The investment news comes quickly on the heels of reports that The Estée Lauder Companies is discontinuing its skin care and color cosmetics line known as The Estée Edit, which began selling at Sephora barely over one year ago in March 2016.
The Estée Edit was a targeted effort to build loyalty with millennial consumers. And in a statement to WWD about the company’s decision to shutter the brand, The Estée Lauder Companies emphasize that they are reaching that prized consumer group through other channels: “Estée Lauder created The Estée Edit collection for Sephora to recruit millennial consumers. Simultaneous efforts by the core Estée Lauder brand have recruited millennials via digital and make-up at an unprecedented rate. Therefore, after a year of valuable insights and learnings, we have decided that a separate brand in North America dedicated to recruiting millennials is no longer necessary. We are committed to our partnership with Sephora and we are working closely to strengthen our business in Sephora and develop exciting new programs.”
The abnormal company
DECIEM has its corporate offices in Toronto, Ontario. The company got its start there in 2013. Brandon Truaxe founded DECIEM and now serves as co-CEO alongside Nicola Kilner.
Only 10 of the company’s named brands have launched so far, but others are listed on the site and according to the about page “are still waiting impatiently to be born.” Active brands include the skin care line known as The Ordinary, NIOD a skin care collection focused on anti-aging or age-slowing ingredients, Hylamide, The Chemistry Brand, and Stemm.
The media release announcing the investment points out that “with a vibrant following among millennials and diverse consumers seeking ‘functional beauty’ grounded in science, DECIEM offers a broad range of products across price points through its own multi-brand stores, department stores, e-commerce, TV shopping networks and select retailers, primarily in the U.S., U.K., and Canada.”
The terms of the investment deal between Estée and DECIEM have not been made public.
The new normal
“In four short years, Brandon and Nicola have established, in DECIEM, a powerful engine of innovation and growth,” notes Fabrizio Freda, president and CEO of The Estée Lauder Companies, in a media release about the investment.
Freda goes on to explain further why the investment makes sense for Estée Lauder at this time: “Through its unique business model, DECIEM has produced some of the most creative independent brands on the market, capturing the passion and trust of devoted fans around the world – and they are just getting started. We look forward to engaging with the team and supporting their global growth aspirations.”
From one angle the deal can be seen as incongruous. “It’s nearly unthinkable for a conglomerate to embrace a disruptive mindset like that of DECIEM,” claims Truaxe.
But it’s become quite common for large beauty and personal care companies to draw on the entrepreneurial spirit of startups and partner with indie brands in manifold ways. This new partnership between Estée and DECIEM fits that current model: “We have felt like family from the very first day we met the loving team at The Estée Lauder Companies,” Truaxe tells the press. “I am so truly honored, humbled, excited and emotional to have the support of such a remarkable partner on our path to driving innovation in beauty.”