Motohiro Kato: Championing K-beauty Trends in Japan

The MZ generation in Japan is captivated by K-pop and K-beauty, fuelling a growing trend for Korean cosmetics. The rising demand has also increased the number of stores specializing in these products, one of which is 'Olympia,' a variety shop operating 80 outlets across the country.

Olympia has made a mark by introducing a variety of Korean cosmetic brands to its customers, helping them navigate the exciting world of K-beauty. A significant player behind Olympia's success is its subsidiary, Keisetsusha, which imports Korean cosmetics and supplies them to Olympia. At the helm of Keisetsusha is CEO Motohiro Kato, the older brother of the Olympia Group's chairman, Michihiro Kato.

Motohiro Kato recently attended the '2023 Cosmo Beauty Seoul' expo, scouring various booths for products that would appeal to the Japanese market. Let's delve into Kato's insight on the interest in Korean cosmetics in Japan and his thoughts on how to enter the market.

Keisetsusha: The Key Role Player in the Olympia Group

Headquartered in Nagoya, Japan, Keisetsusha, an affiliate of the Olympia Group, is tasked with the crucial role of sourcing and developing domestic and international products. Over half of the items sold in Olympia's outlets are supplied through Keisetsusha, making it a vital cog in the Olympia machinery.

Olympia operates 80 stores nationwide, with its inventory mainly comprising stationery, novelty goods, cosmetics, accessories, and food. Cosmetics alone account for just over 10% of their offerings. With plans to add 30 more stores, Olympia aims to cater to its primary audience of young MZ consumers in their teens and 20s, who have an affinity for cute and appealing products.

Motohiro Kato's Pursuit of New Korean Brands

Kato's recent visit to Korea aimed to discover unique Korean brands. While big names like Amore, LG Household & Health Care, and Mediheal have previously dominated the market, new brands with innovative concepts are steadily growing. Kato is eager to bring these fresh brands to Japan.

Olympia's journey with Korean products began in the early 2000s when the potential of these products was discovered in the stationery business. Since then, Kato has visited Korea more than 100 times, seeking to enrich his understanding of Korean cosmetics and accessories.

Korean Cosmetics in Olympia: The Blend of Well-known and Indie Brands

Olympia's inventory includes several Korean cosmetic brands, such as the popular Mediheal, and is gradually expanding its collection to various indie brands like 'Rose Project.' While well-known brands can attract customers effortlessly, they also face fierce price competition. Meanwhile, newer brands require more investment of time and effort, but once they secure a fanbase, they significantly contribute to profits.

Japanese customers find the packaging and design of Korean cosmetics exceptionally appealing. Each brand's distinct color and shape successfully grab attention. The Korean products are perceived as fast and robust by Japanese consumers.

The Growing Demand for Korean Cosmetics

Kato acknowledges and appreciates the charm and quality of Korean cosmetics, aiming to introduce them to Japanese consumers while maintaining partnerships with Korean cosmetic brands. He highlights the success of the 'K Beauty Festa,' a promotional event held in Kawasaki that showcased 20 brands in collaboration with BGT Company, a Korean partner.

This event attracted a large number of famous influencers from Korea and Japan, which significantly boosted customer interest. Seeing the event's success, there are plans to host additional events in Osaka and Nagoya within the year.

The Future of Cosmetic Distribution in Japan

In Japan, offline channels still hold considerable sway, with customers inclined to see and purchase products in stores. Hence, developing offline distribution remains crucial. Channels like variety shops, drug stores, general stores, convenience stores, and discount stores are pivotal, and securing them through Japanese vendors requires close communication.

Although K-beauty enjoys popularity as a unique niche, it has yet to permeate Japan's mainstream market. Kato believes in understanding Japan's unique preferences and lifestyle, stating, "Japan lives according to the manual. The process of K-beauty entering Japan is largely manual." If these principles are well-followed, Korean brands can secure a significant advantage over competitors.