The Ultra-Cheap Beauty Shelf Belongs to Second Brands

What is the signal?

In a 17 September report, Seoul Economic Daily laid out how large retailers are moving into the sub-5,000-won cosmetics tier Daiso built, and how the same current is spreading to retailers in the UK and the US. On the 17th, E-Mart joined with Holika Holika, a brand of the cosmetics company Enprani, to release Solucian by Holika Holika, a five-item ultra-low-price skincare line. Earlier, E-Mart had also worked with LG Household & Health Care's Beyond brand on Glow:Up by Beyond, eight skincare items sold exclusively at 4,950 won each.

Convenience stores are pushing into the same tier. CU has expanded its beauty-focused stores to roughly 600 nationwide, and GS25 is strengthening 3,000-won flat-price cosmetics and small-size products. Daiso started an exclusive brand called Botanical Garden with Nature Republic in 2022, brought in VT Cosmetics' Reedle Shot the following year, and has since increased the number of beauty brands it carries.

One thing these cases share stands out. Both of E-Mart's lines take the form not of a company name but of a new line made with a specific brand belonging to that company, and Daiso's early cases were likewise exclusive brands. The ultra-low-price shelf is not a space that existing brands entered by cutting their prices; it is a space filled by names newly created for it.

The scope of this signal is worth stating plainly. The above consists of individual retailers' launch and expansion announcements and reporting that organizes them, not statistics showing the revenue or profitability of the ultra-low-price tier as a whole. How much any given line sold, and on what terms it came back to the manufacturer, is often undisclosed. What can be read here reaches only as far as the shape of the route in.

1. Rather than cut the price, they split the name

Enter an ultra-low-price shelf under an existing brand and the first thing to wobble is that brand's reference price. When products under the same name sit at 20,000-odd won in one place and under 5,000 won in another, customers come to remember the lower of the two as the brand's real value.

Splitting the name avoids that collision. Formats like Solucian by Holika Holika and Glow:Up by Beyond, which append the parent brand at the end, borrow manufacturing capability and trust while keeping the price baseline separate. The customer takes reassurance from a familiar name, and the brand protects the pricing of its main line.

So the first decision when starting an ultra-low-price review is not the formula but the name structure. Whether to go with an entirely new brand, to append a parent brand, or to participate only as the manufacturer behind a retailer's own brand changes the packaging, the labeling and the marketing responsibility that follow.

• How to separate the names of the main line and the ultra-low-price line
• Whether to expose the parent brand or handle manufacturing only
• Whether the two lines could meet in the same channel
• What impression remains on the main line once the ultra-low-price line ends

2. The planning moves to the retailer's side

In this structure, the side that decides to open a line is usually the retailer. The target price tier, the number of shelves and the launch date are fixed first, and the manufacturing or brand side designs a lineup to fit those conditions. That is the reverse of the usual order, in which a brand makes a product and then looks for a channel.

In this order the freedom to set specifications narrows, while uncertainty about volume and exposure narrows too. The difficulty is that with one side fixed, the other has to move. In a project where price and launch date are locked, what remains adjustable is volume, packaging, the items included, and how many SKUs to release.

So when an ultra-low-price collaboration is proposed, what to check is less the unit cost than the order of the conditions. Establishing what is already decided and what is still open avoids the later situation of cutting into the heart of the product just to reach a cost target.

3. 4,950 won is a result of composition, not of raw cost alone

E-Mart and LG Household & Health Care said that in making Glow:Up by Beyond they simplified the packaging and minimized marketing costs by using an AI model. In other words, the price was not reached by cutting the contents alone but by adding in what was removed from packaging and advertising.

Nor was the lineup narrowed. The line was introduced as including a toner, serum, cream, nasolabial-fold patch, eye ampoule, night mask cream, pack-to-foam and multi-balm, carrying firming ingredients such as collagen and bakuchiol and brightening ingredients such as glutathione. Instead of reducing the item count, it fits several routine steps into one line to complete a single shelf section.

The point to carry into planning sits here. When a target price is given first, having a list ready of what to reduce speeds up the discussion. Cartons and printing, container form, volume relative to bulk, shoots and models, and point-of-sale materials are each a different cost, and customers notice each to a different degree.

• Items never to be reduced in the formula itself
• Items that can be reduced in packaging and printing
• How many SKUs to place in one line to fill the shelf
• Whether any items overlap in routine step

4. The same structure repeats on UK shelves

In the UK, the low-price fashion retailer Primark sells Korean-made moisturizers, sheet masks and similar items through its own beauty brand, mostly at 0.75 to 5 pounds (about 1,400 to 9,000 won). On top of that, it has unveiled a K-Beauty Mini Mart in partnership with Pure Seoul, a specialist K-beauty distributor.

What deserves attention is what went into that mini mart. It was reported to gather second-brand products from Korean beauty companies such as Neopharm, Cellfusion C, Ingredient Editor and The Saem. The same method seen in Korean hypermarkets is being used as-is by an overseas low-price retailer.

For a brand, this means an ultra-low-price line need not end as a temporary domestic response. A second brand built for a Korean ultra-low-price shelf can become a candidate for an overseas low-price channel, or the two markets can be considered together from the start. In that case, however, labeling and ingredient standards have to be reviewed from the beginning against the country of sale.

5. What an ultra-low-price line leaves with the main brand

The greatest value of an ultra-low-price line is not revenue but contact. A product under 5,000 won sits at a price people pick up without deliberating, so it becomes the occasion on which a customer who did not know the brand tries it for the first time. That E-Mart has widened its assortment since its first ultra-low-price release can be read as a sign this contact worked.

The risk in the opposite direction comes from the same place. If the experience of using the ultra-low-price line is poor, that impression returns to the parent brand that lent its name. Splitting the name is a device for separating price baselines, not a device for blocking quality judgments.

So it is safer to write down in advance the standards the ultra-low-price line will not give up. Slip, fragrance strength and any sting are judged on first use and stay in reviews regardless of price tier. How far to reduce and what to hold is the real design work on this line.

The first question for the brief

Rather than beginning with 'we are reviewing an ultra-low-price line', try writing one sentence: in which channel and on which shelf, under what name, and with how many SKUs at once will we fill it? Then add one more line beneath it. When a customer who used this line looks at our main brand again, what sentence do we want to be left?