Estée Lauder Bolsters Portfolio with Fresh Brands Amid Business Overhaul

Estée Lauder has put the launch of new brands on its roadmap. The U.S. cosmetics group is set to boost its growth by expanding its market share and rejuvenating and diversifying the origins of its target, while continuing its restructuring process.

In an interview with Reuters, the company’s CEO Stéphane de La Faverie pointed to the “emerging middle class” as a key market to watch in its strategy to 2030. The company will strengthen its presence in the Americas and in emerging markets, “without neglecting China,“ whose consumption has weakened in recent years.

In recent months, Estée Lauder has taken minority stakes in beauty brands in China, Mexico and India. La Faverie explains that The Ordinary, its accessible skin care proposition is gaining popularity among Generation Z consumers, “whose purchasing power is growing.“ Tom Ford, for its part, “has shown strong growth in recent quarters”.

Estée Lauder has taken minority stakes in beauty brands in China, Mexico and India

The company is in the midst of restructuring its top management, which has already undergone several strategic changes this year in an attempt to mitigate the impact of weak consumer spending in the U.S. and China.At the beginning of the year, the group announced the resignation of its chairman, Peter Jueptner, after sixteen years with the company. Earlier, the company fired its chief financial officer, Tracey T. Travis, to bring in Akhil Shrivastava.

In July, Estée Lauder named Franck Besnard senior vice president and general manager for the Northern and Western Europe region. Last year, moreover, the company announced that Stéphane de La Faverie would succeed Fabrizo Freda as CEO of the company.

The global beauty industry is undergoing a profound transformation after years of rapid expansion. The sector has entered a phase marked by consolidation, divestments and polarization among large groups. The clearest example is the plan promoted by the new CEO of Kering, Luca de Meo, who confirmed the sale of its cosmetics division to L’Oréal for €4 billion.

Estée Lauder began its fiscal year by beating expectations, with sales of $3.481 billion in the first three months of the fiscal year, which ended on September 30th. This is 4% more than in the same period last year, when it posted sales of $3.361 billion.