Who Will Win the K-Beauty Wars?

Hi, and welcome back to Full Coverage, your favourite beauty newsletter.

Thanks to all of you who are sending me weekly messages and updates, it keeps me pumped. I had planned to write a bit more about M&A after so many of you had questions about my picks. But then Sephora and Olive Young decided to drop some major collaboration news (Brennan on our team had the scoop) and I decided to save those M&A questions for next week.

Besides, this week I wanted to talk about power partnerships, and product.

In this edition, you’ll find:

• My take on Sephora’s newly inked deal with Korea’s Olive Young
• My thoughts on the increasing number of new product reformulations

One Beauty Battle After Another

You may have seen the news that The Business of Beauty broke this week about Olive Young’s new partnership with Sephora. For those that missed it, a quick primer: The South Korean beauty giant is bringing a curation of its best and brightest brands to 700 Sephora doors worldwide.

This is — no pun intended — a huge deal.

Though Olive Young is launching in the US in May with its own set of Los Angeles stores, the retailer will have to contend with the challenge of adapting to not only a new market, but a new shopper. It’s smart for the K-retailer to take a one-two punch approach by launching its own doors and finding the best partner it could in the US. What’s more, the Sephora deal is only going to make Olive Young that much more enticing by introducing US shoppers to the retailer and then driving those same shoppers to their LA stores.

The upside for Sephora is also great. Sephora’s merchandising team, led by another fantastic Priya — Priya Venkatesh — has been on a tear trying to globalise what it does best in the US: building brands and driving traffic. By partnering with Olive Young, Sephora gets to stand by its K-Beauty assortment with conviction, something it hasn’t been able to do fully with its small assortment now. (It currently carries 12 K-beauty brands, five of which were onboarded in the last year.)

I don’t say this often, but although Sephora is known to be a first-mover in most cases, it is playing a bit of catchup here. For the last year, Ulta Beauty has been building out its own K-beauty assortment with best-in-class South Korean brands, via direct brand partnerships, distributors like Hansung and Landing International and consulting agencies such as Breakthru Beauty. While Sephora has Beauty of Joseon, known for its cult sunscreen, and a strong stable of Amorepacific brands in its repertoire, Ulta landed viral favourites Anua, Tirtir and Medicube. Its aggressiveness at securing brands has quickly become an advantage. And because of Ulta’s sheer square footage, customers easily know what Ulta skincare stands for in store… K-beauty.

Now, Olive Young is known for its gamified shopping experience and product focus, literally ranking its best-sellers, revving up customers as well as competitive brands. This too can be an advantage for Sephora. While most of Sephora’s early contracts are about two years for young brands, it hasn’t nailed the ability to bring products in and out with ease. (This is also a win for South Korean brands who get to test Sephora’s waters before making a full-on commitment.) Via Olive Young, hopefully it can, and also get the kind of traffic it needs to be successful.

Both Sephora and Ulta Beauty are taking great care as to who to align themselves with globally (Olive Young in Korea, Tira in India, Chalhoub Group in the Middle East and Kohl’s in the US for Sephora, and Grupo Axo in Mexico, Space NK in the UK and Alshaya Group in the Middle East for Ulta) in a never-ending contest at world beauty domination.

Now each of these deals are structured differently, and some are client-facing and others are more about infrastructure. For instance, Kohl’s merchants have very little contact with Sephora brands, and Chalhoub has its own beauty retailer, Faces, alongside its joint venture with Sephora. But as with all of these partnerships, there is always a question around who owns the brand relationship.

Will Olive Young own its relationships or will Sephora? My guess is it will be Olive Young as Sephora will be onboarding its own K-beauty brands separately. Could an Ulta exclusive be null and void if Olive Young wants to bring a brand to Sephora? That I don’t know, but we’re about to find out.

What’s Behind These New Product Reformulations?

Just as I was sending out Full Coverage last week, I got notice that Estée Lauder was reformulating Double Wear Stay in Place foundation, its 28-year-old, hit complexion product that tops all the charts, according to Yipit data. Lauder follows Armani, which recently rejiggered its own hero foundation, Luminous Silk, promising an even lighter, silkier finish with an expansive shade range, and Chantecaille Future Skin.

Justin Boxford, Estée Lauder’s global brand president, told WWD, “Consumer needs in the last few years have evolved, and technology has advanced tremendously.” The new Double Wear, which launches next month, reportedly had been in the midst of a reformulation for more than five years. The new Double Wear is considered a “modern matte.”

Boxford is not wrong, technology has evolved; it’s partially why indie brand Makeup by Mario reintroduced a new foundation late last year after releasing his first three years prior. The way customers also wear foundation is different. Many are still opting for a lighter, skin tint look or stretching concealer across their faces for less coverage.

Appealing to younger and newer customers is one thing, but so is getting ahead of future regulations. Since 2024, the European Union has banned certain silicones, such cyclopentasiloxane, in cosmetic products, which add slip and smooth skin finishes. Leave-on items like foundation needed to be reformulated by mid-2027; Chantecaille was one of the first big brands to get on board. While Armani and Estée Lauder didn’t advertise this change in these recent reformulations, the ingredient has disappeared from their INCI lists.

Alex Padgett, a cosmetic chemist and co-founder of skincare line Educated Mess, said cyclopentasiloxane is “phenomenal in foundations and sunscreens” because of its quick dry-down and powdery after-touch.

Brands can’t simply just swap one ingredient in for another. Usually around 15 percent of a formula changes when a product must be reformulated, said Padgett, so it will be up to customers to decide if these new versions live up to their older expectations.

What I’m Reading

Botanical-heavy, reef-safe and sun-proof formulas have come to define the “A-Beauty” wave, as Aussie brands like Uni and Rationale go global. [Financial Times]

Silicon Valley’s billion dollar question: How much would you pay for a good night’s sleep? [San Francisco Standard]

“Fluid fit” clothing, tightening serums and a “regenerative” injectables boom are just some of the ways that GLP-1 usage continues to infiltrate wider culture. [The Business of Beauty]

And Novo Nordisk wants Ozempic leading the charge. Its new ad, “Only One Ozempic,” reunites Justin Long and John Hodgman to riff on their early-aughts “Get a Mac” campaign. [The Wall Street Journal]

The entrepreneur behind Sweet Honey Farm, a 20-acre wellness centre slash farm, does his one-to-ones in the Sauna. [The New York Times]

Thanks everyone!

Priya

Want to dive deeper into an insight from this article? Check out The Brain of Fashion, BoF’s new generative AI tool where you can unlock BoF’s beauty archive with a single question.