K-beauty vegan rebel Dear Dahlia in Paris' Galeries Lafayette

South Korean cosmetics brand Dear Dahlia successfully opened a boutique in Europe’s largest department store in 2019 – just two years after the launch of the brand.

After opening a store at Galeries Lafayette in Paris, the brand also became available through the US luxury department store chain Neiman Marcus in the same year. 

As of November 2021, the brand can also be found at Mitsukoshi Ginza, a high-end department store in Tokyo, Japan. 

The next markets for the K-beauty brand are Southeast Asia, Australia, and India. 

Dear Dahlia hopes to quadruple the number of stores located worldwide from the current 200 to 800 within this year; and to grow to more than 1,000 in the next. 

The brand posted 31.6 billion won ($27 million) in revenue last year with that figure projected to reach 50 billion won this year. Its target revenue for 2023 stands at 150 billion won. 

Baram International Co., which operates Dear Dahlia, began as a cosmetics distributor in 2014. 

The company's CEO Park Rae-hyeon previously worked in the overseas sales department at Samyang Corp. and wanted to build upon the experience with her own company. 

In the early stages, Baram International did distribution and marketing for small to mid-sized South Korean cosmetic manufacturers that export to Southeast Asia. 

Products offered by these manufacturers were mostly lower-end cosmetics, with performances heavily swayed by market fluctuations. 

“I came to the conclusion that our chances of winning were slim if we could not build a strong brand on our own and only focused on products that sell well at the moment,” said Park. “The starting point for Dear Dahlia was the decision to make a high-end global beauty brand, the value of which increases over time.” 

VEGANIZE TO SPECIALIZE

Adding to the know-how accumulated from the years of marketing and distribution, Park carefully studied the global luxury beauty industry.

Based on her research, she chose veganism as the keyword to differentiate the brand. 

Back in 2017, vegan cosmetics were rare in South Korea but Park believed in the vegan industry's potential for growth.

“At the time of the development, none of the cosmetics original design manufacturers (ODMs) had formulas that meet the qualifications for the vegan label so we had to go through a separate R&D procedure,” Park recalled. 

The entrepreneur expressed gratitude for the ODM partners by saying, “Innovative products would not have seen the light of the day without the researchers at ODM facilities that worked with us despite being such a nascent company.” 

The company’s focus on digital marketing was key to its success. 

With the global market in mind, the company featured models of various ethnicities in online marketing campaigns. It created images and videos optimized for social media platforms as opposed to traditional media outlets such as TV. 

At the time of writing, Dear Dahlia boasts more than 521,000 followers on Instagram. To put that number into perspective, HERA by K-beauty juggernaut Amorepacific Corp. has about 316,000 followers and VDL by LG Household & Health Care has some 120,000 followers. 

According to Park, more than 95% of its followers on Instagram are not Koreans. She explained that gaining popularity on social media served as the foundation for entering luxury department stores worldwide. 

Park is the majority shareholder of Baram International with a 52.9% stake. Amorepacific has a 9.3% stake, followed by Smilegate Investment with a 7.2% stake.

The startup recently raised 16.5 billion won from QUAD Investment Management, LB Investment and more in Series B funding. 

Baram’s accumulated funding from 10 investors amounts to 42.5 billion won. 

Write to Sul-Li Jun at sljun@hankyung.com
Jee Abbey Lee edited this article.