Korean wave: CJ Wellcare sets sights on US and Vietnamese beauty, probiotic supplement markets
CJ Wellcare is part of the CJ Group conglomerate which has business across food, entertainment, and functional ingredients sectors. It was formed last year as a health and wellness spin-off from CJ CheilJedang which is primarily in the food business.
Probiotic brand BYO and beauty-from-within brand innerb are the two major supplement portfolios from CJ Wellcare. Others include multivitamins and general wellness brand Dr. Nutri, weight loss brand Fatdown, ginseng beverage brand Hanppuri.
This year, CJ Wellcare is on track in growing its overseas presence, especially in the US and the Southeast Asian markets consisting of Vietnam, Thailand, Malaysia, and Indonesia, Victoria Cho, head of R&D at CJ Wellcare, told NutraIngredients-Asia.
In April, the company launched six of its BYOcore probiotics products and four of innerb products in the US online via Amazon.
BYOcore is the high-dose version of BYO probiotics. The products launched in the US are BYOcore 50 Billion Probiotics, BYOcore 10 Billion Probiotics, BYOcore 10 Billion Probiotics capsule, BYOcore Daily Probiotics, BYOcore Skin Immune Probiotics, and BYOcore Vaginal Probiotics.
One of the probiotic strains used is Lactobacillus plantarum CJLP133 – the firm's flagship probiotic strains isolated from Kimchi.
As for innerb, the products launched on Amazon are innerb Aqua Bank, innerb Aqua Rich Double Up, innerb Collactive Collagen, and innerb Snow White.
The innerb range contains collagen and hyaluronic acid as the main ingredients for moisturising the skin.
"Our ‘innerb’ product lineup features the ‘Collective Collagen’, a next-generation inner beauty material that is formulated with collagen and elastin in a ratio of 94:6, similar to the percentage of skin components," Cho added.
She said that the company has decided to introduce its supplements into the US at this point following the success of Korean dumplings and frozen pizzas sold by CJ Foods USA – the US food operations headquarters for CJ Cheiljedang.
“The CJ group has been heading towards the global market since three or five years ago. The food products, mandu (Korean dumplings) and frozen pizza are selling very well in the North America area.
“Thus, when we are searching for new market opportunities, the first one on our list is North America, because our mother company has launched the food products in the US market which are already well-received,” she said, adding that the US is the world’s largest dietary supplement market.
As for South East Asia, she explained that most of the markets in the region have adopted the Korean beauty standards due to Kpop.
“We want to launch our new product line more so in the Southeast Asia, especially Vietnam and Thailand because they want to resemble Koreans due to influences from the Korean wave.”
Over the years, the Korean wave has led to the popularity of Korean entertainment, Korean food, Korean cosmetics and skincare, and Cho believes supplements is next.
The beauty supplement innerb, for example, is already well-received in some of these countries.
“innerb Snow White is very famous in Vietnam and Thailand. Also, the Vietnamese already know about the Korean culture, Korean cosmetics and supplements, food, and they also want to use our K supplement.”
In Vietnam, the firm saw huge growth from the online sales channels, where sales were up 360 per cent between 2020 and 2021, while the increase in offline sales was three per cent.
However, the offline channels contributed a higher revenue at a 60 per cent as compared to the online channels.
Stiff competition back home
Aside from the external pull factors, another reason for CJ Wellcare’s aggressive overseas expansion is due to the stiff competition from the domestic market. In fact, Cho said the firm hoped to become the pioneer in introducing Korean supplements to international markets.
“The Korean supplement market has expanded greatly per year, it's about 20 per cent increase. However, the market competition is also very stiff, and we know that our main business is in the domestic market.
“At the same time, we also want to explore new opportunities, and be a pioneer in Southeast Asia, because our Korean culture and that of Southeast Asia is very similar.”
The South Korean supplement market has seeing consistent growth. Between 2021 and 2022, the country’s import of health supplements and functional ingredients went up 20 per cent.
Influence from Japan and the US
Cho believes that the company’s supplements have an edge over those already existing in the US market due to better taste and texture.
“Especially the collagen powder or protein powder, North America or American products taste too bitter or too sweet and the texture is not as good as the Japanese or Korean products,” she said.
She observed that Korean firms have been emulating the success of Japanese products in the past one to two decades, which has shaped the R&D behind Korean products.
Today, Korea-made products are taking inspiration from both the Japanese and the Americans, she said.
“We always wanted to resemble the Japanese supplements or some other fancy ingredients or fancy products. But as of now, we are following a mix of the US and Japanese market trends.
“The advantage of our products is that the taste is better than those from the American market, because we learn from the Japanese supplement market. Our products are therefore delicious, small, and fancy, just like the Japanese products and that is our advantage.”
Nonetheless, she pointed out that delivering the claimed health functions was first and foremost, the most important for dietary supplements.
Upcoming NPD pipeline
In the next two months, the firm hopes to launch its multivitamin gummies for immune and general health.
“We also have a pipeline to develop the next-gen, new functional ingredients from natural products.”
The goal is to submit scientific research information on these new ingredients to South Korea's Ministry of Food and Drug Safety (MFDS) to apply for specific health claims on its supplement products.
“We want to focus on the emerging markets, because there's so many opportunities to grow, including the beauty-from-within, kids health, and sports nutrition sectors.”