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As part of its Newsmaker Forum series, Cosmetic Executive Women (CEW) welcomed William Lauder, president and CEO, The Estée Lauder Companies, to New York City’s Harmonie Club. Carlotta Jacobson, president, CEW, began the event by acknowledging both the event sponsors—which included Firmenich, Arcade Marketing and Cosmetic Essence, Inc.—and the changing horizons of the beauty business.
Lauder answered questions posed by Jill Scalamandre, chief marketing officer, Chrysallis, regarding the Lauder portfolio of brands, celebrity and designer fragrances, leadership and strategy. Lauder acknowledged the importance of knowing a brand’s consumers and understanding distribution channels. In regard to creating or acquiring brands, Lauder said, “It is a far more human process to see which brands truly fit in our portfolio. Clinique [for example] is one of the most phenomenal brands on the planet. Founded in 1968, it is just as unique today as it was when it was created. The aspirational positioning, without being prohibitively expensive, has made it one of the best brands in our portfolio.”
Further, he noted that Estée Lauder’s repair category is unique, and MAC color products are highly valued by consumers. “Likewise, acne and treatment are core values of Clinique. We are the world’s leading marketer of aspirational beauty brands. We know the mentality of our consumers around the world.”
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Lauder noted that just 10 years ago 90% of prestige beauty sales were through department stores. Today, that number is 70%. Consumer spending has shifted. “Some brands have been able to move themselves effectively to multichanneled retail venues; some have not. Those with the deepest roots have the hardest time transferring from the anchor stores to other channels,” he added.
In answer to a question regarding his competition, Lauder noted that it is very important to watch out for what is coming from behind you—notably newcomers with “amazing” ideas, positioning and appeal. “It’s the one that’s not even on your radar that you have to watch out for. It’s those really imaginative thinkers that may take you by surprise.”
Mirroring Jacobson’s opening statements and adding to the challenges of today’s market noted by Lauder, Jerry Vittoria, president, fragrances, North America, Firmenich, commented on the cost cutting necessitated by an increasingly myopic Wall Street, acknowledging the efforts of CEW to enable the industry to come together to exchange ideas and maintain momentum in the industry.