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Case # .

Cosmetic’s Marketing Strategy to Rise to the Top of the World: Sulhwasoo Case Study

Choi Yun-Jung, Dongguk UniversityCho Byung-Woo, Dongguk University Wang Hong-Jin, Dongguk University

Contents

1. Executive summary2. ‘Sulhwasoo’ and its current status3. Brand history of ‘Sulhwasoo’4. The birth of ‘Sulhwasoo’ and its domestic market advance5. Foreign market entry of ‘Sulhwasoo’ brand6. The key to success7. Marketing suggestions8. Conclusion and Lesson

2 H O W K O R E A N B R A N D S S O A R

Executive Summary – Sulwhasoo Case

Reason for selecting SulwhasooSince Sulwhasoo did combine elements of Oriental Medicine and Culture

Marketing, it was able to create a new market, which allowed the product to lead the market share.This brand differentiated distribution channel by selling products only in the

department stores, duty-free shops, and door-to-door sales. Also, it succeeded in pursuing consumers that Sulwhasoo is quality product.Unlike existing Korean brands, Sulwhasoo made a huge success both in the

USA and China which is one of the largest markets in the world.

How Sulwhasoo became world famous brand?When the national market started to face slowdown of growth in the market,

Sulwhasoo chose to grow in the international market.(2004-Hong Kong, 2010~2011-the USA, China)Competitors targeting niche markets prevented Amore from growing rapidly.

However, Amore's wide customer base and technology helped get over the situation. Amore sought solutions to overcome the economic crisis occurred in 2008.

Keys to became No.1 brand-Differentiation strategy that created a new market.-Technology-based products.-Attracted customers through culture marketing.-Kept pace with the trend in the market.Future marketing suggestions-Combination of oriental medicine and inner beauty.-Putting out cosmetics for men in China to keep up with the latest trend. -With the help of Big Data, provide individual based services.Conclusion-Make profits from overseas markets that can maximize profit in the long run.-Shift a viewpoint and benchmark a successful case of a leading overseas

company in order to grow continuously. -Use Big Data to manage and analyze information properly.

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1. Sulwhasoo and its current status

1.1. Reason to choose Sulwhasoo

①By combining oriental medicine and culture marketing, Sulwhasoo ranked 1st in domestic market. Sulwhasoo was able to create a new market in Korea with the idea of combining oriental medicine and culture marketing. This helped the company to have a no.1 market share in domestic market. We are going to find out the difficulties that Sulwhasoo faced and how they overcame these hardships.

②Door-to-door sales, premium policy improved image of corporation. Sulwhasoo sold a variety of products through door-to-door sales, the department stores, and duty-free shops which boosted image of corporation. This also made consumers feel that they are the special people. Social climate is putting an emphasis on individuality and consumers care about this too. Consumers feel satisfactory when using trendy products. Therefore, end-users purchase not only products companies sell but also satisfaction. We will now shed light on the strategy that kept pace with the new trend.

③Sulwhasoo has a huge potential Sulwhasoo first tried to break into HongKong market and made a success. After that, Sulwhasoo tapped into the biggest economic markets such as the United States and China. As did in Korea, Sulwhasoo could survive in the highly competitive markets by targeting the people of the upper class in those countries. This shows that Sulwhasoo has an enormous potential to be successful in any markets.

1.2. Stock price and present value of Amorepacific, Sulwhasoo

① Present value of AmorepacificAmorepacific is a listed company that has a product range from

Sulwhasoo to Hera, Primera, Innisfree etc. The company has international competitive power with high technology. Total amount of market price is 534,900,000kw and stock price is approximately 900,000kw. Stocks of Amorepacific are known to be profitable whenever and whoever purchase it. In particular, the company is planning on reaching 1,200,000,000,000kr in 2015 and


5,000,000,000,000 in 2020 with overseas sales. The number of employees in other countries is roughly 5,800 which exceeded the number in Korea 4,700 last year. Amorepacific started to focus on recruiting global talents and employed a large number of local employees.

②Present value of Sulwhasoo Sulwhasoo based on oriental medicine and prestigious image, it leaded the market in the cosmetics industry. Particularly, Sulwhasoo showed record-high sales in the department stores. Also, it not only captured eyes of consumers in the United States and China but also raised brand awareness in the international level. Sulwhasoo has been targeting people of the upper class and being able to sell products in large cities in China which in return brought the company a huge revenue. Even, in the United States, the renowned department store, Neiman Marcus asked if they can sell Sulwhasoo in there. Sulwhasoo was offered space in the Bergdorf Goodman department store in june, 2010. The Bergdorf Goodman department store is famous for its strict regulations about interior design, but it exceptionally acknowledged Sulwhasoo with flower patterns and allowed the product to be sold in a large volume .

1.3. What adversities it overcame to become international brand?

①Slowdown of grow in the domestic market Sulwhasoo had been growing by the end of 2002 and it saw a slowdown of growth after that. With this in mind, Sulwhasoo first tried to step into Hong Kong market hoping overseas markets would bring them a greater success. Hong Kong market attracted a lot of attention from the company because it had a huge number of travelers with the purchasing power. Another reason was that Hong Kong was not anymore under colonial control by the Britain but China. Therefore, Hong Kong market can be a stepping stone for the larger market such as China. Trying to penetrate the foreign market as a strategy to overcome the low sales did help the company to get over the situation they faced. We will discuss more in detail about this and provide ideas for a new market creation. ②Competitors' market advanceSulwhasoo used to be the sole oriental medicine based cosmetics which

dominated market without being interrupted by competitors by 2005. However, its one of the competitors, 'lgcare', made an analysis of the

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oriental medicine based cosmetics and was able to research the pros and cons of the product. After 'lgcare' starting to sell similar type of product in the market, Amorepacific lost a significant amount of market share. We will

③Financial crisis in 2008Financial crisis in 2008 had a huge impact on the cosmetics industry as

a whole. It seems that profits Amorepacific was making was on the increase between in 2008 and in 2010, the figure turned out to be slower than that of before. We will go over the precise date and find out what we can do about it.

2. Brand history of ‘Sulwhasoo’History of Sulwhasoo

1967 starting to research ‘Chinese medicine treatment with ginseng’

1972 obtain a patent on an extraction of ginseng ingredients1973 the first ginseng cosmestics ‘Jinsaengsammi’

1975 new release of ‘Sammi’ in domestic market and exports of 22 items in international market

1981 exports and overseas release of ‘Sammijin’

1987 the birth of Sulwha that integrated skin physiology into oriental medicine

1990~1996 decision on production of differentiated products as a response to the imports of foreign luxury cosmetics

1997 release of Sulwha, co-developed by Kyung Hee University Korean Medicine

2002~2004 Success in domestic market and no.1 brand power

2004making headway into the overseas market.

Sulwhasoo‘s market advance in Hong Kong and first renewal

2005

market advance of the second mover 'LG care' which

decreased sales of Amorepacific

change of company name from ‘Pacific’ to ‘AMOREPACIFIC’ and its efforts to become a global brand


2009 ‘Sulwhasoo spa', second renewal2010 Sulwhasoo's market advance in the United States2011 Sulwhasoo's market advance in China2012 Sulwhasoo's market advance in Singapore

Table 1. Brand history of Sulwhasoo

3. The birth of ‘Sulwhasoo’ and its domestic market advance

3.1. Market situation around the birth of ‘Sulwhasoo’

① A crisis Amorepacific faced due to imports of foreign cosmetics in 1990s

In the middle 1990s, as the number of imported foreign cosmetics increased, it accounted for larger and larger amount of market share in Korean market. In order for Amorepacific to get over the situation, they made a decision to produce products that have different features from foreign cosmetics, which was ‘Sulwhasoo’. For the moment, Amorepacific mainly concentrated on door-to-door sales. However, with the introduction of Sulwhasoo in the department stores, it put more of emphasis on the premium image of its product. Moreover, according to the survey, while it turned out that oriental medicine products were high in demand, the popular oriental medicine product ‘Baekoksaeng’ was not produced owing to management issues in the company. Likewise, the need for oriental medicine products by a great number of consumers expedited the new introduction of Sulwhasoo in the market.

3. 2. SWOT analysis of domestic marketStrength Weakness

- Sulwhasoo’s technology and quality- leader in domestic market- premium brand image- Differentiated culture marketing

- limited clientele

Opportunity Threats- Well-being trend, higher demand for oriental medicine products

- Increased share of imported foreign premium brands

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- Stopped production of ‘baekoksaeng’ - More competitors

Table 2. SWOT analysis of domestic market

3. 3. STP AnalysisⅠ. Clasificasion by age

Segmentation

Teens -seek products that can improve their troubled skin-prefer products with not strong stimulusThe twenties-seek for individuality, demand for products with good designThe thirties, The forties-start to think about skin aging, prefers wrinkle-care products-prefer premium brandⅡ. Classificaion by priceLow-price -students focus on price rather than quality.Middle-price-those who choose substance over appearance.High-price-those in their thirties or forties who has purchasing power-those women who hope to express their confidence

Targeting

-those who pursue well-being trend, trust oriental medicine and of good social position-middle-aged women who has a sense of financial security

Positioning

-focus on effectiveness of oriental medicine and oriental sensitivity-try to spread oriental medicine products hoping to express Korean beauty

Table 3. STP Analysis of domestic market

3. 4. Target consumersSulwhasoo brand targets those consumers who are in pursuit of Well-

being trend as well as who place full confidence in oriental medicine


products. That is, not only those who are older than 35-year-old women but also who have purchasing power at the same time. According to ‘7-year cycle’, women tend to experience a change inside and outside the body. At the age of 35, they will notice skin aging. At the age of 42, they will have gray hair and skin aging may speed up more than ever before. Sulwhasoo brand can be a solution for those women experiencing these rapid changes in their body. Therefore, Sulwhasoo tries to come up with strategies that can seek profits in the long run.

3. 5. Concept of Sulwhasoo brand : ‘Premium cosmetics’Cosmetics used to be a means for women to express themselves in a

delicate way. That is why premium image of products highly affects the number of purchases made by consumers. Sulwhasoo took this into consideration and attracted the large pool of targeted consumers.

① Brand philosophy of SulwhasooBrand philosophy of Sulwhasoo started from the proverb ‘A beautiful

face is a silent commendation’. This derived from our thoughts that looking good is as important as being a good person. The brand philosophy tried to show its national beauty to the people in the world. With effectiveness of its oriental medicine features and oriental sensitivity combined together, Sulwhasoo captured the attentions of potential consumers.

② Sulwhasoo’s exclusive design

1)Container designSulwhasoo introduced classy product designs. The design shows oriental sensitivity. Sulwhasoo expressed its confidence through the design of it. Consumers Sulwhasoo gained consumers confidence with the help of its design. The design contains distinctive curves and it even took its usages into consider

Figure 1. Sulwhasoo Container ation.2)Colors

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Including Korean traditional color ‘Traditional Five colors’, it has a variety of colors. Each color represents each product line. The color gold conveys premium brand image.

Figure 2. Sulwhasoo color

3)PatternsShape of a Japanese apricot flower is Sulwhasoo's pattern that it was inspried by shape of flower at Buddhist temple and it looks like wall a full of flowers guarded home of kingdom women. he shape of hexagon similalr turtle's back means good health and long life. It is simply embodied flower petal of 6 pieces Figure 3.

Sulwhasoo Patterns and looks like beautiful and ideal space. The shape of modernly reinterpreted Sulwhasoo give consumer premium image..

3 .6. 4P analysis of domestic marketPRODUCT PRICE

- ingredients’ differentiation· use of oriental ingredients · extract with water- design seeking Korean beauty- premium brand image

- high-price strategy-target those who has the purchasing power

PLACE PROMOTION

- sales channel : department stores, duty-free shops- 45% of profits through door-to-door sales

-premium marketing, VIP marketing- blueocean strategy-culture marketing, culture directing marketing, culduct marketing- win-win marketing, marketing with public interest- PR strategy

Table 4. 4P Analysis of domestic market


3. 7. Marketing strategy in domestic market

①High price strategy High price strategy : High price strategy turned out to be a best choice for Amorepacific because they could make a considerable profit. Moreover, high quality image of products was stamped on consumers’ memory, which allowed Amorepacific to make more profits. The design of Sulwhasoo containers was based on technologies targeting to be recognized as classy oriental medicine products. Sulwhasoo expressed its confidence with the design and built trust with consumers.

Premium marketing : Amorepacific guarantees the high quality of products produced in accordance with its concept which is ‘luxurious culture brand’ so that it set a relatively higher price for all products. Limited edition, special edition could be seen as a premium marketing strategy.

②Differentiation strategy To attain higher brand image, the company was in need of a new brand strategy. To be able to do this, Amorepacific had to come up with new marketing strategies.

Differentiation of distribution channels : Sulwhasoo differentiated distribution channels by selling Sulwhasoo products only through the department stores and door-to-door sales. As a result, Amorepacific gets to dominate the high price cosmetics market and Sulwhasoo became the main item for the company.

Blueocean strategy : In the early days of market advance, Amorepacific showed its true qualities with the design of products as well as marketing strategies. Advertisement with celebrities, distributing samples, a cut-price sale can be classified as differentiated blueocean strategies.

③Culture marketing strategyCulture marketing : Amorepacific provided a differentiated culture marketing strategy by using selected materials and advertising products with master craftsman who were designated as intangible cultural asset. Also, the company insisted distributing products only through the department stores, door-to-door sales and tax-free sales on board.

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Culture directing strategy : Products are expressive of its culture. Design of the containers shows it the most in particular that it has Korean beauty and it built up confidence by letting consumers know effectiveness of oriental medicine products.

Culduct(Culture+Product) marketing : This speaks for a certain group .

Figure 4. ‘Sulhwa’s Culture event with ten artists

④The stream of consciousness strategyCoexistence / Win-win marketing : Amorepacific supported the creation of Sulwha club run by 35 important figures and with the help of those members of the club the company promoted products with various marketing strategies.

Marketing with public interest : By allowing the public to be included in the profit-making process of the company, the company kills two birds with one stone. Sulwha Maven club let members of the club accumulate points based on their performances. Accumulated points with proceeds from the sales of products were used to support the cultural activities.


Figure 5. Maven Club Logo

⑤PR strategyPromotion targeting customers of affiliated companies : Those in their 20s and 30s who joined the Hera membership are expected to get samples hoping this might lead them to purchase Sulwhasoo products.

Price Differentiation Culture Marketing

The stream of consciousness strategy

PR strategy

High price strategy,Premium marketing

Differentiation of distribution channels,Blueocean strategy

Culture marketing strategy,Culture directing strategy,Culduct strategy

Coexistence / Win-win marketing, Marketing with public interest

Promotion targeting customers of affiliated companies

Table 5. PR strategy of Sulwhasoo

3. 8. Marketing performance and consumer reaction Sulwhasoo established high-price strategies by combining traditional Korean beauty and effectiveness of oriental medicine into products. Ceaseless product development, design research, and differentiation of the distribution channel are the steps Amorepacific took. Sulwhasoo’s marketing strategy had a huge influence on the consumers’ purchases. Sulwhasoo increased sales by considering purchasing disposition. Also, Amorepacific tried many different things such as ‘Sulhwa Maven Club’, ‘Sulhwa Club’ to raise the level of satisfaction. Among them, ‘Sulhwa Maven Club’ let members of the club accumulate points based on their performances. Accumulated points with proceeds from the sales of products were used to support the cultural activities. Sulwhasoo became number one brand power in 2002, in 2003, and in 2004. Sulwhasoo is now thought to be a good product for middle-aged women and a premium brand.

-Sulwhasoo Sales Graph (unit : one hundred million)

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Table 6. Sulwhasoo Sales Graph97-08‘ Maeil Kyungje(2009,02) / 09‘ Hankuk Kyungje(2010,06) / 10’ E-Daily(2011,02) / 11‘ Kyunghyang Shinmun(2012,10)

4. Foreign market entry of ‘Sulwhasoo’ brand

4. 1. Foreign market situation There are two fundamental reasons why Amorepacific decided to advance in foreign markets. First of all, Amorepacific faced deepening market competition in Korea. Second reason was the increased number of imported cosmetics. In the early 1990s, when Amorepacific made a decision to see the bigger market, more than 30 percent of domestic market was dominated by global cosmetics brands who had brand power and implemented aggressive marketing strategies. Added to that, labor dispute also made Amorepacific break into foreign market even quicker and it was Sulwhasoo product that they sold in international markets.

①Deepening market competition in Korea In the 1990s, cosmetics industry was not thought to be a profitable field of business. The rate of growth in the cosmetics industry was slowing down. In addition, intensifying competition in domestic market was in progress. To overcome this situation, Amorepacific needed to develop high quality brand as well as capital for marketing. Therefore, it was too risky to do more business in Korean market.

②A rapid increase of imported cosmetics

YearExport(1000,US$) Import(1000US$) Trade

deficitTotal export Cosmetics Ratio Total

import Cosmetics Ratio

1993 24,445,054 990 0% 26,192,221 67 0% -9231990 65,015,731 13,115 0.02%69,1843,678 15,800 0.02% 2,7052000172,267,510 64,010 0.04%160,481,018 331,060 0.21%267,050Table 7. The number of imports and exports

We can see from the above table that the number of imported cosmetics is on the increase and Korea records a trade deficit. In this market situation, Amorepacific had no other choices but to look around the bigger markets instead of being more involved in Korean market.

③Slower sale growth in 2003 and the start of global management in 2004


We can see from the below graph that sales have been down in 2003 compared from in 2001 and in 2002. Based on this fact we can conclude that the company needed to advance in foreign markets. Thereafter, Amorepacific left their first footprints in Hong Kong

Table 8. Sulhwasoo annual sales graph

The fall of a growth rate and making global image because of market④ expansion of LGcare

Sales Gross margin Net profit Closing Year

2,293,407,080,572 1,560,676,322,021 318,809,138,452 12.03(2011 closing)

2,058,513,891,222 1,502,572,718,596 284,481,232,361 11.03(2010 closing)

1,769,009,924,840 1,261,070,759,035 225,877,685,980 10.03(2009 closing)

1,531,336,361,462 1,066,277,605,204 170,235,475,978 09.03(2008 closing)

1,357,005,812,763 953,890,915,439 177,855,983,786 08.03(2007 closing)

711,491,637,979 489,773,714,311 56,103,757,24207.03(2006 the second half year)

Table 9. Reorganization of Amorepacific financial statement

Sulwhasoo showed record-high sales growth for a few years due to international market advance. However, sales were down again between in 2005 and in 2006. This is mainly because LGcare started to do business in the cosmetics industry. Sale growth rate of Sulwhasoo was approximately 7%, while O-hui&Whoo the main product of its competitor LGcare showed 23% growth rate. Amorepacific responded

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this by changing its name from Pacific to Amorepacific to be able to take a bigger share in the market.

4. 2. Sulwhasoo’s international market advance

Figure 6. Time of Sulhwasoo’s international market advance

Sulwhasoo’s international market advance - Hong Kong in 2004, the United States in 2010, China in 2011, and Singapore in 2012

After extending its business in Hong Kong in 2004, Amorepacific limited its distribution channel only to the fancy department stores and exclusive shopping area. For the first half of year in 2011, having 40% of market share in Hong Kong, it could establish premium brand image. Also, apparently, there was a reason for the market advance in Hong Kong rather than any other countries. When succeeding in making profits in Hong Kong, Amorepacific would link the know-how to nearby countries including China, Singapore, and the rest countries of Southeast Asia. In addition, Amorepacific chose Hong Kong, and the United States, because these are the countries that have the most potential and power in the world.Accounting for a larger market share would be great for exporters.

However, from the perspective of the importers, it would not be a good news owing to the intensifying competition. An era of internationalization would mean that companies are bound to analyze various market situations. Generally, nations in the northern hemisphere are important agents of economic activity. Therefore, we will focus on China in Asia, and the United States in North America

4. 3. Entering Chinese market


① Market situation

1)Market potential in ChinaChina showed unprecedented GDP growth between in 2010 and in

2011. Growth of economy led urbanization. This let the rural population move to a metropolis, naturally making them more interested in cosmetics products. In China, people coined a new word called “Beauty Economy” which

shows the popularity of beauty products. According to a survey in 2010, scale of the cosmetics market is estimated to be 9,500,000,000,000kw which is 1.5 times larger than that of in Korea. Moreover, the metropolis in China such as Beijing, Shanghai, Guangzhou has a population of up to 20,000,000 respectively. The rest of the 35 cities has a population of 7,500,000 each. That is, market in China is enormous and has a lot of potential. Sulwhasoo, therefore, found the Chinese market to be very attractive market to go into.

2)The increase of high-income bracket in ChinaThe number of high-income bracket surged followed by the rapid GDP growth in 2010. According to the report by China Market Institute, the number of high-income group increases 16% per year and the half of the people in this group was formed between in 2006 and 2010. This group apparently has the purchasing power and tends to prefer to buy quality products that have great brand image. This number increase of high-income people and their preference for premium brand are the main reasons why Sulwhasoo tried to enter the Chinese market.

3)A sense of intimacy toward Korean products From the late 1990s to the present time, Korean wave gained popularity throughout this period. This trend played an integral role for Chinese people to be interested in Korean products. Furthermore, Korean companies in China did provide the best follow-up services so far. Therefore, this largely improved Chinese customer satisfaction. This familiarity that existing companies established is one of the major backgrounds for Sulwhasoo’s market advance.

②SWOT anaylysis of Chinese market

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Strength Weakness

- Premium brand image- Accumulated marketing know-how based on earlier success

- Marketing expenses- Last-mover disadvantage

Opportunity Threats

- Expectation of an uplift in sales- Reduction of customs duties- Increased interest in cosmestics- Favorable toward Korean products due to Korean wave

- Rapid growth of Chinese cosmetics market- China joins WTO=>more competitors

Table 10. SWOT anaylysis of Chinese market

③Culture in China

1)Woman’s high status in society Unlike any other countries in Asia, woman’s social status in China shows relatively similar to that of man’s. Woman and man are thought to have the same right to make a decision at home. 49% of the population in China is women and 300,000,000 women are participating in the economic activities which is 30 times more than that of the number of women in Korea. Chinese women enjoy 4 times more shopping than Chinese men. Also, they not only have a tendency to use products shorter period than that of the usage of men but also enjoy letting other people know the features of products that they are in use. 2)Saving one’s faceSulwhasoo is targeting those women living in metropolis who always

try to keep their face. They, therefore, prefer buying imported brands and extremely rely on brand assessing the quality of products based on that. Not to mention the fact that they are not at all sensitive to any discounts, promotions, or public relations.

3)More and more people get sick due to air polutionChina is known to have bad air pollution mainly owing to yellow dust.

More and more people have to see a dermatologist for skin diseases. This mainly resulted from air pollutions. This brought people to pay attention to natural skin care cosmetics products.


4)Well-being trendWell-being trend which is focusing on everything that is healthier such

as organic food, working out regularly, using quality products etc. People now are interested in the materials and sources of any products that they are using. Since this means that they are affordable to buy items more than ever before, we can conclude that their income has risen so that they turned their eyes to eco-friendly or healthier products.

5)Korean beauty resulting from Korean wavePop culture such as Korean dramas and K-Pop is now going on to

Korean beauty wave. Specifically, organic cosmetics Sulwhasoo is getting a lot of attention from consumers. This became more famous through word-of-mouth.

6)More premium cosmetics stores in big citiesChina is now offering spaces for premium cosmetics stores. For

instance, cities such as Shanghai, Beijing where commercial development is on the progress, are occupied by premium cosmetics stores. More than 52% of the upper class who turned out to have the purchasing power reside in those cities mainly because they can afford those products.

7)Chinese women enjoy shopping and rely on the word of mouthAccording to a report by LG Economic Research Institute, Chinese

women tend to do shopping 4 times more than Chinese men. While shopping, Chinese women normally spend 12.9% of their shopping expenses in beauty treatment products. Marriage age has increased in the nation and we can see a rapid rise in the number of single woman. Single woman usually shows high consumption level and so-called ‘high-paying white collar women’ who thought to earn more than 8,000yuan per month are now emerging rapidly. This top 1% of consumers believe that the virtue of life is to consume products and very consumption-oriented. Chinese women are likely to hear from the experience of others, and this largely affects their consumption of products.

8)Value of Sulwhasoo Sulwhasoo obtained technology based on oriental medicine science for 40 years and succeeded in establishing a premium brand image. Also, by being able to keep up with hot trends such as Well-being, Korean wave, the company now is putting more value on its Sulwhasoo brand.

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④Marketing strategies in ChinaMarketing strategies in Chinese market

The same marketing as

domestic marketing

-High-price marketing : Sulwhasoo targets those higher-income group in China. Amorepacific opened two stores in the department stores after one month of its launch. They had eight stores in 2001.-VIP marketing : Specialized staff were designated to provide quality service to VIP customers.

The same but differentiated

marketing

-Oriental medicine : In China, it used to be very difficult to find skin care products that was filled with the scent of oriental medicine. Along with this, consumers tend to think that oriental medicine products are beneficial for their skin so that Sulwhasoo with the scent of ginseng became very popular.

Differentiated marketing

-target Hallyu fans in China : Japanese people look up Korean celebrities’ skin so that they have much interest in Korean cosmetics. Korean cosmetics usually target those teens and the twenties. However, since Sulwhasoo targeted those in their thirties and forties, it met the needs of Hallyu fans. Also, Sulwhasoo shows more than 70% of repurchase rate.

Table 11. Marketing strategies in China

⑤Success story

1)Targeting upper class and understanding of regional characteristicsSulwhasoo

2)Appeal to those high-paying white collar womenSulwhasoo made its target to those high-paying white collar women

who are thought to be the top 1% of the population. Those older than 35-year-old women are the essential target because they are the most affordable and apt to purchase items more than any other groups of the population. Sulwhasoo could make money out of selling products to this group.

3)Word-of-mouth marketingAmorepacific researched to find out the purchasing patterns of their

consumers. The company made its conclusion that word-of-mouth plays a


significant role for their consumption. Therefore, word-of-mouth marketing became a main source of marketing strategies.By taking advantage of this word-of-mouth strategy, Sulwhasoo became

popular even before its launch in China. It could be sold in a large scale even though it was sold 5 years later than LGcare products. After entering Chinese market, Sulwhasoo firmly established its brand image through the word-of-mouth marketing strategy, showing 70% of repurchase rate.

4)Marketing with the help of Korean waveChinese people often look up to the skin of Korean celebrities. That is,

they are often favorable to Korean cosmetics products. Knowing that existing Korean cosmetics products aimed at those teenagers and in their 20s, Sulwhasoo made its decision to concentrate on those in their 30s, and in their 40s. Sulwhasoo could appeal to those targeted groups since Sulwhasoo is made of oriental medicine products. This group also showed more than 70% of repurchase rate.

5)Oriental medicine productsThere used to be no oriental medicine products in China. Therefore,

Sulwhasoo’s moisture cream with ginseng smell was a huge surprise in Chinese market. Also, ginseng ingredient often thought to be good for skin grasped Chinese consumers attention. One thing that Amorepacific made its commitment was to let them be accustomed to those oriental medicine products by explaining pros and cons of the products in detail.

6)Analysis of population1,100,000,000 people out of 1,300,000,000 live in big cities which

shows higher density in cities. Women are likely to be involved in economic activities. Women have almost the same social status as men. To be able to figure this out, Amorepacific surveyed 3000 local consumers before making its launch in China.

7)Trendy product, Sulwhasoo Using quality ingredients and oriental medicine as a source of their products, Sulwhasoo laid the foundation in Chinese market. The fact that Chinese people were not repulsed by the oriental medicine products was one of the reasons of its success too. Luckily, Sulwhasoo products did not need to go through any legal process or customs at that moment. Moreover, Chinese people were favorable to Korean products with the help of K-Pop and the Korean wave. Those who experienced Korean

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Beauty showed high repurchase rate with brand loyalty. By instantly responding to trends in China, helped make sale accelerated as a whole.

⑥Sales performance The total sales in China after Sulwhasoo’s launch

Table 12. China market sales results(2011) China market sales results(the first quarter of 2012)

The fourth quarter in 2011

Sulwhasoo’s Chinese market advance. Sulwhasoo raised its brand awareness through VIP marketing in Beijing and Shanghai.

The first quarter in 2012

VIP promotion in Beijing and Shanghai to raise Sulwhasoo’s brand awareness.

4. 4. American market advance

①Market situation

1)Continuous cosmetics market growth in the U.S.Cosmetics and beauty treatment industries in the United States are

estimated to be the largest market in the world. Except when sales scale went down 0.1% in 2009, sales in cosmetics industry is on the rise. Sulwhasoo turned to see a bigger market fearing from the saturated Korean market situation.Sales scale of anti-aging cosmetics exceeded that of skin care market by

2% between in 2006 and in 2008. Aiming the same group of consumers,


the increase of the sales scale of anti-aging cosmetics market became an essential reason for Amorepacific’s market advance in the U.S.

2)Oriental medicine products were of interest to Americans From the early 2000 to today, Americans were becoming more and more interested in oriental medicine products. One thing and the last thing they can do to overcome the western medicine was turn to oriental medicine. Oriental medicine and acupuncture is being used to relieve pain in reality. Also, people multinational pharmaceutical companies read a lot of oriental medical volumes for their reference.

②SWOT analysis

Strength Weakness

- eco-friendly product by using natural ingredients- profit maximization by selling high-price products- classy design

- those who have no purchasing power are not willing to buy Sulwhasoo products- not enough brand recognition

Opportunity Threats

- Americans have a good feeling toward oriental beauty- the increase of the number of consumers- classy design

- high entry barrier due to global brands

Table 13. SWOT analysis of American market

③Culture and trends in the U.S.

1)Americans value brand imageBrand image is assessed in terms of its technology, design, and

freshness. Brand image is not something that can be built within a short period of time. Therefore, to meet the needs of American consumers, it is recommended to avoid low price strategy and a short-term policy.

Sulwhasoo 23

2)Americans value design Design of Sulwhasoo products is highly recognized because it captured the oriental beauty in a modern way. Wrapping design is also an important factor. Consumers not aware of any features of the product have to make choices by looking at its cover. Visual factors expressed by its wrapping design have to be a great means to promote sales. Wrapping design, thus, does its part of alluring consumers.

3)Organic as well as eco-friendly trends Eco-friendly way of life is becoming a new lifestyle trend these days making natural beauty product popular. More recently, natural cosmetics products including beauty treatment market and make-up products are popular. This is because carcinogens are detected in the mercury cosmetics products as well as in the premium cosmetics products many times. People now are in pursuit of organic cosmetics products.

4)Brand value of SulwhasooSulwhasoo has a oriental medicine based technology, a premium design,

and uses organic natural materials for cosmetics products. Sulwhasoo also has freshness that Americans value the most.

④Marketing strategies in the U.S.

Marketing strategies in the U.S.

The same marketing as

domestic marketing

-Premium marketing : Amorepacific mainly focused on the fact that Americans generally find the Oriental to be mysteriously attractive. With this bearing in mind, in 2010, Amorapacific could be part of the Bergdorf Goodman by turning oriental beauty in a modern style. Bergdorf Goodman also chose Sulwhasoo as an optimal brand that can satisfy New Yorkers’ interests in Asian culture. -High price strategy : Sulwhasoo set the price higher than the price set in Korea to provide high quality products.


The same but differentiated

marketing

-Interior showing oriental beauty : Sulwhasoo showed its oriental beauty by engraving interiors with flowery patterns and Chinese characters. Even though there used to be a strict restriction on interior design, Bergdorf Goodman exceptionally allowed Amorepacific to design interior their own way.

This is not even originally a differentiated way of※ marketing strategy from the one being used in Korea, but a great strategy that can appeal to those in other countries. Which is why this is not exactly the same but differentiated marketing strategy.

Figure 7. The design of Sulwhasoo store with traditional patterns

Differentiated marketing

-Experience based marketing : Sulwhasoo built-up its image by letting customers to experience ‘Oriental Beauty’ in ‘Spa Salon’

Figure 8. Sulwhasoo ‘Spa Salon’Table 14. Marketing strategies in the U.S.

Sulwhasoo 25

⑤Reasons of success

1)Analysis of the skin of white people White people account for more than 80% of their population, while African Americans account for 15% of the whole population. Therefore, cosmetics market targets those white people. White people face skin aging more rapidly than other people, which is why they are interested in quality cosmetics products. Consumers, nowadays, shows interests in skin care products that is functional as well as good for health.

2)Introduction of Korean culture to the U.S.Amorepacific tried to raise awareness of its brand by introducing beauty

gallery and spa. With globalization, Americans are also paying a lot of attention to Korean culture.

3)Brand positioning by focusing on high class people Along with high price strategy, Amorepacific sold products solely in the department stores. Every brand has to go through complex processes to be able to get into the Bergdorf Goodman, which is known to be the best department store in the United States.

4)Attracted Americans who value design Neiman Marcus, as a global department store, is famous for its unique items such as universe travel ticket, exorbitant price chicken coop. Once, Sulwhasoo was invited to Neiman Marcus department store for products’ oriental beauty. After Sulwhasoo being chosen as a present item by Neiman Marcus, it could occupy 27 stores and sell products in the Neiman Marcus department stores.

5) Sulwhasoo dig into characteristic of Americans Sulwhasoo products formed a social consensus by knowing Americans’ skin type, cultural characterization, their personal preference. Neiman Marcus department store promoted cosmetics products from the late February in 2013 to early march in 2013. During this time, Sulwhasoo showed sales increase by 80% while other brands showing increase in sales by up to 10%. This demonstrates how Sulwhasoo products are competitive in the U.S. market. By now, Korean cosmetics products had trouble getting into American market. Selling products only to those Korean resident abroad have limitations. When trying to break into American market with same


strategy devised in Korea did not work well. This is because this domestically devised strategy has not considered Americans’ tastes on products. Realizing the weakness Sulwhasoo, surely not to repeat this failure, came up with differentiated idea resulting in great success.

⑥Sales performance

.

121 157 188

Table 15. US market sales result newspaper, Korean beauty worked in the U.S. market. 2012, 11 We have analyzed what differences it has depending on the types of

marketing strategies. According to ‘Um Kyung-hee’(2002), products of global brand are not usually assessed by its quality but by the company’s history and brand image. Sulwhasoo, therefore, has prerequisites to be a global brand.It is now time for Sulwhasoo to be sensitive to consumer participation.

Consumer participation is a community or individual involvement in the decision-making process. Also, major reasons that have an influence on the consumer’s decision-making process can be classified as cultural, societal, individual, psychological factors. Thus, Amorepacific need to be aware of consumer participation as well as 4 factors that affect consumers’ decision.

5. The key to success The key to success can be summarized with five points.

5. 1. Oriental medicine brand identity Sulwhasoo’s oriental medicine philosophy melted into visual factors such as the color and package. Pottery shaped container with traditional

Sulwhasoo 27

‘Oh-bang’ color showed products’ unique characteristics. Additional gold color showed its noble image. Oriental medicine brand identity was more than these colors. Amorepacific even added more. Especially, ‘Sulwhasoo spa’ helped establish oriental medicine brand image by providing oriental type of skin care solutions. ‘Sulwhasoo spa’ plays an integral role not only in Korea but also other countries including Hong Kong. With these various activities are the main factors contributing to the highly recognized brand identity. Sulwhasoo, in conclusion , is a optimized cosmetics those looking for oriental medicine products.

5. 2. Technological featuresQuality of Sulwhasoo products was a driving force for the success.

Sulwhasoo products go through a certain process for a better quality. First of all, every oriental medicine material for a finished good is domestically produced. 200 different types of Chinese herbs are being cultivated. Scientific product research is underway as well. Amorepacific formed a task force studying more about Sulwhasoo products. 500 people in the KyungHee University, KangWon University, and Ewha Women’s University are participating in the process of the product development. As am outcome, Sulwhasoo has 200 patents, and 300 research papers. This effort allows Sulwhasoo products to survive in the competitive markets.

5. 3. Culture marketingSelected materials, emotional design are the concepts for theSulwhasoo

products. Craftsmen designated as intangible cultural asset showed up in the TV advertisement, differentiating itself from the competitors who hire models for the advertisement. Also, for the concept of culture brand, Amorepacific distributed products only through the department stores, door-to-door sales, and tax-free goods on board. They tried to combine Korean culture and oriental beauty in the design of the containers.Besides, in connection with corporate social responsibilities,

Amorepacific is using culture marketing strategy. Corporate social responsibility is a form of corporate self-regulation integrated into a business model. Corporate social responsibility is a process with the aim to embrace responsibility for the company’s actions and encourage a positive impact through its activities on the environment, consumers, employees, communities, stakeholders and all other members of the public sphere. For instance, by creating ‘Sulwha maven club’, it allows


members to accumulate point that can be used later to experience traditional culture. Being connected to various cultures, Sulwhasoo conveys its color very well. Culture marketing, thus, basically plays an essential role drawing consumer’s attention.

5. 4. Premium strategy For women, they can express their image through the cosmetics products. Sulwhasoo took purchasing disposition into consideration and set premium image at the head of their strategies. People can sense a feeling of exclusivity in the package design of Sulwhasoo.Sulwhasoo even differentiated its distribution channel. From the

moment when it launched Sulwhasoo products, it was only available either in the department stores or door-to-door sales. By doing this, Sulwhasoo accounted for more and more market share, resultingly becoming a main brand. Unlike any usual marketing strategies such as handing out sample, a cut-price sale, Amorepacific even differentiated its advertisement. Also, they try to meet the needs of high class people by providing them with limited edition, special edition etc. 5. 5. Driving force of international market advanceSulwhasoo made an eye-opening progress in the international markets

with the help of the premium strategies. First step was in Hong Kong. In Hong Kong, Sulwhasoo had the support of most of the upper class people. Plus, premium strategy was also a critical success factor.In China, upper class people take into account brand and quality when

purchasing cosmetics products. Sulwhasoo gratified their desires by being equipped with premium brand, high-price, and great quality. Also, Amorepacific came up with local marketing strategies for the local consumers and tried to meet the needs of white collar women. Word-of-mouth marketing strategy turned out to be effective as well. Premium marketing was used in the U.S. as well. Even high-price

strategy helped boosting sales. Amorepacific proved its value by being part of the best bergdorf goodman department store in 2010. Oriental medicine brand identity, premium strategy, and so on are the main cause for Sulwhasoo’s success in the United States.Sulwhasoo holds a special place in consumers’ heart from the Hong

Kong market advance in 2004, the U.S. in 2010, the China in 2011, and Singapore in 2013. Now, Amorepacific is ready for another challenge in Southeast Asia.

Sulwhasoo 29

6. Marketing suggestions

6. 1. ‘Inner beauty’ as a Sulwhasoo’s new breakthrough

①One example that made profit with Inner beauty products

1)’collagen beverage’ as a source of profit in Japanese cosmetics market ’Collagen beverage’ came up as a new source of profit in the Japanese

cosmetics market. ‘Collagen beverage’ is one of ‘Inner beauty’ products that promote skin elasticity. At that time, ‘collagen beverage’ became a new profit source using distribution channels such as pharmacy, supermarket.

2)Success story : Shiseido ‘Shiseido the collagen EX’

Sales of Shiseido’ collagen products have increased and it exceeded 10,000,000,000yen when in 2008. To raise brand awareness, the company unified different brands into ‘Shiseido the collagen EX’. Shiseido the collagen products maintained 20 to 30 percent more sales record than of the year

Figure 9. the collagen EX before.

3)Success story : Kanebo ‘Collagen Deep in’

Kanebo cosmetics were sold as of 2009 targeting people in their 30s. It has been known that the secretion of growth hormone is rapid when one is in sleep. Therefore, the company persuaded consumers to drink

Figure 10. Collagen deep in


‘Collagen Deep in’ just before going to bed. Even though this was very exceptional, it succeeded in catching the public eye.

②Current situation : the boundary between cosmetics and Inner beauty products is disappearingPeople used to apply cosmetics that contain collagen or hyaluronic acid

in the past. However, the trend is changing. People now are getting accustomed to taking in these ingredients spreading Inner beauty trend. Ingredients of Inner beauty products are becoming more and more diverse including collagen, hyaluronic acid, and red ginseng. Food company and pharmaceutical company are introducing this trend. Amorepacific and LGcare are also extending its business.

③The reason why Sulwhasoo has to launch Inner beauty products

1)Sulwhasoo’s consumers trust oriental medicine.Inner beauty is not just improving skin by applying cosmetics on the

surface of the skin but reforming fundamental skin problem by changing eating habits or life habits. This is similar to the theory of oriental medicine that everything is closely linked to each other. Oriental medicine often refers treatment with Chinese herb medicines. Sulwhasoo is also a product made from Chinese herb medicines. Those consumers who have trust in oriental medicine are likely to rely on Inner beauty products. Therefore, extending business to Inner beauty products will open a new field for profit.

2)Introduction of Inner beauty brand with the concept of premium cosmetics conceptSulwhasoo combines the effectiveness of oriental medicine and oriental

sensitivity to be able to recognized as a premium brand. Also, high-price strategy worked out perfectly resulting in higher sales. If this kind of premium brand concept is applied in Inner beauty products pertinently, the company would be able to introduce another successful brand into market.

④Expected effectOverall expected effect

Sulwhasoo 31

-Profit creation from new business(Inner beauty) -Image promotion by using natural oriental materials.-Premium image

Promotion expected effect-Promotion through mobile phones and applications in order to diversify its customers.-Additional profit resulting by running tea shop -Premium image with the help of magazines/newspapers advertisements.

Table 16. Expected effect

6. 2. Sulwhasoo’s men’s cosmetics market advance

①Background : an explosion of interest in men’s cosmeticsSales of men’s cosmetics market is on the rise even though the market is

very competitive. According to KOTRA, sales of men’s cosmetics market increases at a very rapid pace. Even the skin protectants showed 40 percent increase in sales in 2010. Men’s cosmetics market has a great potential for business because sales of this market is estimated to be higher than 8,000,000,000yuan.Men in the present era actively try to express themselves seeking for

individuality. The change in lifestyle transformed the way men live and opened a lot of new possibilities. Men in cities where economic level is high such as Beijing and Shanghai tend to be more interested in their look, leading to more purchase of men’s cosmetics. This shows there is a huge market opportunity in China.

②market condition of Sulwhasoo’s men’s cosmeticsEven though Sulwhasoo has 18 different product lines, it only has one

product for men. This business is in its infancy.


Figure 11. Sulwhasoo man's cosmetics

③Suggesting an alternative : marketing strategy for men’s cosmetics in China

1)Make use of Sulwhasoo’s premium brandNowadays, Chinese men put an emphasis not only on the effectiveness

of cosmetics but also on its brand. Therefore, taking advantage of Sulwhasoo brand would make it easier for the company to take one step closer to the consumers.

2)Development of various product linesOwing to the sharp economic growth, men in their 30s and 40s have a

different view on self management. This is especially true for those successful men in society. They value their face. Since they have money saved they are able to make purchase of expensive items. Thus, Sulwhasoo’s high-price brand strategy suits best in this market.

6. 3. What Sulwhasoo came up with is ‘Big Data’

①Definition and features of ‘Big data’In the early days of the advent of Big data, it just meant a lot of data.

However, now, big data is the term for a collection of data sets so large and complex that it becomes difficult to process using on-hand database management tools or traditional data processing applications. Big data is difficult to work with using most relational database management systems and desktop statistics and visualization packages, requiring instead “massively parallel software running on tens, hundreds, or even thousands of servers. What is considered big data varies depending on the capabilities of the organization managing the set, and

Sulwhasoo 33

on the capabilities of the applications that are traditionally used to process and analyze the data set in its domain. “For some organizations, facing hundreds of gigabytes of data for the first time may trigger a need to reconsider data management options. For others, it may take tens or hundreds of terabytes before data size becomes a significant consideration.

②Big data’s prospectTo be able to have comparative advantage over other competitors,

companies need to understand customers in depth and have to provide differentiated services so that they can survive. In regard to that, big data will be a next-generation growth power. Semi-structured data contains market trends, client attitude, one’s feelings and everything. By installing a software that manages big data, companies will be able to customized services.Individual consumers can take advantage of big data in many different

ways. Consumers can save time and money by making a data-centered decisions that otherwise would have been wasteful.

③Present status of Big data use by Korean companiesEven though Korea has laudable IT infrastructure, not many are taking

advantage of it. This is because we were not able to systematize database and analyze information to make use of it for ourselves. Korean companies are now aware of the products that consumers buy the most and are interested in. Shops have data accumulated in their computers. However, headquarters have no capability to do it. Therefore, for Amorepacific to become a global company, it should be able to accumulate, manage, and analyze information so that they can meet customers’ needs.

④Accumulating information with SNSNowadays, we can even accumulate necessary data by using SNS.

According to J.H. Kim(2912), customer information profiling would help the company figure out potential customers’ characteristics. With the help of SNS, companies can have better targeting of promotions. Sulwhasoo’s main target consumers are in their mid thirties whiles SNS’s target consumers are in their twenties to thirties. Thus, this will promote insurance of customers in the long run.

⑤Proposal of alternative : Beyond chasm


Tim O'Reilly said “Winners in our future generations will be those who secure a lot more users and turn this clientele into a system.Countless products are produced every single day, however, most of

them disappear not being able to go beyond chasm. Thus, to be able to secure many users, it is essential to know customers’ characteristics. In this sense, Big Data can be a great alternative. With the big help of Big Data, companies would know what customers needs and effectively invest and manage.

Figure 12. Consumer distribution ratio

With this in mind, we defined Sulwhasoo’s foreign market advance as an early adopters stage. To go to the next stage, which is late adopters stage, companies need to capture customers’ hearts. Earlier we mentioned that it is essential to consider factors that have influence on consumers’ purchasing intention. The most effective way to boost consumer participation is to arouse customers’ desire. Big Data surely can play a huge role in doing this. Therefore, it is highly likely that Big Data would help companies to success in breaking in new markets.

7. Conclusion We have researched how Sulwhasoo succeeded in both national and

international market, and proposed some ideas. Three times of crises that Sulwhasoo faced were due to saturation of domestic market, economic downturn and not enough market research. By knowing this, we proposed alternatives for these crises. From now on, we will come to a conclusion in terms of economy as well as marketing.

Sulwhasoo 35

①Making profitsAmorepacific made profits targeting a niche market. According to

National Statistical Office, the whole number of population is 51,047,880 people in 2013. When Sulwhasoo first tapped international markets the population of Korea was 48,423,799 people in 2004. Economists argue that a nation should at least have 100,000,000 population for domestic market activation. However, Korea is not reaching that figure yet. Therefore, it was necessary to look around for more profits.

②Changing one’s way of thinking and benchmarkingSubprime mortgage forced the world into a financial crisis in 2008.

Sulwhasoo who used high price and premium marketing strategy showed relatively slower growth due to the economic recession. This allowed customers seek for cheaper price products. However, it did not make sense to change their marketing strategies. If that happens, those who favored Sulwhasoo products are likely to turn their face away. In this case, it was important to benchmark those similar cases which made us take a closer look at Japans’ situation. Even though they faced same circumstances, they captures customers’ hearts with inner beauty products. By changing one’s way of thinking that we can we cosmetics products, they approached customers in a more friendly way. Any companies are dependent on external stimulus. When thinking

differently in these situations, companies can survive. In this sense, we propose edible cosmetics products which combined characteristics of oriental medicine and inner beauty.

③Trend It is common sense that companies take the role of product production and consumers purchase them. The 20th century is the time of 4C(Consumer, Cost, Convenience, Communication). Consumers do not make a purchase only if products are good enough. Consumers do make a purchase to be able to be happy with the use of them. To capture consumers’ heart, companies need to establish brand image, provide convenience to customers and communicate with them. When competitors stepped in the market where Sulwhasoo was leading, Amorepacific took that into account. It turned out that Amorepacific was not doing enough research for consumer behavior because they were monopolizing the market. From this experience, Sulwhasoo paved the new way for reform. They analyzed consumers’ behavior to be able to provide them with best service and proposed Big data as an alternative.


Foreign companies are making use of Big data. However, Korean companies are not necessarily taking advantage of it. Analysis of Big data would help companies lead the market. Especially, localization strategy, premium marketing strategy and Big data acquisition would allow Amorepacific to be successful in foreign markets.

With this marketing contest, we learned how companies make decisions when it comes to marketing. Amorepacific dominated domestic market by selling oriental medicine product ‘Sulwhasoo’ which has different characteristics from those foreign cosmetics. Surprisingly, it remains number one oriental medicine brands in the international level with various differentiated marketing strategies. Sulwhasoo could make it by overcoming a couple of difficulties that they faced and judging market situations coolly. Secondly, with Sulwhasoo’s case analysis, we studied the field of

international marketing and the need for it. Amorepacific started global management to overcome intensifying competition in domestic market and the increase of imported foreign cosmetics. Now, Sulwhasoo went into a lot of Asian countries, and the United States. Sulwhasoo’s case let us realize the importance of market research, demographic as well as regional features. And we have to have different international marketing strategies depending on countries.This marketing contest helped me grow in three different ways. First of

all, it broadened my perspective. I happened to put myself into consumers’ shoes and thought a lot from their view. Secondly, I realized the significance of group work. For example, we assigned different works to individuals and solved problems by communication and compromise. Lastly, it was a whole new different experience for us. This was because we were able to met experts in the marketing field and learned a lot from them.Sulwhasoo succeeded in differentiating its product by making people

understand that Sulwhasoo is an authentic oriental medicine brand. Not only did it make use of traditional five colors on the pottery, but also it used high quality oriental medicine materials. This did help Amorepacific have a brand identification. In short, the very Korean styled beauty become competitive enough to open entry barrier of global brands. Based on domestic culture and characteristics, Amorepacific could find out an item originative and became an example to everyone who would like to jump up to be the global brands in the world.

Sulwhasoo 37

Individual comments

Name : Choi Yun-Ju School : Dongguk University A school subject : International tradeCell Phone : 010-4303-0188E-mail : [email protected] I learn many things from this contest. Amorepacific find chance from fail. After all, they success at world market. Amorepacific products face stiffer competition from other company items in the global market. We research number 1 cosmetics brand in Korea. It is very good experience. Based on these things, I dream forward to grow further one step.

Name : Cho Byung-WooSchool : Dongguk University A school subject : Journalism and Mass communicationCell Phone : 010-4199-0419E-mail : [email protected] project was a great opportunity making me foresee my future

through past experiences. Analysis of a company in a detailed way let me comprehend how the company could obtain no.1 brand power in the international market. By looking at this process, I felt that I could always control myself whenever I face any hardships. Name : Wang Hong-Jin School : Dongguk University A school subject : Journalism and Mass communication Cell Phone : 010-3174-8327E-mail : [email protected] exists a great number of markets and numerous products come out

as well. This contest let us know more about the stories of those products. The most important thing for us to elaborate stories of the products is marketing strategies. Marketing strategies of Sulwhasoo would act as a huge stimulus in making my own story.

References


Dissertations1. Ko, Yeon-Jin(2006) , “A Study on the Successful Cultural Marketing Strategy in Developing Cosmetic Brand” , Graduate School of Design, Ewha Woman’s University2. Um, Kyoung-Hee(2002), “A Study on Brand Image Evaluation to Products of Overseas Famous Fashion Brand” , Graduate School of Hanyang University3. Lee, Myung-hee(2005), “A Study on Customer’s Behavior on Purchasing Oriental Herb Cosmetics”, Graduate School of Food & Drug Administration, Chung-Ang University4. Zhong, Jia-Yi(2011), “A Study on the Marketing Strategy of AMORE PACIFIC Cosmetics to Penetrate China Market”, Graduate School of Business Administration, Dongeui University5. Seo, Myoung-Sun(2006), “The Marketing Strategy toward Consumption Polarization Trends : The case of cosmetic industry”, Graduate School of Techno Business, Sookmyung Woman’s University6. Park, Woon-Sang(2013), “Future Society Through Big Data”, National Assembly Library, Article 50, No. 27. Chae, Seung-Byeong, Jeon Sang-In and Ahn, Shin-Hyun(2012), “Big Data : Industry Cataclysm epicenter”, CEO information, Samsung Economic Research Institute, No. 8518. Kim Jong-hyun(2012), “An Empirical Study of SNS Customer Targeting Profiling Model Based on Big Data Analysis”, Graduate School of IT Policy and Management, Soongsil University9. Yoon, Gak and Seo, Sang-Hee(2012), “A Study on Corporate Social Responsibility and Corporate Advertising Affect Corporate Image and Brand Attitude Formation”, Korea Broadcasting Advertising Corporation, Advertising Research, No.6110. Kim Yu-jin(2012), “Sustainable and Socially Responsible Management on Film Value”, The Graduate School of Accounting, Hanyang University11. You Sung-shin(2012), “Research on Effectiveness on Advertising Impact of Representation Method from Corporate Advertisement : Focus on Corporate Social Responsibility(CSR) Advertisement”, Graduate School of Industry, Hongik University12. Jeon, So-Young(2007), “A Case Study on the Effect of VIP Marketing Seen through the Prestigious Cosmetic Industry”, The Graduate School of Mass Communication, Sogang University13. Jung, Seung-mi(2011), “The Effect of Overseas Luxury Cosmetics Pre-tester Reviews on Consumer Purchase Behavior”, The Graduate School of Clothing and Textiles, Sookmyung Woman’s University14. Korea Health Industry Development Institute(2009)“Cosmetic & Beauty Industry Data Bank”, Korea Health Industry Development Institute15. Oh, Dong-Eun(2011), “A Study on the US Consumer’s Purchasing Behavior in Cosmetics”, The Graduate School of Distance Learning, Sookmyung Women’s University

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16. Gwak, Sa-Yo(2003), “A Study on Purchasing Properties of Men in China and the Development of Future Selling Market”, The Graduate of Management, Joongbu University

Books1. Han, sang-man(2007), "Global Strategy of Sulwhasoo", Korean Journal of Marketing, October 3week, 187-208 2. Korea University institute for business research & education and The Federation of Korean Industries(2012), "Corporate management way", FKI media3. Song Young-hee and Heo, Won-moo(2008), “A Case Study of Marketing Communication Strategy of Premium Brand, 'Whoo'”, The Korean Journal of Advertising, Vol. 19, No.2, pp203 - 2204. Wally Olins(2006), "On board", Thamas& Hudson5. Choe, yun-hee(2008), "Modern Public Relations theory", Nanam6. Shin, yu-keun(1988), "Corporation and Society", Kyungmoon7. Paul R Gamble, Alan Tapp, Anthony Marsella and Merlin Stone(2007), "Marketing Revolution : The Radical New Approach to Transforming the Business, the Brand, and the Bottom Line", Kogan Page8. Peter Kreuz(2006), “The Law of Future Business”, Book Planner9. Monthly Magazine “Marketing”(2006), Korea Marketing Association10. National IT Industry Promotion Agency(2013), “Big Data Will Bring Innovative Changes in the Consumer and Small Business”, Weekly Economic Trends, No. 158411. Kim, Dong-han (13, February, 2013), "Core platform of BiG Data and Corporate Hadoop trends", Weekly technology trends

Articles1. Lee, Seong-Hee reporter (02, March, 2009), “Why Chinese tourist find Sulwhasoo cosmetics?” , Han kook Daily News 2. Lim, Chi-Hyun(01, November, 2011), “Hong kong’s luxury Hallyu represent.,Kotra Hong kong Trade Center3. Seo, Hyun-Sun (the Pacific Marketing part director) (2009), “Success strategies of the Overseas Pacific and Global marketing strategies analysis – France, China” / “Global brand strategies and core competencies of cosmetics market - 「Sulwhasoo」 of Pacific”4. Kim, Li-Kyung (Osaka Trade Center) (09, November, 2009), “Notice collagen craze blowing to JAPAN.”, Korea Trade-Investment Promotion Agency5. Rural Development green future strategy team (03, January, 2011), “Weekly Green growth trends”6. Sim, Hee-Jung, Lee and Su-Min reporter (17, February, 2013), “Increase eating ‘inner beauty’ products”, Seoul economy


7. Jung, Hyun-Hye reporter (10, January, 2013), “Seo, Kyung-Bae Amorepacific owner, look over health food market”, etoday.8. Yoon, Ji-Won reporter (01, June, 2012), “Warring Statesera ofinnerbeautymarket” , Beauty Han kook9. Heraldcorporation (25, May, 2011), “Amorepacific ‘Sulwhasoo’ VS LG care ‘whoo’, Who is final winner of China War?”10. Jung, Goo-Hyun (2008), “Global management of Korean corporation”, Wisdomhouse.11. Yu, Ju-Yeon reporter (29, February, 2012), “Being treated Sulwhasoo in Duty-free shop… Sales doubled every year”, Maeil Business Newspaper12. Lee, Hong-Pyo reporter (23, May, 2012), “Paradigm to change the world, ‘Big Data’ Hardware vendors ‘promising’”, Han Kook economy13. Cha, Yoon-Tak reporter (22, March, 2013), “If your company doesn’t want bankrupt, stand Big Data in SNS”,Maeil Business Newspaper14. Go, Byeong-Su reporter (28, November, 2012), “’Beauty of Korea’Sulwhasoo makes sense in USA.,Naeil newspaper.

· web viewword-of-mouth marketing strategy turned out to be effective as well. ... people used...

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