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Convenience stores bolster cosmetics ranges

Beauty products may give shops an edge in competitive market
Nov 11,2017
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CU and Etude House collaborated on Etude Mini Care, a range of 11 miniature products. [BGF RETAIL]
Until recently, competition among convenience stores was all about the food. That changed this year, however, as the industry started to branch out in an unexpected direction - cosmetics.

Although only a small source of revenue, convenience stores have long sold beauty products - mainly miniature versions of skin care products that mainly catered to consumers with immediate and unexpected needs.

This year, convenience stores are taking much bolder steps into the industry, even going so far as to seek out collaboration opportunities with major cosmetics brands.

Industry leader CU released a series of products in collaboration with cosmetics giant AmorePacific’s Etude House brand on Thursday, placing them in roughly 500 branches near universities and office districts.

For the collaboration, Etude House produced miniature versions of 11 of its bestselling skin and body care products. They will be displayed in their own section - in a box painted with the brand’s signature color, pink.

CU made a similar attempt last month with another cosmetics brand, Holika Holika, selling seven products including color cosmetics like eye shadow kits and cushion foundation. Although the lineup was placed in a limited number of branches close to universities and middle and high schools, the sales impact was significant: CU’s monthly revenue in the beauty sector rose 64.9 percent in a month.

Earlier this year, rival GS25 collaborated with Beyond, a beauty brand under LG Household and Health Care. The two worked together to develop miniature skin care kits and launched eight products at GS25 stores in April.

This prompted the convenience store’s entire revenue from skin care products during this year’s third quarter to rise 154.9 percent year on year.

In March, 7-Eleven started selling color cosmetics from 0720, a beauty brand from local manufacturer BCL targeted at young students. The lineup included lip tint and face powder.

“Our merchandiser first came up with the idea after seeing students purchase low-quality cosmetics from unknown brands sold at stationery stores,” said a 7-Eleven spokesman. “The idea was to supply better quality and cheap cosmetics at convenience stores - a channel that students frequent the most.”

Compared to March, when 0720 was first placed at around 30 7-Eleven stores, sales in the beauty sector have risen 82.2 percent this month.

One may wonder why convenience stores are making a move into the already competitive cosmetics market when they have a stable revenue source from food.

The main reason is because competition among convenience stores, especially regarding food, is already fierce. Industry sources say that expanding into cosmetics can be seen as an effort to strengthen the non-food sectors that remain relatively undeveloped.

“Shoppers at convenience stores in the past weren’t interested in anything other than food,” said a 7-Eleven spokesman. “We see that trend changing as more consumers increasingly shop at convenience stores in general.”


BY SONG KYOUNG-SON[song.kyoungson@joongang.co.kr]