Skincare has proved to be the major weapon in Estée Lauder’s arsenal once more, propelled by Clinique, La Mer, the core Estée Lauder brand and Dr Jart+. The multinational also expanded its skincare portfolio by increasing its stake in Deciem, the maker of The Ordinary, to 76 per cent with the deal closing this month.
According to Lookfantastic.com.au, the premium online beauty website, The Ordinary topped its search list in Australia over the past 12 months with 1.4 million searches.
Net sales for the Estée Lauder Companies (ELC) reached US$3.86 billion in its Q3 2021 – a 16 per cent uptick year-on-year from US$3.35 billion over the same period in 2020.
Every major geographic region recorded growth in the third quarter, with the Asia/Pacific posting the biggest rise. Q3 skincare sales worldwide surged 31 per cent to US$2.25 billion. Fragrance also saw double-digit growth of 30 per cent to US$454 million, fuelled by Tom Ford, Jo Malone, Kilian Paris and new launches from Estée Lauder.
Makeup remained stuck in the slow lane, with sales dipping 11 per cent to just under US$1 billion.
But, like L’Oréal, Fabrizio Freda, President and CEO of Estée Lauder, is predicting a “makeup renaissance”. Countries which are further along in their pandemic recovery such as Australia, China and Israel, are expected to lead the way in the multinational’s colour cosmetics resurgence.
Online sales also continued to shine with double-digit growth, as did travel retail boosted by Mainland China’s domestic travel upsurge. ELC recently shuttered the Becca makeup brand and the luxury skincare player, Rodin Olio Lusso, to concentrate on its core business. Hero products and franchises such as Advanced Night Repair and DayWear from Estée Lauder, Clinique’s Moisture Surge and La Mer have proved a solid bedrock to the company’s recovery strategy.
We exceeded our sales and earnings expectations as several markets experienced increasing pressure from Covid-19 throughout the quarter, adds Freda. “Our growth engines of skincare and fragrances were incredibly powerful. Sales rose in every region, led by double-digit growth in Asia/Pacific. Estée Lauder, La Mer, Jo Malone, Clinique and Tom Ford Beauty led the robust performance of many brands in our portfolio.”
Boosted by its third quarter performance, ELC has predicted between 11 to 12 per cent net sales growth for its current fiscal year compared to last year.