The "K-Wave" economy: How Korean beauty exports are reshaping U.S. retail

The “K-Wave” economy: How Korean beauty exports are reshaping U.S. retail

South Korea’s cultural capital is at an all-time high, with properties like “K-pop Demon Hunters” dominating streaming charts for movie and music categories alike.

This trend is evident to pop culture-obsessed consumers, but there’s an economic side to the story that's relevant to businesses in the U.S.

Specifically, South Korea’s rise as a cosmetics powerhouse is becoming clear, with exports surpassing those of many of its international competitors.

Incellderm provides an overview of the “K-Wave” economy to illustrate the extent of its influence, and what this means for North American retailers in particular.

Increasing Cosmetic Dominance

Data from the International Trade Council shows exactly how impressive South Korea’s rise to prominence in the global cosmetics sector has been in the past couple of years.

In Q1 of 2025 alone, its exports for this category of goods hit $3.61 billion. That represents a 20.3% year-on-year uptick.

By comparison, the U.S. exported cosmetics worth $3.57 billion between January and April. The YoY growth rate of 1.1% looks a lot more like stagnation than expansion.

South Korea remained behind France, the world’s incumbent leader in cosmetics exports, in Q1. However, the rise in French exports of 6.3% YoY implies that it’s entirely possible South Korea might overtake it in the not-too-distant future. It all depends on whether the current trend continues.

The subsequent quarters have been similarly robust, signalling that South Korea is on track for another record year for cosmetics exports. The Korea Customs Service confirmed that Q3 exports were up 17.6% YoY and that year-to-date international sales now sat at $8.52 billion, with one final quarter to go.

America’s South Korean Cosmetics Infatuation

In addition to indicating that South Korea is now a bigger exporter of cosmetics than the U.S., another revelation from official data is that America is the country most responsible for its ongoing rise to expected dominance.

19.7% of all cosmetics exported from South Korea reached the American retail market in Q3 of 2025. That’s ahead of the 18.5% slice accounted for by China in second place, and Japan’s more modest 9.7% stake.

Brands like Incellderm ICD Skincare have found favor with consumers in the U.S. for a number of reasons. Industry insiders claim that innovation in product design and marketing is the primary catalyst behind this trend. However, South Korea’s burgeoning pop culture clout is perhaps even more of a factor.

In the past decade, K-pop bands like BTS and Blackpink have broken through in the West. More recently, the aforementioned release of “K-pop Demon Hunters” has raised the profile of the nation’s music and movie output even further. Within weeks of its release, it had been viewed 236 million times, outranking any other Netflix project to date.

So, while in past decades it was America’s pop culture that dictated retail trends around the globe, we’re now seeing South Korea emerge as a new powerhouse in this regard.

The Realities for U.S. Retail

The beauty industry, both domestically and internationally, is in an interesting position at the moment. Following years of solid annual growth, to the point of a $450 billion global valuation, analysts now expect things to cool slightly.

Part of the reason behind this is that price growth was previously aligned with sales growth, creating momentum in revenues, benefiting the entire sector. Now, executives recognize that consumer uncertainty makes the former a less viable strategy.

Aside from the pop culture power benefitting South Korean cosmetic exports to the U.S., the main thing accelerating this trend is e-commerce. A total of 56.9% of all revenue in America’s beauty and personal care market is expected to have come from online sales over the course of 2025. Since South Korean brands can easily reach U.S. consumers via web stores and marketplaces, there are fewer barriers to this growth avenue.

Another telling fact is that 41.7% of South Korea’s cosmetics exports fall into the basic skincare category. This means the country’s beauty brands are beating their international rivals on staples including toners and moisturizers, rather than flash-in-the-pan niche products.

What the Future Holds

Based on current trends, it is probable that K-Wave beauty products will continue to enjoy double-digit growth, at least into 2026. And with the pop culture influence, South Korea can expect the U.S. to remain its biggest customer.

Cosmetics retailers in America must adapt their strategies to remain competitive. Whether by developing products that align with K-pop-savvy consumer expectations or partnering with Korean brands, various strategies suggest themselves.

The overarching trend here is one of an interconnected global marketplace, both for retail products and the cultural trends that determine demand for them. Retailers already know that e-commerce success must be pursued. Tapping into international trends and working with economic forces, not against them, has to be the path forward.

This story was produced by Incellderm and reviewed and distributed by Stacker.