Distribution channels emerge as a standard of validation

In the beauty market, a growing trend has taken hold in which sales performance in distribution channels, rather than laboratories or advertising, proves a product’s credibility first. As Daiso expanded its cosmetics assortment to more than 2,200 items, it became a starting point where overseas buyers directly seek out products and manufacturers, while Olive Young is effectively serving as an on-site showroom for consumers visiting Korea as foreign offline purchases rise rapidly.

This change has emerged because brands have moved beyond simple competition for store placement and have begun using distribution networks themselves as export-validation tools and data-collection tools. In addition, as companies expand structures that combine content and sales, such as AI- and XR-based 'wellness inner beauty tech platforms', distribution is being transformed from a sales outlet into core infrastructure that influences not only product planning but also overseas expansion.

The growing weight of ingredient development in wellness expansion

As the health functional food and inner beauty markets grow, companies are shifting the focus of competition from selling finished products to discovering ingredients and verifying their functions. Ildong Bioscience partnering with the Fermented Microorganism Industry Promotion Institute, LG Household & Health Care joining hands with the Korea Food Research Institute, and CJ Wellcare collaborating with Seohung Healthcare are all responses aimed at quickly securing materials suited to country-by-country regulations and consumer demand.

Behind this is a change in which consumers now demand more segmented benefits targeting everyday discomforts and specific bodily functions, rather than broad phrases such as immunity. hy is continuing the long game of functional validation by accumulating more than 5,100 strains, and the rise of narrower, more specific target functions—such as Newon’s Gac extract or Dongkoo Bio & Pharma’s ingredient that may help maintain hearing—shows that the market is moving from emotion-driven consumption to evidence-based consumption.

Regulation is moving down to the point of sale

Along with market expansion, oversight is no longer stopping at the research and approval stages but is moving down to the actual moment of purchase. The Ministry of Food and Drug Safety is expanding QR-based access to information on 33 functional ingredients that require caution when taken with medication, and it has also decided to change the certification mark for health functional foods starting January 1, 2028 so that it can be more easily distinguished from labeling on general foods.

This is because as health functional foods become everyday consumer goods, the possibility that consumer misunderstanding could directly lead to health risks has grown. Cases such as the seizure of around 97,000 counterfeit Chinese cosmetics and health functional food products and the third inspection of unfair advertising for albumin foods mean that future competitiveness will include not only the ability to sell well, but also the management capability to distinguish authenticity and help consumers understand usage information.

The industry landscape shifts from cosmetics to the lifestyle management industry

As the boundary between beauty and health functional foods fades, the center of gravity in the industry is moving from appearance-improving products to lifestyle management solutions. In China’s 114 trillion won market as well, demand is growing for wellness products backed by ingredients and clinical evidence, while in Korea, metabolic management products such as those with blood sugar control functionality are rising, and the ingredient production base is also being expanded to an annual production capacity of 16,500 tons, triple the previous level.

This trend gives companies new growth opportunities, but at the same time demands more sophisticated localization and stricter verification. Ultimately, the competition ahead will not be about releasing many products that simply look appealing, but about how reliably companies can connect consumers’ everyday issues—such as sleep, eating habits, and metabolic condition—with trustworthy products and information.