NEWSROOM
Atomy Entering Kazakhstan and Kyrgyzstan
- Name한은경_global
- Reporting datetime2021.08.19 17:36
Atomy Entering Kazakhstan and Kyrgyzstan
Center of the Silk Road and an Advanced Base for the CIS Market
Atomy is accelerating its entry into the Central Asian market. Atomy plans to begin its official operations in Kazakhstan and Kyrgyzstan this year. The New Zealand region has already started operation and the UK and Turkish regions are also ready to start their operations. The year 2021 is the starting point for a truly global Atomy, in which the global sales exceeds the sales in Korea. In this issue, we will look into Kazakhstan and Kyrgyzstan, which will be the advanced bases for the CIS market.
Health Functional Food Market Growing in Kazakhstan - HemoHIM Stands Out
Kazakhstan is the largest market in Central Asia. It is the world's ninth largest territory in the world, with a population of 19 million and a per capita income of USD 9,731.
Central Asia, composed of five countries: Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan, is the center of the Silk Road that connects India, East Asia, and Europe. Kazakhstan, which gained independence from the Soviet Union on December 16, 1991, is expected to be the region with the most promising economic development in Central Asia.
According to analysis by Korea Trade-Investment Promotion Agency (KOTRA), private consumption in Kazakhstan is expected to recover steadily as fiscal spending increases and movement restrictions are lifted. Also, the export of cultural contents due to the Korean wave, such as K-pop and dramas, and the increase in demand for cosmetics due to interest in beauty and well-being, as well as the health functional food, due to COVID-19 are great positive factors for Atomy's entry. The health functional food market in Kazakhstan is showing remarkable growth as the demand to prevent COVID-19 by strengthening immunity is increasing.
According to KOTRA, 2020 health supplement market in Kazakhstan had a growth of 11.2% year-on-year in terms of local currency (KZT). The main items include multivitamins, immune boosters, and nutritional supplements related to the prevention of cardiovascular diseases, and international brands in the US and Europe are well known. It is particularly noteworthy that network marketing brands, such as Amway and Oriflame, are leading those markets. Atomy's HemoHIM is also receiving positive responses in the region. KOTRA has recommended strategies to target younger generations who are interested in health care and well-being life by using online marketing tools.
As for the cosmetics market, K-pop and K-drama are becoming more popular, and as a result, interest in Korean beauty products is increasing. Among cosmetics, products that contain functionality such as natural moisturizing and UV protection ingredients are preferred, and the popularity of hair care products that include various functions, such as shampoo, essence, and conditioner, is also increasing. Recently, online marketing and influencer marketing have been booming due to the spread of smartphones and the improved communication environment. In addition, Kazakhstan consumers are willing to purchase a product even if it is more expensive as long as the quality is good, so it is believed that Atomy's Absolute Quality Absolute Price will have sufficient market competitiveness.
Kazakhstan's network marketing market is USD 356 million (KRW 415.3 billion), the world's 35th largest as of 2019. Over the past three years, it has grown 8.3% annually, with about 1 million network marketing people, accounting for just over 5% of the total population. The main product line is cosmetics and wellness, which account for 58% and 21% respectively, followed by food products (7%), clothing and accessories (6%), and household goods and durable goods (4%). What is noteworthy is that the proportion of food products has been expanding recently.
Kyrgyzstan Will be An Attractive Open Market
Kyrgyzstan is the first CIS region to join the World Trade Organization (WTO) and introduced the Western market economy. With a land area of 200,000 square kilometers, which is similar to the Korean Peninsula, the population is about 6.6 million and the per capita income is USD 1,309. It is worth noting that many people still maintain a nomadic life. Overall, Korean products are considered to be high-end products. In particular, with very high awareness of computers and IT products, interests in cosmetics and health foods are increasing.
Kyrgyzstan is highly interested in trade, such as WTO accession and trade agreements with CIS regions. This is due to its proximity to China, Uzbekistan, Russia, and other Soviet regions. In particular, it is attractive to Atomy that it is an open market with little restrictions on corporate activities because legal regulations are eased not only for domestic companies but also for foreign companies. The retail market is worth USD 4.1 billion (KRW 4.6 trillion) as of 2020, with USD 73.7 million (KRW 84 billion) in beauty categories.
An official from the Kyrgyzstan region said, “The future growth potential of Kyrgyzstan is great,” and added, “We are looking forward to serving as a hub for advancing into the CIS and Central Asian regions.”
Main Network Marketing Items in Kazakhstan
Wellness
Cosmetics
Food and Beverage
Clothing and Accessories
Household Goods and Durable Goods
Home Care
Others
Network Marketing Status by CIS Region
Unit: USD 1 million / Source: WFDSA
Editor Young-Min Lee
