From Laneige BB cushion compact to Sulwhasoo ginseng cream, Innisfree green tea seed serum and Etude’s candy-coloured cosmetics, one man has tried them all.
Mr Suh Kyung Bae, chairman and chief executive of South Korea’s largest beauty empire AmorePacific, is so dedicated to his family business that he applies the products on himself before they are launched.
That is more than 30 brands and thousands of products, ranging from skincare and cosmetics to shampoo, but that hardly deters the 52-year-old, who took over the reins from his late father in 1997.
“I try all the products before they are launched. The most important thing that I consider when launching a new product is whether I can be responsible for it,” Mr Suh told The Straits Times in an e-mail interview. “And to understand our target audience – women – I not only talk with my wife and my daughters, but also listen to our women employees’ discussions.”
Founded in 1945, AmorePacific had its humble beginnings in the kitchen of Mr Suh’s grandmother, who made camellia oil to sell to trendy women who used it to style their hair.
Seven decades on, riding on the overwhelming popularity of K-pop and K-beauty at home and overseas, the company has become the 14th-largest cosmetics maker in the world by sales, with record total revenue of 4.7 trillion won (S$5.7 billion) last year. Global sales made up about 18 per cent of this figure.
Its top five brands, including the mid-range Laneige and premium line Sulwhasoo, have more than 4,000 stores in total worldwide, from Asia to Europe and the United States, including in Singapore.
Many of the company’s brands are fronted by the biggest South Korean names in showbusiness, such as popular actress Song Hye Kyo for Laneige, and A-list actor Lee Min Ho and Im Yoona of girl band Girls Generation for Innisfree.
While the celebrity link and the rise of the Korean Wave have helped AmorePacific’s brands gain initial recognition in the global market, Mr Suh said growth is “based much more on our product quality and the global trust that we have strived to earn over the years”.
He places high emphasis on Singapore, which he said is a market with huge growth opportunities and serves as a “significant hub” in South-east Asia.
The company’s success has made Mr Suh the second-richest man in South Korea, with an estimated net worth of US$10 billion (S$13.5 billion) as of last month, according to Forbes. First on the list is Samsung Electronics chairman Lee Kun Hee.
When asked about his ranking, Mr Suh was quick to downplay his wealth. He owns 56 per cent of the holding company AmorePacific Group and 11 per cent of AmorePacific Corp, the cosmetics arm. Instead, he said: “The valuation of our stocks means that more people are appreciating AmorePacific’s vision and our pursuit of Asian beauty.”
It was not always smooth sailing for AmorePacific, though.
In the 1990s, the company was rocked by financial difficulties after trying to expand and diversify like other conglomerates.
“We thought about what we would do again if we started from the beginning, and what we could do best. And the answer was cosmetics,” said Mr Suh, who joined the firm in 1987 after obtaining his MBA from Cornell University.
So, AmorePacific went back to its core trade, selling off divisions that were not related to beauty and focusing on creating new beauty products, like the country’s first ginseng cream and first green tea-based skincare range.
Its latest hit is the Cushion compact, which applies the concept of a stamp pad to BB cream – an all-in-one beauty cream – to make it easier to use. Last year alone, it sold a staggering 26 million pieces, or 49 per minute.
AmorePacific also tailors products to local needs – a strategy that was born out of a lesson learnt, said Mr Suh. He recalled how the company failed to break into the French market in 1988 as it had “limited understanding of the market environment”.
So, when it entered China in 1992, after the two North-east Asian neighbours established formal diplomatic relations that year, Mr Suh said AmorePacific spent the next 10 years studying the Chinese market and consumer behaviour.
“We even visited people’s homes to observe their skincare and make-up habits and, based on these studies, we launched Laneige in 2002. For another 10 years, we focused on widening the brand portfolio to serve the local customers’ needs. The success we see today in China was only possible through these efforts that spanned two decades.”
Sales in China have been growing year-on-year, reaching 467.3 billion won last year, more than half the company’s foreign revenue.
In the eyes of his employees, Mr Suh is a boss who cares about his staff and leads by example.
Ms Katherine Sek, commercial general manager of AmorePacific Singapore, recalled how he personally led a group of more than 1,000 employees from all over the world to climb the well-known Mount Halla in Jeju Island in April. “It was very memorable,” she said.
An affable man, Mr Suh is married to the youngest daughter of Mr Shin Choon Ho, chairman of food giant Nongshim Group.
The couple have two daughters, aged 19 and 23.
Although there is no collaboration between the two chaebol, or family-controlled conglomerates, Mr Suh has spoken about how his father-in-law, like him, is so devoted to the family business that he tries all of its products, from instant noodles to snacks.
When asked if he is already grooming his children for succession so he can have an early retirement, Mr Suh said: “My two daughters are still in school and it is too early to discuss their involvement in the company. Moreover, I am still young and have much to do.”
This story was first published in The Straits Times on July 6, 2015.
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- Amore Pacific
- AmorePacific Corp
- AmorePacific Singapore
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- commercial general manager
- Cornell University
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- Etude House
- food giant
- Girls Generation for Innisfree
- girls' generation
- green tea
- Green Tea seed
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- jeju island
- korean beauty
- korean idol
- Korean star
- Lee Kun Hee
- Lee Min-Ho
- Mount Halla
- Nongshim group
- popular actress
- Samsung Electronics
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- water sleeping mask