Sephora has 3,000 stores worldwide — but Korea's Olive Young beat it in under five years

Sephora, the French cosmetics retailer owned by LVMH, is one of the world's biggest beauty chains, with more than 3,000 stores across 35 countries. In October 2019 it opened its first Korean store in Seoul's Gangnam district to long queues, planning to reach 14 shops by 2022. Korea looked like any other market to enter. It was not. In March 2024, after less than five years, Sephora announced it was withdrawing from Korea completely.

The problem was a rival that already owned the market: CJ Olive Young, the beauty-retail arm of CJ Group, commands almost 90 percent of Korea's cosmetics retail. Korean shoppers are fiercely loyal to the retail brands they know, and Olive Young already did everything Sephora promised — letting customers sample many brands in store and curating its own bestseller lists. Sephora's 'experiential' format, its global selling point, was not new in Korea.

The pandemic then knocked out the in-store experience Sephora relied on, and the losses mounted, from 12.4 billion won in 2020 to 17.6 billion won in 2022. Having planned 14 stores, Sephora never got close. In March 2024 it said it would wind down its online, app and physical presence from 6 May and leave the market by mid-August. It was not alone: Boots, the UK health-and-beauty chain brought in by Shinsegae, had also closed in Korea within five years. A global format had met a market that already had one.