Estée Lauder winning out in emerging markets; turning now to male grooming

Market analysts at Trefis have highlighted that, alongside fellow beauty giant L’Oreal, Estée Lauder’s capacity for investment into R&D and advertising in emerging markets, particularly in the Asia Pacific region, means it has managed to win out against those brands with smaller budgets.

“Compared to deep-pocketed players like L’Oréal and ​Estée​ Lauder, Avon and Revlon had limited R&D and advertising budgets for developing and promoting locally relevant products​,” the analysts confirm.

Milking the emerging markets​

Estée Lauder has made strong headway in leveraging the opportunities of emerging markets in the last few years, allowing it to gain share in the face of depleting sales of prestige cosmetics in many developed markets.

Estée Lauder had R&D expenses of over $100 million last year, which totals more than what Revlon and Avon invested into product development combined: analysts suggest this is a key reason the brand has been able to charm in emerging markets.

The beauty company has also been able to benefit from its exclusivity in terms of a prestige brand.

“Being a prestige beauty product manufacturer, ​Estée​ Lauder has faced limited competition from either domestic or international mass-market brands, adding to its appeal to the emerging market consumer​,” Trefis analysts note.

Male grooming up ahead​

Moving ahead, it now looks like the brand is gearing up to tackle the increasingly lucrative male grooming market: it has just launched a new men’s skin care group which currently features Lab Series and Clinique for Men.

The brands in the male group will for the first time operate independently from the company’s female-focused lines.

“Men’s skin care is one of the fastest-growing categories in the world, and we thought it was time to put them together so we could talk about both the different venues and ways men are shopping​,” Lynne Greene has reportedly told The New York Times.