PRESENTED BY

MARISOL CANO

The Case Study

 Table of
Contents
Company’s External
1 Background 5 Analysis 9 VRIO Analysis

Mission and
2 Vision 6 5 Forces Analysis 10 Value Chain

Organizational PESTEL SWOT

3 Structure
7 Analysis 11 Analysis

Internal Strategy-
Corporate 8 Analysis 12 Diversification
4 Strategy
 ABOUT

• Founded in 1946 by Estée, and

Joseph Lauderas in New York.
CULTURE
• Grown to become one of the
• Quality, innovation, and customer
world's leading beauty and
satisfaction.
cosmetics companies. • The company fosters a culture of creativity
and diversity, valuing the unique
• The company's humble beginnings perspectives of its employees.
in New York laid the foundation
for its global presence today.

• Estée Lauder has cultivated a

culture of innovation and
excellence in beauty, setting
industry standards for quality and
luxury.
GENERATES 15.2 BILLION IN REVENUE
ANNUALLY

OPERATES 150+ COUNTRIES

62000+ EMPLOYEES

THE COMPANY’S OVERSEAS SALES

FROM MAKE UP OVER 60% OF ITS
BUSINESS.

THE COMPANY HAS BUSINESS

PRESENCE IN: ASIA/PACIFIC, EUROPE,
THE MIDDLE EAST AND AFRICA, AND
THE AMERICAS.
MISSION AND
VISION MISSION
"Bringing the best to everyone we touch and being the
best in everything we do."
Estée Lauder Companies is dedicated to delivering
exceptional beauty products and experiences, enriching the
lives of its customers, employees, and stakeholders.

VISION
"To be the global leader in prestige beauty, admired for
its innovation, quality, and commitment to excellence."
The company aspires to set the gold standard in the beauty
industry by continually pushing boundaries and redefining
the beauty experience.
ORGANIZATIONAL
STRUCTURE

Estée Lauder Companies employs a matrix organizational

structure, combining functional and divisional structures.
This enables efficient coordination and communication
across various functions and brands within the company.

Divisional Structure
The company is organized into four divisions: Skincare,
Makeup, Fragrance, and Haircare. Each division operates as
a strategic business unit, allowing for focused management
and innovation tailored to specific market needs.
 Corporate Strategy
• Growth Strategies
⚬ Focus on organic growth and strategic acquisitions
￭ April of 2023 → TOM FORD for US$2.8 billion
⚬ Expanding product portfolio, distribution channels, and geographic
presence
⚬ Continuous investment in R&D → innovate product portfolio

• Global Expansion
⚬ Building strong relationships with retailers worldwide
⚬ Consumer connections
￭ Freestanding stores, e-commerce sites, and social media
￭ Omnichannel experience in more than 150 countries
FIVE FORCES ANALYSIS
EXTERNAL ANALYSIS: FIVE FACTORS ANALYSIS
Threat of New Entrants:
Low-Medium
• High start-up costs required for entering the cosmetics
industry
• Estee Lauder & established companies benefit from
Economics of Scale
• Direct to Customers Brands pose a threat.
Threats of Substitutes:
Medium
• Substitutes: Alternative beauty & skincare products,
and trend towards organic alternatives.
• However, with the resources of Estee Lauder, they
have the ability to adapt.
Rivalry with Existing Competitors:
High
• High level of competition in the industry
• Intense rivalry is driven by factors such as brand reputation,
product innovation, marketing strategies, and retail presence.
EXTERNAL ANALYSIS: FIVE FACTORS ANLYSIS

Bargaining Power of Buyers: Bargaining Power of Suppliers:

Medium-High Medium
• Consumers have a range of choices in the • Suppliers, such as manufacturers of raw
materials have moderate bargaining power.
beauty market
• the quality and uniqueness of certain
• Consumers have relatively high bargaining
ingredients provide suppliers with leverage.
power. • However, purchasing size of E.L gives power
• Strong brand loyalty to established Estée
Lauder
 PESTLE ANALYSIS

Economic Factors: Technological Factors: Legal Factors:

Political Factors: Social Factors: • Compliance with
• Global Economic • Technology impacts Environmental Factors:
• The cosmetics • Shifting consumer laws related to
Conditions such as product innovation, • Growing consumer
industry has preferences towards product safety,
Economic downturns marketing, and awareness of
regulations, sustainability, cruelty- advertising, and
can affect consumer distribution channels in environmental issues
including ingredient free products,may intellectual property
spending on non- the cosmetics industry. has increased demand
restrictions, labeling influence Estée is crucial.
essential products like • Estée Lauder needs to for sustainable
and product safety Lauder's product • Legal challenges • Estée Lauder needs to
cosmetics. stay abreast of
standards. development and related to patents, consider sustainable
• Currency exchange technological
• Changes in trade marketing strategies. trademarks, or sourcing, packaging,
rates and inflation advancements for e-
policies, and Social media also plays product claims could and manufacturing
rates in key markets commerce, personalized
international a significant role in affect Estée Lauder's practices to align with
may impact Estée marketing, and
relations can impact shaping beauty trends brand image and these environmental
Lauder's costs and augmented reality
Estée Lauder's and consumer financial trends.
pricing strategies. experiences in beauty
operations, perception. performance.
retail.
Value Chain
SWOT Analysis Weaknesses

Strengths
Decreasing
Diverse Financial
Diverse Brand Marketing and Performance
Portfolio Distribution Global Territorial • revenues: Premium
• over 25 Channels Coverage US$15,94 pricing also
brands • increase • products million hinders
brand sold in over Innovation and growth in
• strategic • annual
awareness, 150 countries Research price-sensitive
acquisitions • strong focus on decline of
• beauty store traffic, • International 10.1% markets and
and sales reach R&D limit the
industry • aim: maintain
• CLINIQUE, • adaptation to • majority of customer base
e-commerce sales: Europe customer to middle to
Jo Malone, interest and Factors
M.A.C, etc. • ~ 1,600 free (39.1%), the high-income
loyalty • 17% decrease
standing Middle East, target
stores and Africa • competitive in skincare audiences
• 250 multi- advantage lower net sales
High-Quality branded • R&D costs: ($1,830 million)
2.2% of the • 3.2% in
Luxury Products store
• premium company’s total makeup
pricing revenue products
• reputation for • strong lower net sales
quality commitment to ($271 million)
local
consumers
SWOT Analysis

Opportunities
Threats
Consumer
Organic
preferences
Products-
Strategic Global Competition change-
the
Initiatives- Fragrances & from other Foreign beauty trends
implementatio
partner ship Skincare beauty Exchange change very
n of organic
with Marks products could Market companies- Risks- frequently so
& Spencer increase new extreme its hard for the
and demand from competitors fluctuations in company to
expansions consumers Global Online often disrupt foreign keep up and

into the who look for the market and make all of
Retail Market: exchange rates
cleaner could take these changes
men’s focus on puts the
ingredient and this could
beauty expanding e- over the status
products companies
of Estee result in loss of
industry commerce to revenue at risk
Lauder sales
increase online
involvement
 Sources
https://thestrategystory.com/blog/estee-lauder-swot-analysis/
https://www.elcompanies.com/en/who-we-are/the-lauder-family/the-estee-story

https://www.elcompanies.com/en/our-brands

https://thestrategystory.com/blog/estee-lauder-swot-analysis/#google_vignette

https://new.marketline.com/Company/Profile/the-estee-lauder-companies-inc?swot

https://www.statista.com/statistics/243722/brand-value-of-the-leading-15-cosmetic-brands-
worldwide/

https://advantage.marketline.com/Analysis?reporttype=5902&location=100244&q%5B%5D=estee
%2Blauder&exactword=1

https://www.statista.com/statistics/267936/net-sales-of-estee-lauder-worldwide/