Estée Lauder CEO Details Strategy to Boost Indie Brand Growth Amid The Ordinary’s Near-$1 Billion Milestone
How Does Estée Lauder Support Indie Brands Without Stifling Their Identity?
Estée Lauder Companies CEO Stéphane de la Faverie outlined a new approach to accelerate performance of acquired indie beauty brands during a presentation at the Barclays Global Consumer Conference on September 9. He noted that The Ordinary, the company’s high-growth skincare brand, is approaching $1 billion in annual sales, underscoring the potential of its portfolio when supported effectively. The strategy focuses on preserving brand autonomy while providing targeted resources to scale operations and innovation.
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The Secret to a Flawless Autumn Complexion is Sunscreen LayeringThe new model emphasizes operational independence for acquired brands, allowing them to maintain their distinct identities and entrepreneurial spirit. De la Faverie explained that Estée Lauder acts as a growth partner rather than a controlling force, offering access to global supply chains, marketing expertise, and retail networks without imposing rigid corporate structures. This balance aims to prevent the common pitfall of indie brands losing their edge after acquisition by larger corporations.
What Risks Come With Rapid Growth for Acquired Beauty Labels?
The company avoids integrating acquired brands into its traditional beauty divisions, instead keeping them as standalone units with dedicated leadership. This structure enables faster decision-making and closer alignment with consumer trends. De la Faverie cited The Ordinary’s success as proof that minimal interference, combined with strategic backing, can drive exceptional results. The brand’s disruptive pricing and ingredient transparency have resonated strongly with younger, value-conscious shoppers.
Despite the upside, de la Faverie acknowledged challenges in sustaining momentum as brands scale. Maintaining product authenticity and avoiding over-commercialization are key concerns. Estée Lauder mitigates these by investing in research and development tailored to each brand’s ethos and by monitoring consumer feedback closely. The goal is to grow revenue without diluting the core appeal that made the brands attractive in the first place.
How close is The Ordinary to reaching $1 billion in annual sales? According to Stéphane de la Faverie, The Ordinary is nearing $1 billion in annual sales, reflecting its strong performance since acquisition by Estée Lauder Companies.
Frequently Asked Questions
What defines Estée Lauder’s new strategy for indie brands? The strategy centers on granting operational independence while providing access to global resources like distribution, marketing, and R&D, allowing brands to grow without losing their unique identity.
Why does Estée Lauder avoid integrating indie brands into its main divisions? Keeping acquired brands as separate units preserves their agility and entrepreneurial culture, which de la Faverie believes is essential to sustaining innovation and consumer trust.