'Asia is a very big opportunity': Orthomol aims to replicate South Korea success in Vietnam and beyond
Orthomol has built a name for itself across South Korea with its combination of liquid vial and tablets / capsules products.
In South Korea, it works exclusively with Dong-A Pharmaceutical in distributing the products via different channels, including duty-free shops, retail, TV shopping, and even in-flight retail.
South Korea is now its largest export market and also the second largest after its domestic market. Sales in South Korea have jumped from 20,000 packs a year back in 2018 to as many as 200,000 packs a month this year.
In TV home shopping, which is a major health supplement sales channel in South Korea, Orthomol has witnessed instances where 15,000 packs were sold within an hour.
The company is now aiming to replicate its success in South Korea in other Asian and the Middle Eastern markets, where it is seeing good market opportunities.
“Asia is still a very big opportunity for us besides the Middle East,” Andreas Singer, senior international area manager at Orthomol told NutraIngredients-Asia.
Its liquid vial and tablet / capsule concept was first commercialised in 1997. Orthomol then introduced the concept into neighbouring countries Spain, Portugal, Luxembourg and into Eastern Europe countries such as Poland and Czech Republic.
Its Asia venture came in early 2010s, starting with Japan and later via cross-border e-commerce into China.
“China was our biggest Asian market for many years. We are now also present in Taiwan, Vietnam, which is also a very successful market for us.”
Its big break in Asia in the recent few years with South Korea, after two of its products – Orthomol Immun and Orthomol Vital were approved by the local food regulator and went on to gain a foothold in the retail market through Dong-A Pharmaceutical’s retail strategy.
Orthomol Immun was first approved in end-2019 and officially entered the retail channel in 2020, while Orthomol Vital was introduced last year.
Duty-free shop was its first step into the South Korean market, and it is now planning for other markets to follow suit.
By year end, for example, its products are expected to be sold in Vietnam’s duty-free shops.
“Going into duty free shops in Korea was also something different, something new for us. Our products are not only sold in the duty-free shops in Korea, but also on airplanes, so Asiana Airlines, KAL, Busan Airlines are selling our products in their duty-free shops.
“This is absolutely extraordinary and was a huge success that Dong-A has achieved in Korea and other countries are now trying to copy.
“In Vietnam, we are also going into the duty-free shops now, end of this year probably and also other countries are going to follow this trend,” said Singer.
This will add on to the list of beauty salons and clinics that it is already working with in Vietnam. In clinics and hospitals, for instance, the company’s pregnancy support product Orthomol Natal is available.
Deep understanding of local markets still crucial
Still, this does not mean that the company is adopting a one-size-fits-all approach for all its markets.
Singer said that it was crucial that the distributors have a deep understanding of the local market and knew where the best places are to sell the products.
“Each country has to look at where are the best targets to sell the products. In South Korea, Dong-A Pharmaceutical chose Olive Young shops. They know the market; they know exactly where to go to, and they have very successful strategies.
“For all other countries, our distribution partners also have to look at opportunities in their country and they know the market and know what the best idea might be.”
Back home in Germany and other European markets, the company also sticks to its pharmacy-only strategy.
“In Germany, we can also sell Orthomol in retail stores, but the strategy of Orthomol in Germany is very strict since the very beginning, where we only sell our products only in the pharmacy.
“This is a marketing and business decision taken by our management and by the owner of the company and this was the best decision ever for Germany, because people trust very much in products which are sold in pharmacies and recommended by doctors,” Singer said.
Entry into Singapore and Middle East's opportunities
Within South East Asia, it is now planning to enter Singapore, with Malaysia a potential candidate for next year as well.
Elsewhere in the Middle East, the company is also seeing market opportunities especially in the UAE and Saudi Arabia.
“The Middle East is a very big market where people have better position to purchase products which are a little bit more expensive than the others,” said Singer.
