Esteé Lauder started formulating her skincare products in her kitchen in the 1930s and today, according to Forbes, the Esteé Lauder Companies Inc. is worth $1.2 billion, generating sales of $21.63 billion in 2019 and has successfully expanded globally with over 25 brands under its wings including MAC Cosmetics, Jo Malone and Clinique. This is what you can learn from Esteé Lauder on how to build a business to an empire:
- Word-of-mouth is important
When Esteé Lauder had perfected her skincare formulation, she started selling them at hair salon and gave her potential customers live demonstration. From this live experience, her customers began telling all their peers about the product and from there, her reputation started to blossom. According to research 78% of customers believe in peer recommendations rather than advertisements. This is why word-of-mouth is one of the most important tools in marketing your products. One way you could do it in today’s digital age is by working with influencers that share the same values as your brand.
2. Know your market
From the start, Esteé Lauder had always sold her products to affluent women who could afford the luxury of skincare. Even when she started selling at department stores, she would only sell her products at high-end stores in order to stick to her target market. This was proven to be successful as her products were sold out within two days of selling at Saks Fifth Avenue department store. This shows how important it is to always know your market and cater to their needs to keep sales and brand equity up.
3. Innovation is key
Esteé Lauder believed in always knowing what her customers wanted in a skincare product and would continuously innovate accordingly. This distinguished her from the other players in the industry such as Revlon and Elizabeth Arden who were big at the time. She was also very innovative in marketing her products by being one of the first companies to give samples to her customets. Innovation lies, not just in product development, but also in marketing. Find a way to intrigue your potential customers that is different from anyone else in the industry.
Although starting a business now is so much more difficult as compared to when Esteé Lauder started hers, there are always lessons we can learn from her that we can apply today. When building a business, it’s always good to go back to the basic of entrepreneurship.