Estee Lauder: A Beauty Industry Powerhouse

The Estee Lauder company sells a wide range of beauty and hair-care products and currently has a workforce of 31,300 individuals. Throughout its existence, the company has acquired or joined forces with numerous renowned beauty brands. Among the well-known companies within the Estee Lauder family are Clinique, Aramis, La Mer, Origins, Bumble and Bumble, Aveda, and Bobbi Brown.

In 2006, Estee Lauder marketed their products to more than 130 countries and forged partnerships with renowned designers Coach and Missoni to develop their fragrance line.

Additionally, they sold their makeup brand, Stila, in the same year due to insufficient profitability. In 2007, Estee Lauder acquired Ojon, a well-known Canadian hair-care company, while divesting their Rodan + Field brands. Sales in China and Russia experienced significant growth, resulting in a nine percent increase in the company's overall sales compared to the previous year.

The company announced that Frabrizio Freda, previously from Proctor and Gamble, would become their future president and chief operating officer starting in 2008. In the same year, Estee Lauder hired Omnicon Media Group’s M2M as their advertising agency in twelve different countries, including locations in Europe and Asia.

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Also in 2008, Estee Lauder launched their Time Zone Line and Wrinkle Reducing Moisturizers, which were clinically proven to reduce the visible age of the skin. Additionally, the company established a new manufacturing and development facility in Ontario.

During the months of September, October, November, and December, Estee Lauder advertised several products. These included Double Wear Lipstick, Advanced Night Repair, Double Wear Makeup SPF 10, Bold Volume Lifting Mascara, and Sensuous by Estee Lauder (perfume).

The Double Wear Lipstick was particularly popular and was featured in three magazine ads. The Advanced Night Repair also received significant attention, appearing multiple times on the fourth cover page of magazines and in promotional emails from the company.

The Double Wear line offers a variety of features, including the option to choose between liquid or powder makeup, the ability to achieve desired coverage, and a wide range of shades suitable for all skin types. It also boasts advantages such as long-lasting staying power lasting up to twelve to fifteen hours, comfortable wear, and a silky smooth texture. Additionally, the products in the Double Wear line provide the benefit of SPF-10 protection and eliminate the need for touch-ups once applied.

On the other hand, Advanced Night Repair has its own unique features. It helps prevent future damage caused by aging and reduces existing damage to the skin.

The Advanced Night Repair is a unique product that has many advantages. It has been developed through extensive research for over 25 years and features Estee Lauder's exclusive Chronolux Technology. Additionally, it holds more than 20 worldwide patents, making it truly one-of-a-kind. This special formula cannot be found anywhere else and offers incredible benefits such as visibly reducing signs of aging on the face.

In addition to the advertised products, Estee Lauder also provides a wide range of beauty care items including makeup for the face, eyes, and lips, as well as tools like makeup brushes, makeup remover, and nail polish.

Estee Lauder caters to various skincare needs with a selection of products including firming, age-prevention, anti-wrinkle, moisturizers, and skin tone evening. Their luxury line called Re-Nutriv includes makeup and skincare infused with genuine gemstones. Estee Lauder also provides fragrances for both men and women as well as discounted gift sets that combine skincare, perfume, and makeup. The brand's main focus is on the female demographic.

Estee Lauder focuses on women, specifically older women who prioritize anti-aging and maintaining a youthful look. These women tend to have higher incomes, ranging from average to high. Estee Lauder provides a diverse range of products priced between $20 and $1000. The company's target market corresponds to two consumer categories identified by VALS II - Achievers and Actualizers - both seeking premium products that Estee Lauder offers.

Estee Lauder's customers are known for their willingness to try different products, although they may switch between brands. However, the company is confident that these customers will return because of the high quality of their products. Amongst their target market, the actualizers are the ones who spend the most money. Estee Lauder specifically targets them to purchase their luxury line, ReNutriv, which can be quite expensive, with prices going up to $1000 for an 8.4 ounce jar of creme. Additionally, Estee Lauder targets actualizers by highlighting the scientific advancements in their formulas. For instance, they advertise the use of Chronolux Technology in their Advanced Night Repair product, appealing to the actualizers' interest in technology. Within their target market, two retail target markets that Estee Lauder focuses on are Classic and Update.

Estee Lauder meets the needs of the Classic Market through their sales counters in specialty stores, providing exceptional service. The salespeople are highly knowledgeable and committed to assisting customers in finding their ideal makeup or skincare solution. Additionally, the Classic Market does not prioritize product sales, hence Estee Lauder rarely offers discounts and is able to charge premium prices. On the other hand, the Update Market is a more fashion-conscious group that seeks to stay up-to-date with trends. To cater to this market, Estee Lauder primarily advertises in women’s fashion magazines, aiming to attract attention.

Due to the current market trend favoring department store shopping, Estee Lauder strategically places their sales counters in various stores like Macys, Lord and Taylor, Bergdorf Goodman, and Nordstrom. A competitor of Estee Lauder is Lancome, a brand under L’Oreal, offering comparable products and services at competitive prices. Lancome even has their version of Estee Lauder's Advanced Night Repair called Genifique. Both companies target the same audience and frequently advertise in the same magazines.

Lancome and Estee Lauder have sales counters in the same department stores, often located near each other. They both offer similar gift sets at discounted prices and have "free gift with purchase" sales promotions. In terms of creative strategy, Estee Lauder's magazine advertisements are typically two pages or appear on the second and fourth cover pages. In American magazines, these ads are bleed ads with dark backgrounds, usually navy blue or black. Examples include the Double Wear Lipstick, Sensuous by Estee Lauder, and Double Wear Makeup SPF 10 ads, all featuring black backgrounds.

All of the advertisements for Advanced Night Repair feature a navy blue background with a picture of a DNA ladder behind the product image. However, the November 2009 issue of U. K Cosmo had a different advertisement for their Bold Volume Lifting Mascara, which had a golden yellow background. The Bold Volume Lifting Mascara was exclusively advertised in the U. K issue and no other American magazine had ads for this product. The text on all makeup magazine ads is white. The headline, "Estee Lauder", is always displayed in all capital letters and positioned either at the top or bottom of the ad.

The Double Wear Makeup ads consistently have the text "Estee Lauder" placed at the bottom left of the page beneath the picture of the model. The Sensuous perfume ad has purple text, likely chosen to match the white shirt worn by the model. Unlike other ads during this time period, this ad's headline is positioned in the middle of the page, which is quite uncommon. All advertisements featuring a model utilize one specific individual: an exquisite brunette with fair skin, slender figure, vibrant blue eyes, and lightly wavy hair that shines beautifully. This particular model appears in every ad except for Advanced Night Repair.

Regardless of the medium used for advertisement, the model representing the product is consistently positioned on the left page. There are occasions when she may also be featured on the right page, but it is guaranteed that a picture of her will always be present on the left page as well. This can be observed in the Double Wear Lipstick ad, where the left page predominantly showcases the model's head, while her profile extends to the right page. Moreover, this same model is also showcased in email advertisements from the company and is prominently featured in the Virtual Makeup Tool on the Estee Lauder website. Therefore, regardless of the time or platform of the advertisement, the graphics featuring this model remain consistent.

The Advanced Night Repair ad showcases a prominent image of the serum. Meanwhile, in the Double Wear Lipstick ad, five lipsticks of different shades can be found in the bottom right corner. The Sensuous ad captivates with a model that dominates the entire page, while the perfume bottle sits discreetly in the bottom right corner. In the Bold Volume Lifting Mascara ad, four mascara tubes and one brush are positioned in the bottom right corner. Lastly, the Double Wear Makeup SPF-10 ad features a compact filled with pressed powder, along with two liquid foundations placed in the bottom right corner.

The Double Wear Lipstick line ran three different ads during this time period. The three ads had identical content, with only the sub-headlines and amplifications being different. The September and October ads featured the sub-headline "12-Hour Staying Power. New Double Wear Lipstick". In contrast, the December advertisement had the sub-headline "Double the Wear, Double the Color. New Double Wear Lipstick". The only difference between the amplification in the September and October ads was that the price of the lipstick was shown only in October.

The amplification for it displayed a suggested retail price of $22.00. The December ad had a completely different amplification compared to the previous two, but still mentioned the same features, advantages, and benefits. All of these ads had the same call to action: "shop now at esteelauder.com". There is not much white space on these ads, except for the noticeable white space on the back page of the Sensuous ad. The headline, Estee Lauder, appears at the top in a large font. At the very bottom of the ad, there is an image of the Sensuous gift box that occupies around forty percent of the page.

The sub-headline, "Wrap her in warmth and luxury. Seductive Destination 82. 50, Worth over 120. 00", is centered amidst ample white space in the middle of the ad. The aim of the ad campaigns was to inform and persuade. Estee Lauder wanted to ensure people were aware of the new products: Advanced Night Repair and Double Wear Lipstick. These two products received the most emphasis during this period. The ads for these products contained more text than previous ones, allowing for a clearer explanation of their features.

Estee Lauder's Advanced Night Repair advertisement focused on explaining how the serum repairs damage resulting from the environment and genetics. The ad aimed to inform consumers about their innovative products, ultimately persuading them to make a purchase. It emphasized that their technology was unique and supported by scientific research. The ad employed various execution styles including slice of life, lifestyle, and scientific evidence. For instance, the use of slice of life was evident in the line "For every woman, every night" in the Advanced Night Repair ad.

The advertisement aims to convey that the product is intended for nightly use in order to reduce the signs of aging. This message is prominently featured in the advertisement to communicate that it is a product meant for everyday use. The Double Wear Makeup SPF- 10 ad also employs the element of slice of life in its commercials. They mention that "whether it's a workday, a workout, or a weekend there's a Double Wear formula to keep up with your active day", highlighting that this makeup is suitable for daily use regardless of the customer's activities. Furthermore, lifestyle is a recurring theme in all of these advertisements. Sensuous, for instance, appeals to a male audience by assuring them they can "Wrap her in warmth and luxury".

Estee Lauder aims to convey that their perfume is designed to make women feel opulent and unique when they wear it, while also enhancing their mood. The Double Wear Lipstick simplifies a woman's life by relieving her of concerns about the longevity of her makeup. They claim that one application is sufficient, eliminating the need for touch-ups. Advanced Night Repair claims to reduce signs of aging caused by previous exposure to environmental factors and offers protection against future damage.

The Advanced Night Repair ad highlights scientific evidence in its claim. It asserts that DNA damage accelerates skin aging and mentions the inclusion of twenty-five years of groundbreaking DNA research and the newly patented Chronolux Technology, which aims to minimize the effects of aging. The ad further emphasizes its advancement by stating that it is "tomorrow's technology- today," making it appear more futuristic and technologically superior to other serums available in the market. The Bold Volume Lifting Mascara advertisement also shows scientific evidence.

The ad discusses the unique feature of the "BrushComber" which combines the thickening power of a brush with the precision of a comb. These ads use various execution styles that align with the objectives of informing and persuading consumers. Through scientific evidence, potential buyers are informed about Estee Lauder's exclusive technology. Additionally, the lifestyle and slice of life execution styles aim to persuade customers to purchase the products by showcasing the improvements they can bring to their daily lives. This media analysis highlights these strategies.

Estee Lauder utilized various media vehicles for advertising, including magazines like Elle, Cosmopolitan, Cosmopolitan U.K, Self, Vogue, InStyle, People, and Glamour. Additionally, they were featured on department store websites such as Macys.com and Nordstrom.com. Promotional emails were also regularly sent to individuals on the company's mailing list. The estimated audience reach for Elle Magazine alone is 1,105,456 customers. Specifically, Estee Lauder ran a Double Wear Lipstick ad which comprised of two full page colored bleed ads. In December, the cost for a colored one page bleed ad was $138,175.

Estee Lauder ordered advertising space in Elle Magazine two months in advance, giving their ad a long lead time. The total cost of the ad was $276,350, with a CPM of $249.99. Since Elle Magazine is issued monthly, the advertisement had a one month shelf-life. However, due to the high clutter in the magazine caused by a large number of advertisements, it was harder for Estee Lauder to impact their customers. On the other hand, Cosmopolitan magazine reached 2,907,436 customers.

Estee Lauder placed their Sensuous by Estee Lauder and Double Wear Lipstick ads in Cosmopolitan magazine costing $215,900 for a one page color ad. Both ads were bleed ads, costing an additional 15% which brought the price to $248,285. In addition to that, Estee Lauder used two pages and included a scent sample, resulting in a total price of $496,570 per ad. The CPM for each ad was $170.79. To secure their advertisements, Estee Lauder had to pay at least one month in advance, requiring a lead time of one month or longer.

The monthly magazine Cosmopolitan has a shelf-life of one month and is predominantly made up of advertisements, resulting in high clutter and low frequency. Self magazine reaches a customer base of 1,516,075. The Double Wear Makeup SPF-10 by Estee Lauder was featured on the second cover page and the third page of Cosmopolitan. The cost for advertising on the second cover page is $200,123, while the full color bleed ad on the third page costs $97,100. The overall price for this advertisement came to $297,223, with a CPM of $196.05.

Self magazine is published monthly, giving the ad a one month shelf life. There is high clutter due to the large amount of ads in the magazine. The reach for Vogue is 1,298,480 customers. Estee Lauder ran several different ads with this magazine. They used the fourth cover page in October 2009 for an Advanced Night Repair ad. The asking price for the fourth cover page was $188,922. The CPM for this ad was $145.49.

Estee Lauder also ran their Double Wear Lipstick ad and their Advanced Night Repair ad which were both two page, color, bleed ads, costing $302,266 each. The CPM for these ads was $232.8 each. Vogue is also issued monthly, giving the ad a one month shelf-life. Vogue, like Cosmopolitan, is mainly comprised of advertisements, creating high clutter. The reach for Instyle magazine is 1,738,787 customers. Estee Lauder ran their Advanced Night Repair ad on their fourth cover page. The asking price for the fourth cover page was $201,800, making the CPM of this ad $116.06.

Instyle magazine is published monthly, giving the advertisement a one month shelf-life, and there is high clutter due to the large amount of advertisements within the magazine.

The number of customers reached by People Magazine is 3,615,858. Estee Lauder placed a one page color bleed advertisement in the September 28 issue, costing $266,780. The cost per thousand (CPM) for this ad was $73.78. People Magazine is published weekly, so the ad will be visible for a week. Estee Lauder had to provide their printing materials about twenty six days before the publication date, resulting in a lead time of approximately 26 days. On the other hand, the reach for Glamour magazine is 2,389,915 customers. Estee Lauder featured their Advanced Night Repair ad in a two page colored bleed format.

The cost of a full page color bleed ad for Glamour magazine was $200,491, contributing to the total cost of $400,982. This results in a CPM of $167.78. The magazine is published monthly, so the ad will be available for one month. Estee Lauder had to submit their ads at least a month and a half in advance, resulting in a lead time of at least a month and a half. During this period, Estee Lauder also sent promotional emails to individuals who signed up on their website's mailing list.

There was no clutter in these emails as they were directly from the company and only pertained to their products. These emails were sent out every few days, giving them a shorter shelf-life than magazine ads. Estee Lauder actively used sales promotions to sell products. They often offered free gifts with purchases over a certain amount. For example, in September, Macy’s offered a free gift bag filled with makeup with any Estee Lauder purchase of $29. 50 or more. This gift was advertised by Estee Lauder in the September 28 issue of People Magazine.

The company advertised popular products during this time period, including a deluxe sample of Advanced Night Repair and two Double Wear Lipsticks, in a gift bag. Nordstrom offered free gifts with any $39.50 Estee Lauder purchase in October. Customers had four options for bags filled with goodies aimed at different skin concerns - lifting, reducing, toning, or preventing aging. The value of this gift bag was $125. Estee Lauder also promoted free shipping on their website for purchases over $50, as well as three free samples of the customer's choosing with any purchase.

During November, Estee Lauder offered a complimentary gift bag worth $125 with any purchase of $39.50. Customers could also customize their skincare and makeup shades for the gift. After this promotion, Estee Lauder introduced the Color Spectacular Promotion, where customers could purchase the Estee Lauder Color Spectacular Cosmetic Traveler for just $55 with any Estee Lauder fragrance purchase. This Traveler includes twenty-five shades of eye shadows and blushes, as well as mascaras, eyeliners, lipsticks, brushes, a travel mirror, and two cases, with a total value of over $340.

The promotion began on November 16th on Estee Lauder's website and then expanded to Macy's on November 20th. This promotion is currently ongoing.

Financial Overview: Over the past three years, Estee Lauder's total sales have increased by over one billion dollars, going from $6,463,800,000 in 2006 to $7,910,800,000 in 2008. The net income has also experienced significant growth. Three years ago, the net income was $244,200,000, whereas last year it rose to $473,800,000.

Conclusion: No research evidence has been found regarding pre-testing or post-testing for Estee Lauder.

Estee Lauder has been focusing on both market penetration and production development. Their older skincare and makeup products have performed exceptionally well in the past three years, with sales continuing to grow steadily. Additionally, they have introduced new skin care products to further drive sales. While the United States and the Americas have traditionally been the top-selling regions, Estee Lauder is now prioritizing increasing their market shares in the Asia-Pacific region. This strategic shift is in response to the recent economic downturn in the United States. The company hopes that in the future, the Asia-Pacific region will surpass all others to become their primary market.