This article was orginally written for thestrategystory.com
You can find the link here https://thestrategystory.com/2020/12/07/estee-lauder-companies-story
If you try to impress someone with your power or your wisdom, you will find it hard going. If you are sensitive to his needs, to what will bring him happiness … you will make him your friend.”
These were some wise words that Estee Lauder believed when one of the world’s most known cosmetic brands had started to flourish. And charm millions of people with the quality of its products.
When Estée Lauder started out in the 1940s, the American cosmetics industry was dominated by Elizabeth Arden, Helena Rubinstein, Charles of the Ritz, and Revlon.
Estée Lauder’s key qualities, centered around creativity and her desire to push boundaries to always inspire the customers to express their individual beauty made it into what is known today as one of the most desired brands. As per Forbes Estee Lauder Companies is one of the top 10 most influential cosmetic brands in the world
Estee Lauder built a cosmetics empire on the motto, “There are no homely women, only careless women.”
By convincing those “careless women” they could become beautiful, with a little help from her products-she took on the giants of the cosmetics world and won.
Estee started with little more than a dream. Through extraordinary ambition, impeccable taste, perseverance, innovative marketing, and hard work, this creative visionary became one of the wealthiest self-made women in America and created a family dynasty that continues today.
The Beginning
It was the time of World War I when, Lauder’s uncle, John Schotz, came to live with the family. A chemist, by profession, who specialized in making his own “secret” skin-care products, Schotz set up a makeshift laboratory in the tiny stable behind the Mentzer’s house and began concocting his creams.
A curious Estee used to watch and learn every day from what her Uncle used to do. With all the material in that tiny laboratory, those things slowly became her true path.
Gauging what women used to talk about with glimpses of discussion about their insecurity and family life, she was day and night creating solutions to aid these insecurities. A solution that women craved for.
To create a market for her product, she started giving free demonstrations and makeovers at salons, hotels, the subway and even in the street.
She also began visiting the homes of her clients, where she would do the makeup of their friends and sell more cream. It wasn’t long before Lauder was a fixture on the guest lists of New York City’s most influential hostesses.
The Difference Estée Lauder Created
One of the secrets to her success in such a crowded field, was also what she used to describe as her personal touch. Her signature move was to massage the lotion onto women’s faces with a strategy to side-step, rather than confront, her larger competitors.
Through fabrications, by dressing like her customers and imitating their behaviour, Lauder made herself into a sophisticated and debonair lady of the beauty-a role that quickly became indistinguishable from reality.
Realizing the true potential that her products now had on the women in America, Estee decided to sell her products only through upscale department stores.
Her first target was Saks Fifth Avenue. She convinced Saks to place a large order for her skin creams. Not so surprisingly, the store promptly sold out all of them within two days.
Her success with Saks convinced Estee that she could compete with such cosmetics giants as Revlon, Helena Rubinstein, and Elizbeth Arden.
She then became a persuasive salesperson dedicated to penetrating every fine departmental store in the United States
Estée Lauder: A Risk Taker and an Innovator with a unique approach
A classic entrepreneur and innovator who refused to listen to experts, Lauder’s risk-taking mentality, and refusal to settle for anything less than the very best changed the world of cosmetics distribution.
Lauder used to define the secret of her success more simply by stating that she was a woman with a mission and single-minded in the pursuit of establishing her dream.
Lauder, through all the ups and downs that she learned from her sales stint, embarked on an innovative promotion strategy.
Turned down by one ad agency after another because of the small size of their account, Lauder invested her entire $50,000 advertising budget in samples to be offered through direct mail, charity giveaways and as gifts with purchases. This resulted in addition of thousands of new customers.
The company continued to prosper throughout the 1980s and 90s, becoming the third-largest cosmetics company in America-with 10,000 employees and sales in excess of $2 billion. By 1999, Estee Lauder products accounted for nearly 50 percent of all retail beauty aids sold in America.
One of the strategy’s the company turned into a mantra was, ‘Launch at the top, and stay at the top’.
If you launch at the top of the market, you have two ways to go: up or down. If you launch into the heart of the market, there’s always someone who will sell a similar product cheaper than you, and you have no way to go but down in what becomes a race to the bottom.
The secret behind the success of Estée Lauder Companies
But the real reason Lauder has succeeded where others have failed was that she simply refused to give up.
I didn’t get here by dreaming or thinking about it. I got here by doing it. Estée Lauder
Estee has been known to resort to some highly creative tactics. She used one such tactic to get the prestigious Galleries Lafayette account in Paris.
When the manager refused to stock her products, Lauder “accidentally” spilled her Youth Dew on the floor during a demonstration in the middle of a crowd. As the appealing scent wafted through the air, it quickly aroused the interest of customers. The customers then began asking where they could purchase the product. Seeing this, the manager capitulated and gave Lauder her initial order.
Estee Lauder has been a monumental and inspirational brand. And so has been the journey of its rise from a mere homegrown brand to one of the largest cosmetic brands in the world. Her values of respect for the individual, integrity, generosity of spirit, entrepreneurship — remain at the heart of The Estée Lauder Companies. A brand that is now the global leader in prestige beauty with annual revenue of $14 billion and 48,000 employees working across the globe.
Hear it from the Lauder Family and its leaders about the values and culture that sets apart Estée Lauder Companies to make it a global powerhouse in the beauty business.
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