Estée Lauder Companies

The Estée Lauder Companies Inc. (/ˈɛsteɪ ˈlɔːdər/ stylized as ESTĒE LAUDER) is an American multinational manufacturer and marketer of prestige skincare, makeup, fragrance and hair care products, based in Midtown Manhattan, New York City. The company owns a diverse portfolio of brands, distributed internationally through both digital commerce and retail channels.

The Estée Lauder Companies Inc.
Public
Traded asNYSE: EL (Class A)
S&P 500 Component
ISINUS5184391044 
IndustryCosmetics
Founded1946 (1946)
New York City, New York, U.S.
FoundersEstée Lauder
Joseph Lauder
HeadquartersGeneral Motors Building
New York City, New York, U.S. 10153
Key people
William P. Lauder
(Executive Chairman)
Fabrizio Freda
(President and CEO)
ProductsSkin care, makeup, fragrance and hair care
RevenueUS$11.824 billion (2017)[1]
US$1.692 billion (2017)[1]
US$1.249 billion (2017)[1]
Total assetsUS$11.568 billion (2017)[1]
Total equityUS$4.384 billion (2017)[1]
OwnerLauder Family (40%)[2]
Number of employees
46,000[3] (2017)
Websitewww.elcompanies.com

History

The company began in 1946 when Estée Lauder and her husband Joseph Lauder began producing cosmetics in New York City. They first carried only four products: Cleansing Oil, Skin Lotion, Super Rich All purpose Creme, and Creme Pack.[4] Two years later, in 1948 they established their first department store account with Saks Fifth Avenue in Manhattan.

Over the next 15 years, they expanded the range and continued to sell their products in the United States. In 1960, the company started its first international account in the London department store Harrods. The following year it opened an office in Hong Kong.

In 1964, they introduced Aramis, a line of fragrance and grooming products for men named after an exotic Turkish root originally used as an aphrodisiac.[5] In 1967, Estée Lauder herself was named one of ten Outstanding Women in Business in the United States by business and financial editors.[6] This was followed by a Spirit of Achievement Award from Albert Einstein College of Medicine at Yeshiva University in 1968. In that year, the company expanded again, opening Clinique, a dermatologist-guided (Dr. Norman Orentreich), allergy-tested, fragrance-free cosmetic brand.

Estée Lauder's Clinique brand became the first women's cosmetic company to introduce a second line for men when, in 1976, they began a separate line called "Skin Supplies for Men", which continues to be sold at Clinique counters worldwide. In 1981, the company's products became available in the Soviet Union.

In the 1990s, brand acquisitions and licensing agreements contributed to explosive growth as the company transformed from a family-owned business to a publicly traded, family-controlled organization. The decade opened with the creation of Origins — the first wellness brand in U.S. department stores. The first licensing agreement for fragrances was with fashion designer Tommy Hilfiger in 1993, followed by Kiton,[7] an Italian fashion house (1995), and with American fashion designer Donna Karan (1997).[8]

Brand acquisitions began with an investment in the Toronto-based M•A•C Cosmetics in 1994, which the company then acquired in 1998. Bobbi Brown Cosmetics, designed by the celebrated makeup artist, was acquired in 1995, as was La Mer – along with the original recipe for its supreme luxury product, Crème de la Mer, containing the nutrient-rich Miracle Broth™. The company ventured into its first hair care and holistic beauty brand with Aveda in 1997. The renowned fragrance house Jo Malone London was acquired in 1999.[8]

On November 16, 1995, The Estée Lauder Companies went public on the New York Stock Exchange at $26.00 a share ($6.50 on a post-split basis).[9]

Acquisitions and licensing continued in the 2000s as The Estée Lauder Companies bought a majority interest in Bumble & bumble, the trendy hair care salon, and completed its acquisition in 2006; an exclusive global licensing agreement was signed with fashion designer Michael Kors (2003). Designer Tom Ford begins a project with the company and later an agreement was signed with him (2005) to develop and distribute fragrances and cosmetics under the Tom Ford Beauty brand.[8]

On July 1, 2010, the company acquired Smashbox Beauty Cosmetics, Inc., a brand created in Smashbox Studios in Culver City, California, by brothers Dean and Davis Factor (as in Max).[10]

The large Estée Lauder cosmetics counter at MYER Sydney City
Small-medium-sized pre-2013 style counter at New Zealand retailer Farmers

On October 28, 2011, Aramis and Designer Fragrances, a division of The Estée Lauder Companies Inc., and Tory Burch LLC announced the signing of a multiyear agreement for the exclusive worldwide license of the Tory Burch fragrance business. This partnership marked Tory Burch's first step into the beauty industry. The first Tory Burch fragrance products were introduced in 2013.[11]

In 2012, the company launched AERIN Beauty, a luxury lifestyle beauty and fragrance brand inspired by the signature style of its founder, Aerin Lauder.

In 2014, the company acquired two insider beauty brands, RODIN olio lusso, a skin care brand renowned for its "Luxury Face Oil," and Le Labo, a fragrance and sensory lifestyle brand. Later that year, the company also made its first investment in India by buying a minority stake in Forest Essentials, a luxury cosmetics company specializing in Ayurvedic products.[12] In 2015, the company acquired Editions de Parfums Frédéric Malle, a fragrance brand, and GLAMGLOW, a Hollywood skin care brand.[13]

In 2016, the company acquired Becca Cosmetics, their first color cosmetic group acquisition since Smashbox in 2010.[14] In November 2016, the company made its largest acquisition to date by acquiring California-based cosmetics company Too Faced for US$1.45 billion.[15]

In 2019, the company acquired Dr. Jart+. Founded in Korea in 2004, Dr. Jart+ pioneered the invention of the BB Cream, setting the standard for multifunctional beauty.[16]

Marketing

The Estée Lauder company has many brands and Estée Lauder is one of the brands. It has had sometimes high-profile spokesmodels, sometimes referred to simply as 'faces'. Past 'faces' for Estée Lauder include Karen Graham, Bruce Boxleitner, Shaun Casey, Willow Bay, Paulina Porizkova, Elizabeth Hurley, Carolyn Murphy, supermodel Liya Kebede was the first African American 'face' of Estee Lauder, Anja Rubik, and actress Gwyneth Paltrow. As of 2008 the main spokesmodel for Estée Lauder was supermodel Hilary Rhoda. In 2010, the company added three more faces to the roster, Chinese model Liu Wen, Puerto Rican model Joan Smalls, and French model Constance Jablonski.[17]

In 2015, Estée Lauder signed model Kendall Jenner to promote the brand.[18]

In 2017, the company announced Violette Serrat as their Global Beauty Director.[19]

Alvin Chereskin, the founder of AC&R, was the long-time creative partner of the company.[20]

Operations and finances

Finances

For fiscal year 2016, the Estée Lauder Companies achieved net sales of $11.26 billion, a 4% increase compared with $10.78 billion in the prior year. Net earnings for the year were $1.11 billion, a 2% increase compared with $1.09 billion last year, and diluted net earnings per common share rose 5% to $2.96, compared with $2.82 reported in the prior year.[21] As of 2018, Estée Lauder Companies ranked 258 on the Fortune 500 list of the largest United States corporations by revenue.[22]

Board of Directors

Current members of the board of directors of Estée Lauder Companies Inc. are: Charlene Barshefsky, Rose Marie Bravo, Lynn Forester de Rothschild, Fabrizio Freda, Paul J. Fribourg, Wei Sun Christianson, Irvine Hockaday, Jennifer Hyman, Jane Lauder, Leonard A. Lauder, Ronald S. Lauder, William P. Lauder, Richard Parsons, Barry Sternlicht, Jennifer Tejada and Richard F. Zannino. [23]

Executive management

Leonard A. Lauder is chairman emeritus. William P. Lauder is executive chairman. Fabrizio Freda is president and chief executive officer.[24]

Breast Cancer Awareness Campaign (BCA)

In October 1992, the BCA campaign was launched by Evelyn Lauder (Estée's daughter in law) who co-created the "Pink Ribbon"[25] with SELF magazine as a symbol of breast health. Since then, millions of people globally have heard the message about the importance of breast health and early detection can save lives. The Estée Lauder Companies’ annual Breast Cancer Awareness campaign involves all of the 19 brands that make up the Estée Lauder Companies. They collectively represent The Breast Cancer Research Foundation’s first and largest corporate supporter. Estée's daughter-in-law created BCRF's signature pink ribbon.


Since 1992, The Estée Lauder Companies’ Breast Cancer Campaign has raised more than $89 Million globally for lifesaving research, education, and medical services.[26]

Brands

The Estée Lauder Companies brands include:[27]

Controversies

SOPA

Estée Lauder Companies appeared on lists of major companies supporting SOPA, the controversial, but unsuccessful, Congressional anti-piracy bill that was considered overreaching by critics.[30][31]

Child labor

In 2001, it was reported that children were discovered working in a factory in Cambridge, New York, making products for Origins, one of Estee Lauder's natural products brands. This was true, the owner's granddaughter and grandson. The contracted company was Common Sense Natural Soap & Bodycare, owned by a group led by cult leader Yoneq Gene Spriggs. Estee Lauder says it immediately moved to terminate the contract with the manufacturer it had been in business with for 5 years, claiming it was totally unaware prior to the initial inspection.[32]

Animal testing

The Estée Lauder Companies performs non-animal and human volunteer testing to assess product safety and efficacy. The Estée Lauder Companies does perform animal testing where required by law. The Chinese government requires testing on animals for many cosmetic products.[33] This causes controversy for smaller brands that are "cruelty free" but were bought out by Estée Lauder. Estée Lauder becomes the parent company of the smaller brand and profits through the smaller brand.

Boycott and anti-boycott
QUIT activists protesting Estée Lauder Companies, 2004.

Since at least February 2001, Estée Lauder and its brands have been the target of a boycott campaign led by pro-Palestine activists who have targeted the corporation because of the pro-Israel activities of Ronald Lauder.[34][35] In June 2003, the San Francisco-based Queers Undermining Israeli Terrorism (QUIT) took up the boycott with their "Estée Slaughter" campaign.[36] The boycott has generated an anti-boycott campaign by supporters of Israel.[37]

gollark: It's just attached to my keyring, it only gets plugged in when I need to update stuff on it.
gollark: In case of spontaneous implosions of all my computers, I think I would just have to find a working computer with Linux on it, decrypt my USB thing, and use the SSH keys on it to access osmarkscloud™.
gollark: Doubtful.
gollark: I don't think both I and all my computers will be struck by lightning simultaneously.
gollark: I have backups of critical things on a USB stick I carry with me.

References
  1. "Estee Lauder Companies, Inc. (The) Common Stock (EL) Financials". www.nasdaq.com.
  2. "Ownership". The Estée Lauder Companies. Retrieved October 16, 2018.
  3. "Estee Lauder". Fortune.
  4. Howerton, Ashley Brooke. "The Estee Lauder Companies Background and History". University of Tennessee.
  5. Aramis elcompanies.com
  6. "Cosmetics billionairess, Estée Lauder, dies". www.bizcommunity.com. Retrieved March 14, 2020.
  7. Kiton elcompanies.com
  8. Who we are: Key moments elcompanies.com
  9. Investors elcompanies.com
  10. "ESTÉE LAUDER COMPANIES - Investor Relations - News Release". Investors.elcompanies.com. Retrieved July 17, 2015.
  11. "ESTÉE LAUDER COMPANIES - Investor Relations - News Release". Investors.elcompanies.com. Retrieved July 17, 2015.
  12. "Estee Lauder to up stake in Forest Essentials - The Economic Times". Economictimes.indiatimes.com. December 18, 2014. Retrieved January 4, 2020.
  13. "Fact Sheet FY 2014". Elcompanies.com. Retrieved July 17, 2015.
  14. "Welcoming BECCA to The Estée Lauder Companies". www.elcompanies.com.
  15. "Did Too Faced Founders Cash Out Too Early? Sale To Estee Lauder Suggests Yes". Forbes.com. November 15, 2016. Retrieved February 15, 2017.
  16. "Dr. Jart+". www.elcompanies.com. Retrieved August 17, 2020.
  17. "The New Faces of Beauty: Of the Minute". models.com. Retrieved April 16, 2010.
  18. Kendall Jenner and Estée Lauder fashionista.com November 2014
  19. Jensen, FashionNetwork.com,Emily. "Violette named new global beauty director for Estée Lauder". FashionNetwork.com. Retrieved November 29, 2018.
  20. Elliott, Stuart (December 15, 1995). "THE MEDIA BUSINESS: Advertising;Alvin Chereskin, a longtime force in beauty advertising, gives up retirement for Fresh Carats". The New York Times. ISSN 0362-4331. Retrieved March 5, 2020.
  21. http://www.elcompanies.com/~/media/Files/E/Estee-Lauder/investors/toolkit/4qtr16.pdf
  22. "Estee Lauder". Fortune. Retrieved November 25, 2018.
  23. "ESTEE LAUDER COMPANIES-CL A (EL:New York): Board of Directors - Businessweek". Investing.businessweek.com. Retrieved July 17, 2015.
  24. "Our Leaders". Elcompanies.com. Retrieved July 17, 2015.
  25. Template:Prod Rgn Subheading. "Breast Cancer Awareness | Estée Stories Blog". esteelauder.com. Retrieved January 4, 2020.
  26. "The Breast Cancer Campaign". www.elcompanies.com. Retrieved August 17, 2020.
  27. "Our Brands". Elcompanies.com. March 22, 2011. Retrieved July 17, 2015.
  28. "Why Estee Lauder Is Buying This Cosmetics Brand for $1.45 Billion". Fortune. November 15, 2016. Retrieved November 15, 2016.
  29. "The Estée Lauder Companies Acquires RODIN olio lusso". Elcompanies.com. October 31, 2014. Retrieved July 17, 2015.
  30. "All the Companies Supporting SOPA, the Awful Internet Censorship Law—and How to Contact Them". Gizmodo.com. Retrieved July 17, 2015.
  31. "List of Supporters: H.R. 3261, the Stop Online Piracy Act" (PDF). Judiciary.house.gov. Archived from the original (PDF) on December 27, 2011. Retrieved July 17, 2015.
  32. Jeane MacIntosh (April 9, 2001). "State probes cult in child-labor scandal – acting on heels of post report". New York Post. Retrieved April 9, 2018.
  33. "In China, big cosmetics firms are selling products tested on animals". Retrieved April 1, 2018.
  34. "Boycott Israel Campaign". Retrieved August 6, 2006.
  35. "American Muslims for Jerusalem have called for a boycott of Estee Lauder products". Snopes. Retrieved August 6, 2006.
  36. "Queers Undermining Israeli Terrorism". Archived from the original on July 8, 2006. Retrieved August 6, 2006.
  37. "Armchair Activist: Buy Estee Lauder Products". May 11, 2001. Archived from the original on June 7, 2002. Retrieved August 6, 2006.

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