CJ Olive Young will take a two-track approach to targeting the North American market by opening directly run stores and entering Sephora, a major retail channel. The move is notable because it aims to introduce the "Olive Young" platform in North America beyond simply exporting products.

On Jan. 22, the industry said Olive Young plans to open its first directly run North American store in the western United States in May. California, where CJ Group logistics infrastructure is concentrated, is considered a likely location. It plans to enter the western region first and then expand to other areas depending on customer response.

The directly run store is likely to be designed around an experiential concept. That is because Olive Young has been strengthening services such as skin scan diagnostics and makeup trial spaces at stores it has recently opened or renovated. A prime example is the five-story Olive Young N Seongsu, which opened in November last year. It placed experiential services such as skin scan diagnostics and makeup trial spaces at the forefront. It also incorporated experiential elements such as "Pick Your Color" and "Lux Edit" at Gwangju Town, Daejeon Town, Cheongju Town and Seomyeon Town, which were revamped in 2024. An Olive Young official said, "So far, foreign customer responses show a tendency to focus on experiences rather than densely packed product displays," adding, "We will reflect this in North American stores as well."

It will also begin operating a "K-beauty zone" (tentative name) at Sephora in the second half. It will not be a shop-in-shop format, but is expected to take the form of a "curated zone" that concentrates K-beauty indie brands on shelves bearing Olive Young's brand identity (BI).

The ability to respond to local U.S. regulations is also cited as an Olive Young strength. The U.S. Modernization of Cosmetics Regulation Act (MoCRA) took effect in July 2024, making FDA facility registration, product listing and ingredient disclosure mandatory. Overseas manufacturing facilities must designate a U.S. agent, and noncompliance can lead to penalties such as recalls or import alerts. The procedures are a heavy burden for individual brands to handle.

Olive Young, as an intermediary vendor, will have brands go through required regulatory procedures such as MoCRA certification. It will purchase K-beauty products and supply them to local distribution channels such as Sephora in the form of a "curated Olive Young" offering. An Olive Young official said, "The key is to build an integrated system for entering overseas markets that lowers entry barriers faced by small and mid-sized brands, such as cultural differences and legal reviews."

Some also say it is unclear whether a platform-centered market entry strategy will work.

Entering Sephora creates a multi-stage distribution structure that runs from manufacturers to Olive Young and then to Sephora. The industry says a key variable is how North American consumers, already accustomed to direct purchases through Amazon official stores and D2C brand stores, will view Olive Young's curation fee. To lower prices, Olive Young's margin will inevitably have to shrink.

Attracting major brands will also be difficult. Large companies prefer to enter directly through local subsidiaries even if they must shoulder regulations and taxes. In fact, Amorepacific established a foothold in the North American market by acquiring Cosrx in 2021, and LG Household & Health Care secured local distribution channels by acquiring Avon in 2019. Critics say that if the Olive Young platform becomes like a display channel, smaller brands may build awareness and then leave the platform.

A beauty industry official said, "Olive Young is saying it will take responsibility from discovering brands to marketing while serving as an intermediary vendor, but if a brand grows, there is a strong possibility it will switch to direct entry," adding, "It is convenient at first, but the key is whether Olive Young can maintain its own premium over the long term."

With that in mind, Olive Young plans to build its sales lineup around well-known and popular products. The industry said many of the more than 10 brands that post annual sales of more than 100 billion won at Olive Young alone are likely to be included. Its own private-brand products will also be included, such as Wakemake, Bio Heal Boh and Bring Green.

Olive Young is also keeping open the possibility of working with distribution networks in other regions such as the United Arab Emirates (UAE), in addition to North America beyond Sephora. It said details such as the number of brands and store locations will be disclosed in the second half.