NEW YORK — Despite its roots in American department stores, the Estée Lauder Co. is focused on expanding its global reach and setting up shop in more retail venues, William P. Lauder, president and chief executive officer, told shareholders at the annual meeting Tuesday.
Talk centered on China, which, at $100 million in sales, is the beauty firm’s fifth-largest Asian market. Lauder said he expects China to quickly become the company’s second-largest Asian market, behind Japan, and one of the firm’s top-five markets overall.
Since entering China two decades ago, the Estée Lauder Cos. has introduced eight brands into the country, and plans to launch Origins there in 2008. Brands there are sold in 60 doors across 31 cities.
“We expect to be the leading prestige cosmetics company in China,” said Lauder. Company chairman Leonard Lauder noted that the company laid the groundwork for China early and began advertising its brands there in Elle magazine five years before entering the market.
The company reminded shareholders that it sells its 26-plus brands in spas, perfumeries, pharmacies, freestanding stores and online, which experienced sales growth of 40 percent last year. William Lauder announced that Bobbi Brown will open 30 freestanding stores, and continue to expand its business in travel retail, Asia and Europe. He added that MAC Cosmetics plans to open 30 additional stores on top of the 140 freestanding stores it currently operates, and will enter six new countries this year. Together, the two makeup artist brands have grown 20 percent annually in the last five years, he noted.
William Lauder also said that, despite losing 75 doors, due to the Federated Department Store-May Co. merger, the company still grew fiscal 2006 sales 3 percent to $6.46 billion from $6.28 billion.
On the international front, in the last year, the company’s globe-trotting included rolling out MAC Cosmetics to Jordan, China, Cyprus and India; bringing its Tommy Hilfiger fragrance brand to India, and launching the Estée Lauder brand in Vietnam.
It also continued to expand its brand portfolio in fiscal 2006, introducing Grassroots to Kohl’s Department Stores and the Sean John and Missoni fragrances.
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Mattel Inc. and MAC Cosmetics are expected to announce plans today for an “adult-target project” involving the Barbie brand, due to launch worldwide in the spring.
“MAC and Mattel share more in common than you might expect,” James Gager, senior vice president and creative director for MAC, said in a statement. The color cosmetics brand is owned by the Estée Lauder Cos. “We are both creatively driven companies that have remained true to our inherent cultures and DNA….Our creative collaboration and staging the beauty image of Barbie around the world is something I am personally very excited about.”
Mattel noted that, since Barbie’s debut in 1959, the doll has been the linchpin in collaborations with more than 50 fashion designers, including Bob Mackie and Diane von Furstenberg, but this deal marks the first time Barbie has been aligned with a prestige cosmetics company.
Richard Dickson, senior vice president of marketing, media and entertainment, worldwide, for Mattel, said in a statement, “Barbie and MAC continually set the global style agenda, and our collaboration will not only have the fashion and beauty community — but the world — ablaze this spring.”