August 19, 2011

Estée Lauder Plots New China Stores, E-Commerce Expansion To Stay Ahead Of Pack

New York-Based Cosmetics Maker Saw Record Gains In China Last Year

Estee Lauder signed Chinese supermodel Liu Wen as the face of its Pure Color Metamorphosis line last year

Estee Lauder signed Chinese supermodel Liu Wen as the face of its Pure Color Metamorphosis line last year

Coming off a year of record profits in China, Estée Lauder plans to invest even more in new stores throughout the Mainland while increasing e-commerce channels for its luxury lines, Hong Kong’s South China Morning Post reports today. According to Estée Lauder president and chief executive Fabrizio Freda, the company is hoping to take advantage of the rising spending power of Chinese consumers by making its products available “wherever they live and travel.” Remarking that his company estimates that Chinese consumers around the world spent some US$1 billion on products in the Estée Lauder family during the fiscal year 2011, Freda said the flagship Estée Lauder brand proved the most popular among mainland Chinese.

Looking to take advantage of its enviable position in the lucrative Greater China cosmetics market, Estée Lauder will kick off a large-scale expansion strategy that takes advantage of the current online retail trends taking shape there. “Over the next three years,” Freda noted this week, Estée Lauder plans to “introduce more luxury brands in China and open doors in additional cities, including department stores, free-standing stores and [cosmetics chain] Sephora.” Freda added that Estée Lauder currently sells products in 38 cities throughout mainland China, and intends to be in five more by the end of the current fiscal year. Plans are also coming together to add new e-commerce distribution channels for Estée Lauder-owned brands like Origins and Bobbi Brown.

Other brands in Estée Lauder’s portfolio include Clinique, M-A-C, La Mer, Aveda and Missoni.

While Estée Lauder leads the pack in China as the best-selling cosmetics brand on Taobao, and has done a particularly good job in terms of localization — the brand launched its Asia-focused “Pure Color Metamorphosis” line at a lavish event in Beijing last November — the priority the company places on the China market indicates the fierceness of competition in that country’s cosmetics market. With Japanese brands like Shiseido, premium South Korean lines like Sulwhasoo, European powerhouses like L’Oreal and even Chinese high-end hopefuls like Shanghai VIVE battling it out for market share, the China market will be both lucrative and expensive for Estée Lauder.


Cosmetics
Tag: aveda, cosmetics, e-commerce, estee lauder... , More
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