Estee Lauder deepens commitment to China, creates CEO role
China has been elevated in importance by The Estee Lauder Companies, as the beauty giant restructures its mainland China business, opens a new innovation centre, and implements new leadership including creating its first regional CEO position.
This restructuring by the multinational maker and marketer of makeup, skincare, fragrances and haircare products, involves elevating China so that it reports directly into the international organisation and creating China’s first-ever CEO role, promoting Joy Fan to President and CEO, China.
Reflecting Estee Lauder's dedication to China and Chinese consumers, this important evolution in the company’s regional enterprise structure is set to both reinforce its focus on Asia-Pacific to realise its future business growth, and further enable the region to lead in what is an “increasingly complex and competitive beauty landscape”, Cedric Prouve, Group President, International said.
Estee Lauder expects double-digit growth in China
As one of the most dynamic markets globally for prestige beauty, China is strategically significant for Estee Lauder, as a source of deep inspiration for product development, marketing excellence and consumer insights.
According to Estee Lauder’s fourth-quarter 2021 earnings, the APAC region saw annual sales growth accelerate from 18% to 22%, driven by strong sales performance in China where net sales rose in double-digits. In particular, this was led by the continued strength of skincare, acceleration of fragrance growth, and the recovery of makeup.
“We expect the market in China to continue to grow double-digit, and we are very, very optimistic on the strength of this market, as well as on our position with the consumers in this market,” says Fabrizio Freda, president and director of Estee Lauder Companies.
The company has seen dramatic growth on platforms like Tmall, and in July 2021, unveiled its brands on Chinese ecommerce platform JD.com, hoping to further capture the online opportunities by opening up to a new demographic. The company has also entered more cities with its offline offerings, reaching 145 to date.
Elevating China and creating CEO role
Believing in the long-term growth fundamentals in the market, Estee Lauder is deepening therefore its commitment to China.
By elevating its China business, so it reports directly into the global organisation and has its own executive leadership team, the company will enable increased speed, local decision-making, and global collaboration to advance its leadership and to successfully deliver high-quality products and services for the Chinese consumer.
As part of this focus on China, Estee Lauder has created the region’s first CEO position providing China with its own executive leadership. Joy Fan will assume the new role of President and CEO China, overseeing the mainland China business, effective February 2022.
Having joined Estee Lauder APAC in 2012, as leader of the China affiliate of the business, Fan has worked with her team for the last nine years to successfully drive growth within the market, as well as to elevate the understanding of the Chinese consumer across the enterprise.
She spearheaded the direct-to-consumer strategy in China which resulted in the growth of multiple brands in the group’s portfolio and development of key channels, and under her tenure, the China affiliate has grown into an industry leader in social media and marketing. She leveraged innovation to recruit and retain new, younger consumers, and successfully pivoted during the pandemic to address the changing distribution landscape and evolving consumer preferences to rapidly return the business to positive growth.
Described by Estee Lauder Companies as a visionary executive and one of the most respected leaders in the business, Fan has deep expertise of China, especially of consumer preferences, along with a global perspective and exceptional brand-building abilities, making her the perfect choice of CEO for China.
In her new role, Fan will continue to be responsible for the company’s long-term growth strategy for China and its vision of the Chinese consumer.
Opening of new China Innovation Center in Shanghai
Underlying its commitment to China, the company is further expanding its scientific presence in the country recently opening its new China Innovation Centre in Shanghai.
A first of its kind for the company, this world-class innovation centre will “create a unique opportunity to grow and build on our market and consumer insights to develop exceptional products to meet and surpass the needs and desires of Chinese consumers”, says Freda, adding too that it will enrich “our capability in product design, formulation, consumer insight and trend analytics for Chinese and Asian consumers”.
This, along with the company’s scientific investments in China, are expected to support and inspire the development of the entire prestige beauty industry worldwide, enabling truly localised innovation.
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