Cosmetics have been around for centuries but in the modern era of social media, where selfies are uploaded at breakneck speed and beauty influencers garner huge followings, interest in aesthetic wellbeing seems to matter more than ever. It is therefore unsurprising that cosmetics giant Estee Lauder (EL) has experienced stellar growth in its profits over the last few years.
EL has outgrown many of its rivals through its focus on the global prestige beauty market - particularly higher growth skin care and makeup segments - and its strong portfolio of brands that includes its namesake, Clinique and M-A-C.
Not only has EL benefitted from expanding beauty usage and product trade-up in the West, but also from emerging markets which have seen rising per capita consumption. Nowhere is this more apparent than in China which has continued to grow strongly despite recent macroeconomic difficulties and trade war tensions.
An early adopter of digital, EL has a well-developed e-commerce platform and has spread brand awareness through social media campaigns. This has helped to accelerate growth, with e-commerce now representing 15% of total sales. EL’s shares are however highly valued so whether future growth can match expectations is another story.