Xu Qingpei will also look at China. However, the process is not smooth -- peer cultural differences between China and South Korea is very obvious. Amore Pacific Group President China and China Taiwan Gao Xiangqin joined the company in 2012, when there is one thing to remember. When he went to the South Korean headquarters and Xu Qingpei chat, he was not in the habit of Korean colleagues. "Several South Korean colleagues surnamed Kim, I don't know how to call them, like the lack of a bridge." Gao Xiangqin recalls. Previously, he served as Procter & Gamble, Estee Lauder China executives, in America enterprisework, colleagues will call each other names English. In Korea, is not the case.

Xu Qingpei quietly listening to all this, and made no answer, but he has been using a mobile phone silentlyrecord. It is his special way of communication, every time after the problem, he will fall into a long silence,only carefully in the paper record before one one.

Subsequently, Xu Qingpei sent an email to the human resources department requirements, Chinese district staff must take a English name. "He didn't give me the answer, decided directly to do. He is in the process of globalization, each country to recruit talent, so he can go far. He pays much attention to communication,which he gave me a deep impression." Gao Xiangqin told the "Global Entrepreneur".

Xu Qingpei realized China is a hotly contested spot. Because the number of South Korea's land area and population of only 1%, 4% Chinese, limited market capacity. And China has leapt to the world's secondlargest cosmetics consumer. Euromonitor data show, the global cosmetics industry in 2013 sales of $454400000000, 2009 compound growth rate of 4.9% to 2013, and China cosmetics industry, this figure is as high as 13.2%, the market scale reached 269000000000 yuan, compound growth can still keep 11.5% of the next five years. But Chinese per capita cosmetics consumer spending only $25.8, compared to $167.9 in Japan, South Korea's $216.4 and $350.5 American, there are still several times the gap.

This means that the huge consumption potential. L'Oreal, Procter & Gamble, and so on China market look at fiercely as a tiger does Estee Lauder, amore Pacific also have high hopes, Xu Qingpei that average annual growth in 2020 Chinese market rate can reach 41%, achieve 3.3 trillion won of sales revenue, andcontribute to the global total sales 28%.

In order to achieve this goal, Xu Qingpei in the early 90's of the last century began to set foot in Chinese.Amore Pacific China deputy general manager and plant manager Zheng Jingzhu is one of the earlyfollowers. Zheng joined amore Pacific Institute of technology in 1983, 1994 as the Shenyang Pacific Baoyancosmetics Limited company director. "I began to learn Chinese from 1985, when the school Chinese ispreparing for the future. When I do not know Chinese Pinyin, are learning phonetic symbols and charactersof Taiwan." Zheng Jingzhu told the "Global Entrepreneur". In order to expand the market China, amore Pacific recruited a large number of Chinese fluent Korean employees, now South Korea is still open Chineseheadquarters even class employees, employees can call the course of study in this paper.

In the 90's of the last century, to Chinese investment will not be easy. In China and South Korea established diplomatic relations, Xu Qingpei began looking for the opportunity to China. Then Chinese in South Koreahave not set up the embassy, to Chinese must pass the entry of Hongkong. Zheng Jingzhu was still learningChinese, one day, suddenly have to ask who will Chinese, so the opportunity to come. The companyarranged for 20 weeks Chinese course for Zheng Jingzhu, Monday to Friday, 7 hours a day of intensivestudy Chinese. In 1992, Xu Qingpei decided to invest and build factories in Shenyang, Zheng Jingzhu volunteered to serve as director.

First China market, company development difficult. Amore Pacific in Shenyang to invest $2000000 to set upthe Shenyang Pacific Baoyan Cosmetics Co., Ltd. is a Sino foreign joint venture enterprise, China contributed 20%, amore Pacific invested 80%. In order to put into production as soon as possible, Xu Qingpei decided to use of the existing plant. "At that time China situation is not very good, all the equipment,raw materials and packaging materials are almost all from Han Guoyun." Zheng Jingzhu recalls. In December 24, 1994, the factory was first put into production, the first batch of products is the dew.

Channels is difficult. At that time, all the department stores of goods made of glass cabinet display, nocosmetics counters even in Shenyang the most popular ZTE mall. In 1995, amore Pacific has established the first department store cosmetics counters in zte. "Although the scale is not large, but only two years, we will generate a profit, began to have some confidence, think Chinese is the future market. Not only the brandpopularity up, but also to enhance the awareness of the company." Zheng Jingzhu said.

But Shenyang is not the development of cosmetics heavy. Soon, amore Pacific will be transferred toShanghai. In 2002, it set up a factory in Shanghai, in the high-end brand Laneige also through ShanghaiHuaihailu Road Parkson Department Store officially stationed in China. In order to fame, amore Pacificcommissioned Nielsen market analysis, the report's conclusion was Laneige's entry into the market will failChina. But Xu Qingpei remained unmoved, he believes that to enhance brand awareness, Laneige had to enter the market China. At that time, Laneige only through department stores sales channels, Estee Lauderand other international brands have set up counters in department stores, and therefore do not have a competitive advantage.

By 2003, Laneige in the Chinese market is still only a counter. In order to reverse the predicament, thenChina district sales manager suggested to Xu Qingpei Laneige sales, which allowed the proposal. At this time, a large number of international brands in the market Chinese and the rapid expansion of Laneige, will be adjusted to import goods sales strategy for the market promotion -- consumers accept the South Koreanproduction of Laneige. "While Shanghai and South Korean production of Laneige is the same, but it is morelike the South Korean production. Department store manager also imported like products. The characteristics of cosmetics is such, it is the cultural character of strong product." Zheng Jingzhu said.

Seeking potential

After this incident, the rapid rise of the Laneige brand in the China middle class consumer groups. In addition to the product of its high price, Laneige's success also benefited from the strong South Korean popculture. As early as 2004, amore Pacific invited from "My Sassy Girl" and became popular in Asia, South Korean actor Gianna Jun as the brand ambassador, Laneige quickly accepted by consumers. After that, the product placement marketing companies is to get instant results. Another part of you come from the starsbecome fashionable for a time "" make amore Pacific brands selling. Many fans will be more China play Gianna Jun used lipstick, cushion BB cream, hair oil on the shopping list. A similar situation also occurred in the Republic of Korea -- those with high popularity, can make all kinds of sponsorship products quickly sold out female artist even has an exclusive synonymous full pin female - "". Gianna Jun is undoubtedly the mostpopular "pin female" typical.

The number of tourists to Korea shopping has increased dramatically. In 2014, South Korea more than other countries, has become the most Chinese's outbound tourists destination. And Chinese visitors to the mainconsumer categories focus on cosmetics. Korea Tourism Organization survey in 2013 showed the foreign tourists travel to Korea, more than 50% people have purchased the Korean cosmetics.

Seoul Dong has therefore become one of the main gathering place of China tourists. Many shops are equipped with said Chinese shopping guide, in the middle of the street there was a huge banner ChinaChinese welcome visitors. In the District, row upon row of cosmetics shop, from Hongkong, Japan to the drug store cosmetics set store form, the most common Korean cosmetics brand stores. Each brand independentstores, from skin care products to cosmetics products Goods are available in all varieties., each storecontains hundreds of SKU, the whole street is like a huge warehouse cosmetics.

Xu Qingpei catch the trend. A total of 127 cosmetics shop in the main street, a few shops amore PacificGroup's green and her house was respectively eight and seven. The Korean wave driven, as early as in 2012, amore Pacific has become a cosmetics company China market the fastest growth, the growth rate as high as 34%, far higher than the cosmetics company ranked first in the L'Oreal year growth rate of 13%.

South Korean cosmetics company also benefited from some small. In 2014, has sold the mask brand Lideposture of the South Korean Mountain Star Life Science Corporation's stock rose seven times. Due to strong sales, mountain star life science sales in the first half of 2014 increased by 139%, to reach 28700000000 won, and 80% of the products sold to customers Chinese.

One of the reasons is that the South Korean manufacturers sales more Asian skin and aesthetic standards.Universal education of beauty in South Korea is very developed. Students will be arranged by the schoolafter graduating from high school to learn make-up, clothing company also often go to the campus, dress collocation skill teaching. In the cultural output drives the sales of goods has become Gu Youmo amore Pacific and other Korean companies.

In addition, the South Korean cosmetics are usually mild, in color, more the pursuit of nature, which is different from Europe and the United States and Japan brand. "In 1954, we established the first study of Korean cosmetics industry, we understand the Asian women's skin and beauty trends more than other companies." Amore Pacific Group chief strategy officer Kim Hwan on "Global Entrepreneur said".

Gao Xiangqin believes that the impact of Korean pop culture is amore Pacific success in overseas markets,in part because of. "Han Feng is only the first stage of things, no Han Feng you will buy, but Han Feng brandwell-known open, more people will buy." Gao Xiangqin told the "Global Entrepreneur". "" you come from the stars "in the past one year, but why there are so many Chinese consumers are willing to buy our products,because it really meet the needs of the consumers."

Among them, the most eye-catching performance in the Chinese market brand innisfree. Since 2012 April opened the first store in Shanghai Wujiang Road, by the end of 2014, a total of Innisfree reached 108 inChina, equivalent to a monthly rate of not less than 3 stores of the speed of development. In 2014 alone,opened more than 60 stores. Compared to the group's two other early landing China brands Laneige andMamonde, Innisfree also created the most short profit cycle. In the 2014 annual report, Innisfree in the global market performance is particularly mentioned. Financial reports, with the opening of new stores andnew network marketing activities, Innisfree by a large number of young consumers. In 2014, the total sales of456700000000 won, compared with growth of 37% over the same period last year, operating profit growth of79%.

But in fact, success is second times to enter the market Chinese innisfree. As early as the end of 2004, thedepartment store in the form of Innisfree had first entered Chinese, but business less than two years tocompletely withdraw. At that time, it is the main natural skin care concept, but at the time the consumer perception of the brand is not strong, the attention is mainly focused on the Chanel, Dior, Lancome, Estee Lauder and other European and American brands. "Then China consumers, even in Europe and the United States first-line brand contact is not much more special, how can the evolution of herbs and natural toaccept foreign cosmetics?" Gao Xiangqin recalls.

Gao Xiangqin in this industry for many years. He was in 1997 to bring SK-II into the China market, and in 2004 joined the Estee Lauder, and participate in the origins Chinese market into the preparatory work. Theorigins of plant is positioned as high-end skin care brand, Gao Xiangqin had to Chinese market the concept of herbaceous plants skincare brand made a market research. At that time, only a few, China main naturalmarket foreign brands in addition to Innisfree, and Eve and L'Occitane luoxue. "In fact, at that time the brandInnisfree did is not bad, may yield can reach 150000 to 200000, however, the China consumers have nonatural plant skin care awareness, brand itself is still in the exploratory stage, so in the China after the discovery and expectations are not the same." Gao Xiangqin said.

Changed in 2012 to return to the market Chinese Innisfree channel of choice. Previously, Innisfree in high-end department store cosmetics counters, the price is relatively high, and L'Occitane squeezed Herboristsimilar brand. Now the Innisfree in street single brand stores as the main channel, the price is more close to the people. Although the Innisfree once be frustrated in China market, but in South Korea is constantly upgrading the product line, the concept of brand and small fresh style, it will be from Jeju Island to the extreme interpretation, has now become the leading domestic brands.

Gao Xiangqin found that when Chinese consumers increasingly mature, South Korea's single brand storesdevelopment model can be quickly copied in China. Rich product line also requires Innisfree by single store brand model. The general brand more than 300 SKU, while the green has more than 800 SKU, the cosmetics counters in department stores in dozens of square meters can not meet the demand for productdisplay. So, the streets hundreds of square meters of store brand has become the most ideal saleschannels.

At the same time, the main customer Innisfree group also echoes the brand brand shop mode. Innisfreetarget customer groups are relatively young, concentrated in the 20-30 years old, while those in the bustling commercial street shop is the gathering place of young people. "Purchase habits, they usually want to touch,see and smell, instead of the traditional department store counters, one on one counseling mode." Gao Xiangqin said.

Innisfree is likened to the "fast fashion cosmetics industry". It is somewhat like a clothing brand Zara and H&M, which are new products, update speed, high ratio of performance to price, shop area is large, the expansion of fast, easy self shopping environment. The present Chinese cosmetics market has more seriouspolarization, with local brands of dozens of yuan price as the representative of the domestic occupied the low-end market, while on the other side of the international major suit is the high-end positioning, price is in 200 yuan of above. Korean cosmetics brand is just to fill this gap in the market, the price range in 100-200 yuan, while the price is not high, it has a higher product quality and packaging.

In South Korea, amore Pacific also opened a named "ARITAUM" is similar to the Sephora cosmetics brandshop. "ARITAUM" means beautiful guest gathered beauty ", its sales performance and the total flow of people to Gao Juquan all South Korean top brand stores. Since 2008, opened its first store, the brand has expanded to 1300. Consumers can stop in here to buy a lot of brand amore group, including IOPE, Laneige,Mamonde, Bath, Happy, Lu Han law, Illi, Miseen, scene etc..

The more high-end positioning, HERA and AMORE PACIFIC snow show through department stores andduty-free sales channels. In addition, amore Pacific also opened up the "sale" sales model. Different from the direct sales, sales visit no downstream, the sales staff will visit the specified fixed area sales. The last century 80's, sales visit was the main mode of amore, it also like those known to direct sales cosmetics company, do not do too much brand marketing, but in the form of beauty and expand its influence. "At that time, we are Miss Korea (South) the biggest sponsor. Customers do not know much about the brand, but to our company

Research and development

South Korean cosmetics in the rapid growth of the global momentum depends on research and product development ability strong -- South Korean consumers love to speed up the development of the The new supersedes the old. "The South Korean consumer feedback is very fast, which makes the Korean skincarecycle particularly fast. Once the market did not sell well, all will be eliminated. We say that innovation, Korean consumers feel that not enough that we only innovation, re innovation, until they are satisfied." Amore Pacific Chinese Institute and director Yan Zaihao on "Global Entrepreneur said".

Yan Zaihao in 2001 from the South Korean headquarters to Shenyang branch, then began to studymedicine in China Medical University in 2009, and received a doctor's degree in medicine. Study of traditional Chinese medicine in order to more in-depth study of plant material, which can be better used incosmetics and health food. "We extracted compounds from plants, and then verify what is the benefit of theskin, whitening, anti wrinkle, moisture, such as. South Korea has its own unique Korean medicine, Chinamedicine more abundant." Yan Zaihao said.

Amore Pacific R & D center will study consumer behavior, skin beauty as the key differences between China and South Korea, consumers also consider them. "Korean consumers starting from the face makeupmakeup, finally, at least will use seven or eight kinds of products, but China basic three to four kinds of products is over, so the product development time, Chinese cosmetics will function together, while South Korea is more refined." Yan Zaihao explained.

In order to understand the vital needs of consumers, Xu Qingpei almost all product development company.His room filled with all kinds of cosmetics trial product, like a laboratory. Among them, he is most like shampoo brand Lv. At the same time, he will choose the group under the VB brand of oral care products, in order to help keep the best state.

He is very concerned about women's buying habits. "I grew up around five women, mother and four sisters,now married and gave birth to two daughters, with my wife, I and three women living together. Not only that, I have a pet dog named 'noisy', it is' female '. I chat to understand what women want, I hope consumers will love jasmine Pacific Group boss know me more than her husband." Xu Qingpei said.

In order to understand all this, as early as in 1954, had set up amore cosmetics research technology,become the first South Korean cosmetics industry enterprises to set up R & D center. Then, in 1973 the establishment of the Gyeonggi Suwon skin care business, 1990 to complete the construction of North Gyeongsang Kimcheon cosmetics business. In 2012 May, in order to put the two sales offices and 5 logistics center to integrate distributed throughout South Korea, Xu Qingpei completed the construction of beautifulmakeup Park (AMOREPACIFIC Beauty Campus).

In 1992 the construction of the museum is now the center of research and development of Chin's first building, research building, built in 2010 Yuan Mei Chi is a unique design of the building, the former focuses on the research of raw materials and other early, while the latter is committed to the development and application of the product. In order to make the R & D center into a creative space, Xu Qingpei invited Lizlaureate general Portuguese architect Alvaro Lou Siza as a designer.

The beauty of wisdom park not only has the open laboratory and office space, but also displays many works of art. Xu Qingpei love art, he said that if not engaged in the cosmetics industry, may be engaged in therelated work and art. When traveling abroad, he will always find time to go to museums and art galleries to visit. He believes that the cosmetics is a creation of beauty culture products, which also affected hismanagement philosophy.

The beauty of wisdom park exit hung two paintings, respectively is the portrait of Van Gogh and a lot of elderly people. These two pictures were handpicked by Xu Qingpei, he believes that South Korean artists painted Van Gogh overlooking the distant look is very delicate, a symbol of a vision of the future andcreative passion; and in another picture, an old man closed his eyes, forehead wrinkles are clear, which indicates that the hard work and effort. This is what Xu Qingpei wants to convey to all the R & D personnelinformation. The beauty of wisdom park next door is a museum, which displays the ancient Korean makeupappliances such as oil, hair dresser, blush, etc.. R & D Center Museum and art display by the professionalmanagement team of 12 people, the latter will display regular replacement.

Xu Qingpei hope that modern art can become a source of inspiration for R & D personnel. "I go out to have a look inside the Museum of art or something, think about how long ago people use make-up tools, it is helpful to innovation. I used to study chemistry, if only to study chemistry in the laboratory, innovation spaceis very narrow, and now are talking about cross." Yan Zaihao said.

In 2008, amore Pacific R & D center was born a revolutionary cross-border products -- the air cushion typeof cosmetics. Its design inspiration from the south parking tickets on the seal. The researchers observed that the South Korean parking tickets on the stamps are very clear, the ink will not smudge out, inspired bythe then, design a kind of "oil and water" sunscreen. The air cushion BB cream has the characteristics of low viscosity, can through the mesh sponge, packaged in a special sponge, stamp sunscreen a industry's firstborn.

It is not only the makeup and carrying is very convenient, but also to meet the higher requirements ofconsumers in efficiency. "Good cream moisturizing effect, but very heavy, emulsion products relatively thin,but not enough moisture and cover the effect is not good." Yan Zaihao told the "Global Entrepreneur". After painstaking research, amore Pacific R & D center that has 800000 holes is the most effective carrier liquidsponge products, the most stable. The sponge is designed into the vacuum cushion, so can effectively solve the liquidity of liquid, avoid the user hand smear liquid foundation trouble.

The development of air cushion products began in 2007, in 2008 March IOPE AIRCUSHION (Aino clear water Ying multifunctional air launched the cream to powder). This product is the first year sales of 3800000000 won, and achieved more than 200000000000 won sales performance in 2014, becoming one of the most popular Korean cosmetics market products.

Air cushion type products and even change the Korean women use makeup way, also is recognized as one of the key factors driving the trend of Korean cosmetics. The findings of a survey conducted by the globalsurvey firm TNS Korea, in the 800 South Korean female consumers surveyed, 75% of South Korean womenhave used or are using inflatable products, more than 80% people choose amore pacific.

Because it is easy to carry, can greatly reduce the time the user steps and make-up, and easy to shape thenatural flawless skin, in the global market, air products is thriving. As of 2015 February, amore Pacific Groupair products has more than 50000000 global cumulative sales. In 2013, air products in 2014 sales rose105% to 26000000, average every 1.2 seconds a amore Pacific Air Products sold. Especially in South Koreaoutside the region, including the largest overseas market for mainland China, Taiwan and Hongkong Special Administrative Region, air products sales rose as high as 140%.

In order to amore intensive and meticulous farming, Laneige's cushion BB cream also worked for theregional market and the development of the localization strategy, only in 2014, the product has sold close to1200000 in the Chinese. As of 2015 January, 13 brand amore Pacific's been to more than a dozen countries in Asia, North America, providing 19 kinds of air products.

Ambition

For a long time, to support the three core material amore Pacific Group business is green tea, ginseng,soybean. In South Korea, Jeju Island, amore Pacific Group has a wide road, west along, Hannan three separate tea. The temperature, humidity and soil are very suitable for planting Green Tea. Three tea plantations with a total area of 3300000 square meters, accounting for 25% of Korean green tea production,amore Pacific has thus become the only global cosmetics enterprises operating large-scale tea garden. It isStarbucks's South Korean supplier of green tea, also set up their own brands of green tea oh snow green(OSULLOC), and the creation of a number of oh snow green tea in the territory of the Republic of Korea(OSULLOC Tea House). The business also achieved success, the green tea ice cream has reached ten seconds to sell the alarming rate of cup.

This is quite different from amore Pacific early business extension mode, it found the core business is the"beauty and health", on the basis of health care products and other related areas covered. In South Korea,oral cosmetics market is growing rapidly, health drinks market has reached two digit growth, accounting for about 20% of market function of health food. In 2002, South Korea amore Pacific has launched the first oralcosmetics brand VB (Vital Beauty), the Super Collagen 2011 annual sales of more than 100000000000 won,in 2012 the number of more than 300000000000 won.

This trend also spread in the Greater China region. Korea Trade Promotion Corporation said that as more and more Chinese people because of air pollution and respiratory and skin diseases and so on health careconcern more and more is also high. In this regard, amore Pacific is also an occasion to launch the health care products, such as Laneige collagen drink first in 2013 October launched in Hongkong, currently hassales in the mainland market.

The new goal of the Xu Qingpei set for himself in 2020 to become the "first in Asia Pacific amore cosmetics company" and "outstanding global Brand Company", sales reached 12 one trillion won, including overseasmarket sales contribution rate of 50%, the profit contribution of 15%. "My father always told me to work hardto do, so as not to regret. I often said to myself, today is the last day to fight, to fight." Xu Qingpei told the "Global Entrepreneur". "

(original title: Korean manufacturer)

Editor: Wan Wan