leveraging this structure to rapidly expand their market share and awareness."