The high street brand was known as one of the foremost K-beauty brands, having expanded globally with hundreds of stores. By 2016, the brand had opened its own flagship store in New York City and was available through Sephora stores in Europe.
However, Tonymoly was among the K-beauty brands that suffered as a result of the clash between South Korea and China over the Terminal High Altitude Area Defence (THAAD) missile system.
Compounded with the shift the consumer trends and the competitiveness of the K-beauty market, Tonymoly became increasingly overshadowed by 2020.
The company celebrated its 14th anniversary during the height of the COVID-19 pandemic in 2020. The additional stress of the pandemic pushed the company to undergo a drastic transformation in order to boost its ability to serve the increasingly digitally focused consumer.
“With the advent of the 4th industrial revolution, strengthening digital capabilities have become a necessity for companies – not an option,” said Tonymoly chairman Bae Hae Dong.
The company recruited Jeong Kyung Hee as its chief digital officer. Jeong was the former senior vice president at SK Planet, a subsidiary of South Korean wireless telecommunications operator SK Telecom.
With Jeong on board, the firm established a three-year road map which included revitalising the firm’s online business, which included enhancing its own e-commerce platform, TonyStreet.
Digital acceleration
In November 2021, the company made the decision to issue KRW30bn (USD23.5m) in paid-in capital increase, in part to foster the development of TonyStreet.
With this, the company said it “expects to see the effect of increasing sales and improving profitability by 2022”.
The brand’s efforts seemed to have paid off as it announced on December 21 that sales on TonyStreet recorded 52% growth compared to the previous year.
Furthermore, traffic increased by 75%, with the share of young consumers aged 18 to 34 increasing by about 11.5%. New membership also increased by 25%.
Its sales on other platforms also recorded improvement. The company highlighted a 401% sales growth on the Kakao Talk gift-giving channel, which also allowed it to open up to new consumers.
Through Olive Young, South Korea’s leading health and beauty retailer, TonyMoly saw a 75.1% increase in monthly average sales compared to the previous year. This is in line with Olive Young’s own recent observations about older K-beauty brands finding new favour with younger consumers.
The company has also been pushing its overseas online business. In the first half of 2021, the company expanded in China through cross-border e-commerce with platforms such as Tmall Global and Little Redbook.
In addition to expanding its e-commerce business, Tolymoly has also made its first steps into Web 3.0 as part of its digital transformation strategy and “solidify” its image as a digital beauty innovator.
The brand launched TONYMOLY World on the metaverse platform, Zepetto. It believes this move would prepare the band to connect with a younger consumer base globally.