Calling the results, cause to celebrate, Estée Lauder president and CEO Fabrizio Freda, notes that “we capitalized on shifting consumer preferences by leveraging our strength in makeup and positioning our Company to win in luxury fragrances.
“We nimbly allocated resources and made strategic investments in areas that gave us terrific results, including emerging markets, our makeup category, and the online and specialty-multi retail channels,” he explains in a company press release. “Importantly, we achieved these results against a backdrop of social and political instability, currency volatility and economic challenges.”
Makeup and fragrance
These categories were the winners for Estée Lauder. For the year, makeup sales rose 9% on a reported basis, 15% in constant terms. And, fragrance sales were up 5% on a reported basis and 10% in constant currency.
The growth in the makeup business came in large part from double-digit gains at MAC, Smashbox, and Tom Ford. “These sales increases resulted from new product offerings, as well as the broadening of the brands’ presence in a number of channels, including freestanding retail stores, travel retail and specialty-multi brand retailers to reach new consumers,” explains the company.
Skin and hair
Skin care had a 3% lift in sales for the year, a figure that’s down 1% in constant currency terms. Hair care was up 4%, 7% in constant terms.
La Mer skin care did well. But the company points to an industry wide decline in the category and slowing sales of Estée Lauder and Clinique skin care (especially in Hong Kong) to account for the lower numbers.
Credit for the growth in hair care goes to “recent product launches, such as Invati Men, Shampure dry shampoo and the Thickening Tonic by Aveda,” according to the company release. Aveda hair care grew in salons, travel retail, and ecommerce; while Bumble and bumble did well at specialty retail shops and thanks to “selective global expansion.”
Adjusted net sales in the Americas region were up 2% for the year. Estée Lauder credits the lift in North American sales to a selection of top selling brands: Tom Ford, Jo Malone, Smashbox, La Mer, MAC, and Bobbi Brown.
The company likely would have done even better were it not for a decline in tourism, witch Estée Lauder believes contributed to lower sales of Clinique and Estée Lauder in department stores as well as lower sales at standalone MAC boutiques.
That same brand, MAC, led sales growth in Brazil, Mexico, and the rest of Latin America. Separately, Canada saw a sales lift for the year as well.