Watsons, the nation's largest health and cosmetics retailer, is introducing a South Korean cosmetics brand in Taiwan, with the first three outlets to be opened in the capital on Jan. 31.
"The Korean beauty retailer Missha mainly caters to young female customers aged between 15 and over 30. This characteristic will complement our original customer base of women aged from 18 to 39," Gordon Reid, managing director of Watsons Taiwan, told reporters yesterday.
Since its inception in 2000, Missha has quickly expanded into the largest cosmetics chain in South Korea, with 250 stores.
Taiwan will become the fifth foreign country to introduce the brand, after Australia, Singapore, Hong Kong and Mongolia. Next month, the US will see its first Missha store launched in New York.
"I expect that not long after the stores are opened in Taiwan, you'll see lots of people carrying bags that bear its flower logo on the street," Reid said.
In the initial stage, the beauty stores will be operated as independent outlets. Depending on the market response, Reid said they do not rule out any possibility in terms of store format in the future, which means Missha might be presented as store-in-store or franchise outlets.
One of the first three stores to be launched later this month is located in Taipei's Ximending district, which is popular among younger consumers. By the end of the year, the company expects to open 30 to 40 Missha stores nationwide.
Despite Watsons' optimism, its decision to introduce a foreign independent brand nevertheless raised doubts as to whether the market potential is strong enough, in view of British cosmetics brand Boots' shrinking market presence over the past few years.
After marching into Taiwan as a retailer in 2000, Boots suffered from lower-than-expected revenues because of its weak market positioning.
Expressing confidence in his management team in Taiwan, Reid said the team's strong marketing strategies and Watsons' successful operational experience would help develop the new brand and create demand.
The nation's beauty and health market could surpass NT$100 billion (US$3.15 billion) a year, since cosmetics and skincare products have contributed to NT$60 billion in sales at the end of last year, said Candy Yeh (
Similar to Watsons, which reported annual sales growth of 12 percent last year and expects to open 70 more stores in addition to its current 300 outlets by December, Cosmed also holds a bullish view about the market, Yeh said.