Ulta Beauty’s strategic investment in Korean beauty, commonly known as K-beauty, is yielding significant returns. During an earnings call on October 26, 2023, CEO Kecia Steelman reported that the company’s K-beauty offerings are not only boosting sales but also attracting a new customer base.
The retailer has formed exclusive partnerships with notable K-beauty brands, including Medicube and Peach & Lily, enhancing its product portfolio. Steelman emphasized that the K-beauty assortment is “resonating and driving skincare sales,” highlighting the brand’s focus on both skincare and makeup trends.
In her remarks, Steelman noted, “We saw space for growing K-beauty trends in both skincare and makeup.” She revealed plans to expand the K-beauty lineup with several new brands throughout 2025, such as TIRTIR, Fwee, and Unleashia. This move positions Ulta Beauty as the sole U.S. retailer for Medicube, a beauty-tech company known for its celebrity endorsements, including promotions by Kylie Jenner and Hailey Bieber.
K-beauty products are gaining traction in the United States, attributed partly to their affordability and innovative designs. For instance, the pimple-patch brand Starface has captured attention with its whimsical, star-shaped patches, which have benefited from viral social media trends. Steelman remarked that these brands are effectively appealing to “the next generation” of customers.
In its most recent financial results, Ulta Beauty reported third-quarter net sales of $2.9 billion, marking a 12.9% increase compared to the same period last year. Same-store sales rose by 6.3% year-on-year, reflecting strong consumer interest and engagement. Following the earnings announcement, the company’s stock price saw a nearly 6% increase in after-hours trading, contributing to a total rise of approximately 33% over the past year.
The growing popularity of K-beauty in the U.S. is evidenced by recent data from marketing research firm NielsenIQ, which indicated that the K-beauty industry reached a valuation of $2 billion in the year leading up to July 2023, representing a 37% increase from the previous year.
Industry analysts have noted that the appeal of K-beauty lies in its quality and affordability. According to Anna Keller, a principal analyst at Mintel, K-beauty products offer high-quality, effective solutions without excessive costs. This affordability positions K-beauty brands as attractive options for consumers looking for value.
As competition intensifies, major beauty retailers like Ulta Beauty and Sephora are vying for exclusive sales agreements with K-beauty brands. This urgency is particularly pronounced ahead of the anticipated U.S. debut of Olive Young, a leading South Korean beauty retailer, next year.
Ulta Beauty’s proactive approach to K-beauty illustrates a significant trend in the beauty industry, as retailers adapt to changing consumer preferences and capitalize on the growing demand for innovative and affordable skincare solutions.