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Estee Lauder SWOT & PESTLE Analysis

ID : 52396653| May 2018| 16 pages


Business Sector :Cosmetics and Lifestyle

Operating Geography :Manhattan, United States, North America

About Estee Lauder :

This esteemed company, originating in America is a world famous name when it comes to the domain of cosmetics. It deals with hair care, skin care, make-up products and fragrances. The company has an edge over most brands in the ownership of a highly diverse portfolio that is sold through numerous distribution channels throughout the world in the form of retail outlets and through E-commerce channels. As of 2018, it has its presence in 150+ countries and trades on NYSE as EL. The company was founded in 1946 by the Lauders in Manhattan city with only four products initially, which all dabbled in the domain of skincare. Gradually by the 1960’s they moved into fragrances and expanded their portfolio which they have maintained ever since. The brand established a high recall factor among the masses through its brand influencers, faces or iconic spokespersons like Elizabeth Hurley and Willow Bay. Alongside the business aspect the social quotient of the brand is also very strong given its involvement in Breast Cancer Awareness campaigns since 1992.

Its mission statement states ‘Bringing the best to everyone we touch and being the best in everything we do.’

Its USP or unique selling point is 'We are the only major company focused solely on prestige beauty, with an unparalleled portfolio of more than 25 differentiated, aspirational brands suited to consumers in every region.'

Estee Lauder Revenue :

$11.82 billion net sales (FY 2017)

Competitive Analysis of Estee Lauder

The SWOT analysis for Estee Lauder is presented below:
1. Strong Brand Equity
2. Growth reflected through financial parameters
3. Distribution Channels
4. Product Quality & Superior Marketing Techniques
1. Product portfolio is specialized
2. Ownership within family
1. Emergence of new markets
2. Favourable demographics
1. Counterfeit products
2. Rising cost challenges
3. Complaints and boycott movements
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Detailed SWOT Analysis of Estee Lauder



1. Strong brand equity: Estee Lauder has been a leading American brand ever since 1946 when it was started by the Lauder couple in Manhattan. Once started as a brand with only 4 products has expanded into various product lines wherein Estee Lauder has established itself as the gold standard of cosmetics in America. Additionally Estee Lauder has roped in brand influencers like Gwyneth Paltrow, Elizabeth Hurley, leading names in the industry of showbiz for long times, who have ended up as brand influencers and faces of the brand, giving Estee Lauder a wider appeal in the minds of the masses as a brand of premium cosmetics. In addition to that the brand has taken part in various movements of a widespread social dimension like the Breast Cancer campaigns ever since 1992 , accumulating a huge fund as off date , which have endeared it all the more creating a strong brand legacy and corresponding recall factor.

2. Growth reflected through financial parameters: The bygone year, that is 2017, was one of the best in the history of Estee Lauder as it saw a major surge in the prices of its stocks. It generated sales of almost 13 billion over its huge portfolio over the year. Accompanying that, the stock prices grew by about 80% over the course of the entire year. In fact it was not just an overall growth but even the rate of growth increased in every quarter. By expanding their operating margins, the earnings per share furthermore increased significantly throughout the entire period beating various expectations of market analysts and experts. The main factors that have promoted this growth has been identified as increased appeal to millennial by roping in celebrities with a heightened social media presence like Kendall Jenner, who is highly popular with that particular age group. Additionally, the demographic factor has also helped the company.

3. Distribution Channels: Estee Lauder has distribution channels spread all over the world through retail stores and their growing ecommerce channel. Asia is one of their biggest markets, which houses more than 60% of the entire world population. In fact this geographical region itself accounted for approximately 21% of the sales of the company in 2017. Hong Kong in this regard is a very strong market and so is Australia. Another notable success story in this context has been in China where operations were first established in 1993 and further on Estee Lauder was able to establish itself as a market leader in China by 2002. One of the reasons why distribution has been their strength is their ability to understand the pulse of the local markets. For instance so as to customize their products better for the Asian market Estee Lauder introduced a R&D team in Shanghai in 2005 and further established a centre exclusively for R&D to cater products for Asia specific needs and demands.

4. Product Quality & Superior Marketing Techniques: As a part of the basic brand essence, product quality has been the driving factor for Estee Lauder. In fact the brand founder herself, started the brand based on her obsession for well groomed skin and shining eyes and always emphasized on the best quality. In fact at a time when sampling of a new brand was unheard of Estee Lauder employed this technique to test out the brand during its inception days to acquire customers for the long term instead of short term acquisitions through wide spread advertising. The brand, also introduced during its run like endorsements by celebrities, bundling, promotional bills, gift products with purchases, use of avenues like department stores and most importantly educating the customer through product demonstrations. These demonstrations were through makeovers, done in single sessions, instant makeovers that contributed to widespread brand visibility. These techniques were all revolutionary in their time, and this legacy of innovative marketing coupled with high level product quality has continuously kept this brand at the top.


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This section is available only in the 'Complete Report' on purchase.


This section is available only in the 'Complete Report' on purchase.

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Estee Lauder SWOT and PESTLE analysis has been conducted by Neelabjo Mukherjee and reviewed by senior analysts from Barakaat Consulting.

Copyright of Estee Lauder SWOT and PESTLE Analysis is the property of Barakaat Consulting. Please refer to the Terms and Conditions and Disclaimer for usage guidelines.

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