Estée Lauder creates Advanced Night Repair store at Beijing Airport

Estée Lauder strengthens its position as the leading travel retailer in the Asia-Pacific market with the launch of Advanced Night Repair concept store at Beijing Airport. The travel retail channel is one of ELC’s strongest distribution networks which has grown at thrice the pace of international passenger growth rate in FY2013. The article below discusses how the newly opened store will shape ELC’s history of market leadership.

CHINA. Estée Lauder has created an Advanced Night Repair Synchronized Recovery Complex II concept store, in partnership with Sunrise Duty Free, at Beijing Capital International Airport Terminal 3.

The boutique, operational throughout April, showcases the brand's best-selling serum and how it supports a natural night-time purification process called Catabolysis, which is vital to younger-looking skin.

Image Source: moodiereport.com

The concept store features a luxurious city loft design and incorporates exterior glass windows that expose a city skyline, and sparkling, starry night-style lighting within the exterior canopy and store ceiling. A lounge area in the centre aims to offer travellers a welcoming environment.

Estée Lauder Beauty Advisors are on hand to educate consumers on the extensive clinical, sensory and safety testing of Advanced Night Repair Synchronized Recovery Complex II, which has been completed on over 1,000 women around the world. Caucasian, Black, Indian, Hispanic and Asian women – including Japanese, Chinese and Korean consumers – were all featured, demonstrating that Advanced Night Repair Synchronized Recovery Complex II is ideal for all skin types and proven for all ethnicities.

Estée Lauder introduced the concept of night-time repair to the anti-ageing category in 1982, when Night Repair – as it was then known – revolutionised the segment. The formula, presented in the now-iconic “little brown bottle” with the apothecary dropper, rapidly became one of the best-performing skincare products in Estée Lauder history.

The latest formulation features new ChronoluxCB Technology, which is said to take advantage of the restorative power of night by combining potent purifying and synchronising technologies to maximise nightly renewal of the look of skin.

Advanced Night Repair Synchronized Recovery Complex II is claimed to dramatically reduce the look of every key visible sign of ageing for a significantly younger look. Lines and wrinkles look significantly reduced and skin is strengthened to help prevent further damage, according to the brand.

In addition, there are High Touch elements, featuring consultations via digital tools, including a skin analyser and imatch foundation finder. 

Estee Lauder Chairman William Lauder remains true to the company’s legacy of leadership in the beauty sector as he continues to establish ELC as a strong travel retailer within the Asia-Pacific region. Follow this blog for more news and information on ELC’s growing portfolio of prestige skincare brands.

REPOST: Higher Passenger Traffic From Asia-Pacific Should Bolster Estee Lauder Travel Retail Sales

Forbes analyzes how the growth in Asia-Pacific passenger traffic would drive the future of Estee Lauder Companies in the travel retail sector.

Image Source: chinadaily.com.cn

 

In FY2013, prestige beauty product maker Estée Lauder reported sales of approximately $10.2 billion compared to $9.7 billion in sales in FY2012, a 5.2% increase. The company sells its products through various upscale departmental stores, specialty retailers, prestige salons and spas. In total, Estée Lauder estimates it has close to 30,000 points of sale within these distribution channels, generating sales of its beauty products across the world. Additionally, the company also markets its products through freestanding stores, duty-free and travel retail outlets worldwide, and also its own and other authorized retailer websites.

In this note, we provide an analysis of Estée Lauder’s travel retail business, underlining various factors that impact the division’s performance and its potential value contribution to overall top line for the company. We have a $75 Trefis price estimate for Estée Lauder, which stands at an 11% premium to its market price.

A Look At Estée Lauder’s Travel Retail Business

Travel retail sales for Estée Lauder increased to over $1 billion in FY2012, driven by the increase in global passenger traffic. For fiscal 2013, sales from the travel retail channel grew at thrice the pace of global passenger growth rate. According to data from the IATA, global passenger demand expanded 5.2% in 2013, from close to 3 billion passengers in 2012. This should put Estée Lauder’s travel retail sales growth rate at over 15% for fiscal 2013, to stand at approximately $1,156 million. Much of the 15% growth rate in travel retail comes from the sale of skin care products. As a percentage of overall revenue, this marks a sizable 11.4% contribution from the travel retail channel for Estée Lauder.

Asia-Pacific Passenger Traffic Growth Should Support Strong Travel Retail Expansion

A major factor for travel retail revenues standing at three times global passenger traffic is the combination of expanding disposable income in the Asia-Pacific region, along with strategic positioning of travel retail outlets by Estée Lauder. The main customer base for a travel retail outlet is the global passenger, and hence, positioning such outlets in high traffic corridors is key to having a higher growth rate.

International passenger demand is the highest for the Middle Eastern region at 12.1% in 2013. Similarly, emerging market regions of Latin America, Africa and Asia-Pacific registered growth rates of 8.1%, 5.5% and 5.3% respectively, in international passenger demand. Meanwhile, developed economies of Europe and North America had growth rates of 3.8% and 3% in international passenger demand. The Asia-Pacific region, in addition to outpacing passenger demand from developed economies, leads the world passenger traffic with a 29% share according to Airbus, followed by Europe and North America at 26% and 25% respectively.

Estée Lauder has capitalized on the strong demand for international travel from Asian customers and is the leading travel retailer in the Asia-Pacific market. By the end of fiscal 2012, the company had a total of 1,600 travel retail outlets worldwide. However, we believe a majority of these travel retail outlets to be situated in travel corridors popular among Asian customers, given their expanding discretionary wallet share. Going forward, the company could continue to establish itself as a strong travel retailer within the Asia-Pacific region by opening more stores.

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Travel Retail Investments Should Lead To Market Share Expansion For Estée Lauder

Going forward, Airbus expects domestic travel within China and India to drive overall Asia-Pacific passenger demand, with annualized growth rates of 7% and 10% respectively through 2032. In addition to strong domestic travel growth, international travel corridors (such as Intra Asia, Asia – Middle East, Asia – PRC and Central Europe – Western Europe) are expected to see a higher demand in passenger traffic than the global growth rate of 4.7% annually through 2032. This burgeoning demand surrounding the Asia-Pacific and Middle East regions should drive future investments into travel retail from cosmetics companies.

We expect Estée Lauder to increase its investments into the travel retail business in the future, driven by the higher revenue growth rate from the division. Through its travel retail channel, Estée Lauder has achieved a 15% top line growth rate compared to 4% for overall revenues in CY2013. Additionally, growth in travel retail is primarily resulting from the sale of skin care products. At the end of CY2013, we estimate Estée Lauder’s skin care market share to stand at approximately 7.6%. However, higher investments into travel retail should be able to drive future revenues and expand its skin care market share in the future.

William Lauder has been able to shape Estée Lauder Companies into a brand-building powerhouse that it is today with his leadership and unparalleled commitment to innovation and creativity. Click here for more updates on ELC's expansive portfolio.

REPOST: Aveda founder, Horst Rechelbacher, dies at 72

Renowned eco-entrepreneur Horst Rechelbacher died in his home in Osceola, Wis., at the age of 72. He was diagnosed with pancreatic cancer in 2011 and is survived by his wife, daughter, and son. This article looks back on Rechelbacher’s life as an eco-warrior. 

Image Source: telegraph.co.uk

Rechelbacher, who will be celebrated as an eco-revolutionary, leaves the natural beauty world in mourning.
Austrian-born Rechelbacher was an organic beauty activist. His calling came during his early career as a celebrity stylist (he tended to the tresses of Sophia Loren, and ran four salons and a hairdressing school) during which a chemical build up in his salons - which caused him and his colleagues to become ill - shocked him into taking action. This was to be Rechelbacher's career, life, catalyst, and by 1968 - after a life-changing trip to India - he began developing a more natural line of products with his mother. Ten years later, those shampoos and conditioners were labelled Aveda.

A true visionary in the beauty industry, as WWD reports, Rechelbacher was among the first to seek fairtrade sourcing, non-toxic ingredients, organic certification, plant-based aromatherapy, and food-grade formulations for his new brand, Aveda.

So successful, and so cult-like, by 1997 Aveda was making $100 million a year. Rechelbacher, already moving on his next project, decided to sell the company to Estée Lauder for $300 million. Leonard A. Lauder, chairman emeritus of the Estee Lauder Cos., Inc, commented this week that Rechelbacher was a true visionary and unique human being: "Horst himself single-handily created a new industry."

Rechelbacher put a large chunk of the money from the sale into informing the rest of the world about the chemicals lurking in our beauty products, namely petroleum-based ingredients, often hidden in so-called 'natural' and 'organic' lines too.

Once his non-compete clause with Estée Lauder was up, the eco-warrior also launched his own line, Intelligent Nutrients - close to 100 per cent organic in its formulations, Intelligent Nutrients was a "reflection of what Horst wanted for himself," as Telegraph journalist Lucie Young reported back in 2011. In the same interview Young likened Rechelbacher's home, Deer View in Winconsin, to a "parallel universe, where green values are the norm."

Rechelbacher normalised organic beauty for the rest of us too. "Pesticides and insecticides make people sick and are destroying the planet," he once said. His solution was simple; "don't put anything on your skin that you can't eat." He was often seen seen drinking his Intelligent Nutrients hair sprays and serums which were all painstakingly formulated - I witnessed it first hand at one product launch in London.

"How he lived personally, he tried to express professionally," his widow, Kiran Stordalen, explained to WWD . "You see that in all the work he's done. It was a personification of who he was. He lived and breathed the mission and has left an incredible legacy."

The green beauty industry has lost a true visionary; "the planet has lost one of its most passionate friends. So have we," said a statement by Intelligent Nutrients. "To know Horst was to wake up to the world around you, to your own potential, to a new way of thinking." But as the statement adds, and the green beauty world hopes, "his impact truly does live on in salons, shops, fields and minds worldwide. And his mission continues."

Horst Rechelbacher founded the safe beauty products brand called Intelligent Nutrients (IN) after selling his skin care company Aveda to Estee Lauder Companies in 1997. ELC Executive Chairman William Lauder and the rest of the Lauder family are deeply saddened by the loss of a true visionary. Click here to learn how the global cosmetics conglomerate celebrates the legacy of Rechelbacher and the other founders of its brands.

REPOST: The Estée Lauder Companies Names Jane Lauder Global Brand President, Clinique

Jane Lauder's appointment as the Global Brand President of Clinique is part of Estée Lauder's organizational redesign efforts to drive the skincare brand's future success. The article offers an overview of Ms. Lauder's executive profile.

 Image Source: finance.yahoo.com

NEW YORK--(BUSINESS WIRE)--The Estée Lauder Companies Inc. (EL) announced today that Jane Lauder has been named Global Brand President, Clinique. Succeeding Ms. Lauder will be Stephane de la Faverie who has been named Senior Vice President/Global General Manager, Origins, Ojon and Darphin. Their new roles will become effective on April 1, 2014.

Both Ms. Lauder and Mr. de la Faverie will report to Lynne Greene, Group President of Clinique, Origins, Ojon, Aveda and Darphin. As announced in 2012, Ms. Greene was promoted to Group President as part of an organizational redesign to further align brands and provide high potential leaders with increased opportunities. Appointing Ms. Lauder to Clinique supports this evolution and will enable Ms. Greene to focus on the strategic direction of her brand portfolio and her other significant leadership responsibilities.

“Lynne’s vision combined with her industry-leading creativity has propelled Clinique’s exceptional global results and her close partnership with Jane will enable Clinique’s future success. Jane’s new role reflects her proven talent as one of our Company’s valued business leaders and innovative thinkers. Her ability to take brands and help maximize their global potential has been a key driver in our Company’s success,” said Fabrizio Freda, President and Chief Executive Officer, The Estée Lauder Companies.

In addition to supporting the Company’s organizational evolution, this appointment was a natural move for Ms. Lauder who earlier in her career was Senior Vice President, Global Marketing for Clinique where she was responsible for the brand’s overall strategic marketing and helped take the brand into new markets. As a result of her success in this role, Ms. Lauder later became Global Brand President, Origins, Ojon and Darphin.

“Jane is a very driven and talented leader. With her deep knowledge of today’s global consumer, I am delighted to have her back on the Clinique team where I know she will be extremely successful in advancing the long heritage of innovation,” said Lynne Greene. “Stephane brings significant experience in multi-brand leadership and expertise in skin care. His track record demonstrates his strength in successfully growing smaller brands and taking them into new markets. I am confident that both Jane and Stephane will bring outstanding growth and leadership to their brands.”

“It is our people who make our Company great. As Jane and Stephane continue on their Estée Lauder Companies journey, we grow as a Company—leveraging their strengths to drive our success,” said William P. Lauder, Executive Chairman, The Estée Lauder Companies. “Both are terrific leaders who consistently recognize global opportunities and most of all, inspire their teams to deliver excellence.”

Mr. de la Faverie joined The Estée Lauder Companies in 2011 as Senior Vice President, Global General Manager, Aramis and Designer Fragrances; shortly thereafter Lab Series and GoodSkin Labs were added to his responsibilities. Since joining the Company, Mr. de la Faverie has helped grow Aramis and Designer Fragrances’ profitability and expand the Company’s designer fragrance portfolio. Throughout his tenure in the beauty industry, Mr. de la Faverie has worked to build a number of skin care brands. Most recently under his leadership, the men’s skin care brand, Lab Series, successfully launched several major innovations globally.

Mr. Freda said, “Stephane is an ideal person to build on the success from Jane’s prior leadership. His keen ability to think globally and act locally will help the Origins, Ojon and Darphin teams continue to focus on their fastest-growing opportunities.”

In November of 2012, William P. Lauder and Fabrizio Freda announced an organizational redesign to drive the Company’s future success by further aligning brands, ensuring focus on the greatest opportunities globally and creating growth for talent worldwide. The appointments announced today are a continuation of this organizational evolution.

The Estée Lauder Companies Inc. is one of the world’s leading manufacturers and marketers of quality skin care, makeup, fragrance and hair care products. The Company’s products are sold in over 150 countries and territories under the following brand names: Estée Lauder, Aramis, Clinique, Prescriptives, Lab Series, Origins, M•A•C, Bobbi Brown, Tommy Hilfiger, Kiton, La Mer, Donna Karan, Aveda, Jo Malone, Bumble and bumble, Darphin, Michael Kors, American Beauty, Flirt!, GoodSkin Labs, Grassroots Research Labs, Tom Ford, Coach, Ojon, Smashbox, Ermenegildo Zegna, Aerin Beauty, Osiao, Marni and Tory Burch.

An electronic version of this release can be found at the Company’s Website, www.elcompanies.com.

For William P. Lauder, executive chairman of The Estée Lauder Companies, success lies in one's ability to perform. Click here to learn how he was able to turn the cosmetics company into an $8 billion global enterprise by cultivating a culture of entrepreneurship and leadership excellence.