Suh Kyung-Bae, CEO of AmorePacific Group, Who Strengthens the 'K-Beauty' Global Strategy
Suh Kyung-Bae, CEO of AmorePacific Group, Who Strengthens the 'K-Beauty' Global Strategy
  • Lee Ho-Young, Staff Reporter
  • 승인 2018.06.17 22:16
  • 수정 2018.06.18 09:05
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Suh Kyung-Bae, CEO of AmorePacific Group
Suh Kyung-Bae, CEO of AmorePacific Group

The worldwide cosmetics industry is watching Suh Kyung-Bae, CEO of AmorePacific Group.

Mr. Suh who has been conducting overseas strategies focusing on China has recently begun to expand its territory rapidly all over the world including Singapore, Australia, USA and Japan.

It is understood that AmorePacific is rechecking the Chinese market. Due to the controversy over THAAD deployment from the early last year, interest of Chinese consumers in Korean cosmetic products decreased drastically, but with the recent recovery of the Korea-China relationship, AmorePacific has been preparing a strategy to approach Chinese consumers again.

Most of all, while reducing the number of Mamonde and Laneige shops in department stores, AmorePacific is increasing that of premium brands Sulwhasoo, Hera, Innisfree and Etude. 

It is to increase the efficiency by removing local shops that are not highly profitable and considered inappropriate for the brand concept.

Furthermore, Mr. Suh is strengthening an approach to other overseas countries. Hera opened a separate shop in Takashiyama Department Store, the first step in Singapore.

AmorePacific plans to make Singapore a bridgehead for advancing to the Southeast Asian market. In March, Innisfree signalled an entrance to Japan by opening a shop in Tokyo, and Laneige entered Australia through Sephora. Etude House opened its shop in Kuwait in February and Dubai in March, starting the strategy to advance to the Middle Eastern market.
  
Recently as the South and North Korean relation is improving, it is additionally seeking advance to Eurasia such as Russia. Mr. Suh recently explained to the staff "If South and North Korea is connected, we can go via Cheongjin to not only Vladivostok but also passing through Siberian woods, Lake Baikal and Ural Mountains to Moscow, further to Berlin by train. Thus, we can call the Yongsan station the 'Station of the Continent'".

Mr. Suh emphasized "many lands of opportunity such as Russia, East Europe, India, Saudi Arabia, Dubai and Turkey are waiting for us" and "Population who wear makeup and purchase cosmetics products are continuously increasing, and K-Beauty and Asian beauty will impress the Eurasian Continent".

◆ Merits of management activities

Mr. Suh Kyung-Bae, CEO of AmorePacific Group, succeeded the cosmetics business from the late Mr. Suh Sung-whan, the founder of Taepyeongyang (meaning Pacific ocean), and has grown it to a global cosmetics brand, AmorePacific.

He is known to be a passionate CEO who monitors products meticulously, and goes on trips himself to make a deal.

Since last year, he has been opening shops in Paris and New York to make a full fledged entrance to European and US markets beyond Asia.

In September 2017, AmorePacific opened a Sulwhasoo separate shop in Galeries Lafayette, the largest department franchise in France, and also launched a shop in its online mall. In March 2018, the first shop of Etude House was opened in Dubai of United Arab Emirates.

He has been so far endeavoring to dominate Asian markets such as China and Southeast Asia, but planned to expand new shops in the Middle East.

However, it is not that he has been having only success. He said in an interview with a US press CNBS "A big lesson gained from the business failure in France was that we have to first understand what the consumers want when we enter a new country" and added "Unlike then, French consumers are interested in K-Beauty now".

Mr. Suh said "The US market is the hardest to penetrate into," but "We will make the US our fourth core market following Korea, China and Asian markets".

In March 2018, AmorePacific launched its representative brand 'Mamonde' in 200 shops of 'Ulta', a US cosmetics specialist retailer.

Before entering the US, AmorePacific had selected 27 items consisting of 21 skin care products and 6 color cosmetics products through local consumer analysis and preliminary product tests.

As Ulta is the fastest growing cosmetics distribution channel in the North American market, it is expected to help AmorePacific entering the US market.

AmorePacific also entered the Australian market. In March 2018, the 'Laneige' brand was launched in the global cosmetics retail shop 'Sephora' in Australian major cities such as Sydney, Melbourne and Brisbane.

Mr. Suh said "With Laneige as the beginning, we plan to introduce various brands containing AmorePacific's uniqueness to Australian consumers', and "We will continue to explore new global markets including Australia to accelerate our voyage to a Great Brand Company".
 

◆ Who is Mr. Suh Kyoung-Bae, CEO of AmorePacific Group?

As a CEO of a cosmetics company, Mr. Suh is famous for using his company's products himself before launching to the market. He said "I think it is the most important that I have to be satisfied with our products myself".

The key that promoted AmorePacific from only a mid-sized company in the 1997 currency crisis to a global enterprise is known to be the 20 year 'cosmetics focused management' strategy implemented by Mr. Suh. 

He is known as a 'CEO who studies hard with never putting his hands off books' to people around him. He calls the author of a book to discuss the contents, and often recommends a book to his staff and employees.

He has his own firm opinion that the manager should not stop learning during lifetime. They say he incorporates ideas obtained from reading and fields into management.

He is called 'Mr. Suh Kyooung-Bae' rather than 'Mr. Chairman'. Since 2002 when he was the CEO of Taepyeongyang, he has set to be called 'Mr.'.

He values communications with employees. He holds a morning meeting with his employees at the company auditorium at 8:30 on the first day of every month. This is a tradition that the late Seo Sung-Whan, the company's founder, started in 1945. It is understood that he listens to employees, and talks about his thoughts over his overseas business trips.

◆ Quotations from CEO Suh Kyung-Bae

"We have usually seen customers as buyers, but things have changed now. Customer no longer exists as one who only buys things. We could say before 'I buy things, so I exist', but now the words 'I use things, so I exist', and 'I experience things, so I exist' are more appropriate to indicate the customer. Communications between the company and customers are important, but communications among customers regarded as more important now. It is no exaggeration to say that it is more meaningful to receive customers' good reviews than to be awarded the grand prize at the Cannes International Advertising Festival." (At an AmorePacific regular morning meeting on April 2018)

"We created our values of openness, honesty, innovation, intimacy and challenge. I would like to create a high-level commitment organization based on these values. A good company can go with a hungry attitude, but a great company cannot be reached without values. So, we made our values. In order for both the company and its members to grow steadily, we should focus on pursuing values more than just doing hard work." (Emphasizing company values to AmorePacific employees on March 2018)

"Let's open the third Yongsan era at our new head office here with a noble vision for the Great Brand Company." (From New Year's address on January 2, 2018)
 
"Based on continuous research and development, I will make efforts to contribute to the development of the local economy while enhancing the competitiveness of the domestic cosmetics industry." (On March 14, 2017, signing a memorandum of understanding to invest in the Yongin Beauty Industrial Complex in presence of Nam Kyung-pil, Governor of Gyeonggi Province, and Jung Chan-min, Yongin Mayor, with the aim of creating the 'Beauty Industrial Complex' including research and complex facilities in Bora-dong, Giheung-gu, Yongin-si)

"Let's make a strong move toward achieving a grand corporate vision based on 'a roly poly sprit' and 'DNA of Innovation' that we have always created as new opportunities for changing the world undaunted by any predicament."

"Beyond the 'quantity era' where the product was sold when it was only made well and the 'quality era' where the product was sold if it had an advanced technology, we are now standing at the inflection point entering the 'era of class' when only the 'luxury product' containing the unique sensibility that moves people's hearts are sold."

"We should go forward into a beauty company that shows decent values of 'Only One', not just a No.1 in the world, with our own Asian Beauty" (At the 2017 New Year ceremony on January 2, 2017)

"I will find creative young scientists and support them in the long run so that the world's best research results can come out. I will create an environment where young scientists can immerse themselves in challenging research with infinite dreams. I have vowed that I would return to our society the generous attention and love that I have received until I succeeded. I thought I should spend my hard-earned money in a good way. I will support Korean scientists even if it takes 20 or 30 years for them to receive the Nobel Prize in Science." (At the 'Suh Kyung-Bae Science Foundation' media conference on September 1, 2016)

"Now, the paradigm of the world is gradually changing to the era of Asia, and it is the definite high time for us to firmly establish the company as one that 'creates the beauty of Asia' and 'represents Asia's values'. Let's continue the modest challenge with a steady step as we are standing at a crucial crossroads heading toward 'a Great Brand Company'. Building up the power of five global champion brands, Sulwhasoo, Laneige, Mamonde, Etude, and Innisfree, I will cultivate a 'one trillion brand'. Besides emerging markets such as China, I will also actively enter the developed markets and let the world know the 'Beauty of Asia'." (From AmorePacific Group New Year's address on January 4, 2014)

해외 전략을 확대하고 있는 아모레퍼시픽 서경배 회장 [연합뉴스]
해외 전략을 확대하고 있는 아모레퍼시픽 서경배 회장 [연합뉴스]

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