Estee Lauder Companies - Development Strategy and Factors Increasing the Value of Products – Statistics Project Example
The paper "Estee Lauder Companies - Development Strategy and Factors Increasing the Value of Products" is a wonderful example of a statistics project on business. Estee Lauder Companies was founded in 1946 by Estee Lauder together with her husband, Joseph Lauder. When it was formed, it had four products, that is, Creme Pack, Skin Lotion, Cleansing Oil and Super Rich All Purpose Creme (Estee: Lauder-Our history, n.d.). It is one of the leading producers and marketers of cosmetics including skincare, haircare, makeup, and fragrance products, which are sold in over 150 countries (New York Times) The company accomplishes diversity through financing resources and projects to add value to its products (Guin, Allen & Semenik, 2011, p.212). This acquisition has been a success for Estee Lauder, which has an average growth of 23.30% (Market Equities). It invests in sustainable packaging and customer-driven market strategies, for example creating differentiated brands that serve all its targets, for its value proposition (GCI Magazine 2014).
Estee Lauders legal structure is as shown in Chart 1
Arrows represent where one reports to. EVP stands for Executive Vice President.
Part 2: Strategies
For the year that ended 30 June 2014, Estee Lauder Companies registered growth in net sales from $ 10.18 billion to $10.97 billion (News & Events). This shows that the sales grew by 8% from the previous year. This growth was attributed to the high sales in Skin Care, Makeup and Fragrance products. The Skin Care sales rose from $ 4465.3 million in 2013 to $ 4769.8 million in 2014. Makeup sales totaled to $4210.2 million from $3876.9 million. Fragrance products registered sales of $ 1425.0 million from the previous $1310.8 million.
The sales in Makeup products (9%) were due to the differentiated strategy of branding. Gains in Skin Care (7%) were as a result of recent launches of "Micro Essence Skin Activating Treatment Lotion" and "Advanced Night Repair Synchronized Recovery Complex 2" (News). Sales in Fragrance (9%) were attributed to Jo Malone and Tom Ford.
For the fiscal year ending 30 June 2014, Estee Lauder Companies sales in America grew by 6% from $ 4302.9 million in 2013 to $ 4572.3 million. This growth was due to the introduction of heritage and designer fragrance brands and also makeup and luxury brands.
The greatest growth was registered in Europe, the Middle East, and Africa region at 11%. The sales rose from $ 3758.7 million to $ 4163.7 million. These sales were as a result of emerging markets in Central Europe and Turkey.
Sales in Asia and the Pacific region grew by 5% from $ 2121.6 to $ 2232.7 million (News and Events, 2014). The growth through small was due to accelerated retailer orders.
Allocation and Distribution Channels
The Companies products are sold in over 150 countries with the US taking up the largest percentage at 42%. Sales in Europe accounted for 33% of the total sales, which were $ 10968.8 million. (The Estee Lauder Companies Inc). Estee Lauder Companies has limited distribution channels that complement the images for its brands. The products are sold in specialty retailer stores, upscale perfumeries, 690 single-brand stores operated by the company, salons, massage parlors, online, and in 130 multi-brand stores. These channels also include stores in cruise ships, pharmacies, and duty-free shops in cities and airports (Howerton, 2002, p.9). There is also a line of freestanding retail stores for Origins, M.A.C and Aveda products.