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Sephora, a French personal care and beauty products company owned by LVMH Moët Hennessy Louis Vuitton, is withdrawing its business in South Korea. The company is set to leave the Korean market in May.
Failure to Topple Local Rivals
According to The Korea Times, Sephora is ending its operations in the region after incurring huge losses that have continued to grow since it entered the country in 2019. The company confirmed its decision to close its business on Wednesday, March 20.
Moreover, it was reported that Sephora's decision to shut down its business was mainly due to the fact that CJ Olive Young remained the dominant retailer in the domestic beauty market. In other words, Sephora failed to beat its local rivals and did not gain enough customers to sustain its operations in the country.
Business experts say the brand did not take off in Korea because it failed to understand what Korean customers want and need. In any case, Sephora is scheduled to shut its online mall, brick-and-mortar shops, and mobile app store on May 6.
The company posted a simple announcement about its impending closure: "Sephora heavy-heartedly decided to stop doing business in Korea. We are deeply grateful to our customers who have supported us."
Foray Into the Korean Beauty Space
Sephora is one of the leading beauty retailers in the world. LVMH brought the brand to Korea in October 2019 by opening the first store in Seoul's Gangnam district. It later built more stores in key areas of the territory, such as Yeouido, Jamsil, Myeongdong, Gwanggyo, and Sinchon.
However, The Korea Economic Daily reported that despite these expansion efforts to reach more customers, Sephora faced many difficulties aggravated by the COVID-19 pandemic. Ultimately, while its local competitors, like CJ Olive Young, thrived and grew, Sephora failed, leading to its closure in the region.
Photo by: Deva Darshan/Unsplash
