William Lauder
The Building of a BrandFIPP World Magazine CongressMay 24, 2005New York, NY
Thank you, Tom.
I am delighted to be here for many PROFESSIONAL reasons.
But also for one very PERSONAL reason.
The professional reasons must be obvious. This is an enormous gathering of many of the most valued business allies we have.
The personal reason may be less obvious -- You see I usually meet with publishers and editors one-on-one over long lunches.
So with about 650 of you in this room this morning,I am saving 1,300 hours and literally millions of calories. My calendar and my waistline thank you very much.
Our industries have always had a symbiotic relationship and many shared attributes.
My agenda this morning is to discuss two common themes –
• First, our mutual business challenge; Although our products are very different, we have many of the same challenging circumstances
And
• Secondly, our mutual brand building opportunity.
But, before I begin, I hope you will permit me to give a little sales pitch about our Company
I am the son and grandson of world-class salespeople. They would never forgive me if I didn’t take advantage of this very special captive audience.
We are:
• 23 brands (including our most recent, Missoni - announced last week)
• Operating in 130 Countries
• With four product categories:
• Makeup
• Skincare
• Fragrance
• Haircare AND
We’ve enjoyed 52 years of uninterrupted growth.
I want to thank you – our publishing and editing friends – who have been incredibly supportive and essential to our success
Not every one of our23 brands advertise, but several do and I want to update you on some of our most recent creative images.
(Shows images)
This is an iconic ad featuring 3 of our spokeswomen: Liya Kebede, Elizabeth Hurley and Carolyn Murphy for the Estee Lauder brand.
Our famous product as hero ads.
American Beauty
This iconic ad for our new Beauty Bank brand American Beauty features Ashley Judd.
This is an ad for Be Delicious, an incredibly successful DKNY fragrance success was driven in part by its frequently run effective print ads.
We are very proud of our advertisements and believe they look great in your magazines
(especially in the best positions)
Now, let’s turn to that challenge we share–
Like you, we compete in a world with many brands and tons of new products.
In 2004 we launched nearly 5,000 new products and you launched 75 new magazines EACH month!
Brand distinction is narrower and narrower these days.
Like you, we are competing in a limited distribution scenario.
We also share a tremendous opportunity to build brands together.
We believe that your magazines do more than sell product.
You forge emotional bonds with your readers. We also do more than sell product. We create beauty and self esteem for our consumers.
Together we form a virtuous cycle. Our advertisements enhance your magazines and your magazines are the authority that drives the consumer.
I want to share with you, how we think about the magazines.
All categories are analyzed and reviewed based on a brand’s goals and objectives. Selected publications are then further analyzed in two ways:
Of course, we look Demographically –the basics –circulation, median age, median household income, circulation stability, newsstand vitality, percent male/female and so forth.
However, the much more important element is the book’s psychographic profile – it’s voice if you will. The qualities that make a publication unique and define its personality.
Understanding the essence of a publication goes hand in hand with the deep understanding of a brand.
It is knowing the qualities of both and how they will mesh that will drive a successful plan.
Now, let me share with you how these psychographics play out over a combination of titles many key categories:
Beauty/Fashion is our bread and butter.
An editor’s endorsement is vital to create a demand for our product. Your magazines drive newness.
As nearly one third of our revenue comes from new products, your authority in this area is vital to us.
Lifestyle/Special interest
We have seen an explosion in this category. These lifestyle magazines tapped into a real thirst among women 30 years and older who are not readers of the beauty/fashion category.
These books have enormous circulation and put us in touch with a reader that we didn’t reach previously.
The mega-magazines with super reach are the workhorses of our plan. These magazines, with circulations way above 2 million are sales machines. No media plan can ignore these powerful books.
We think of the entertainment category as the buzz-builder. Being connected with these books hypes your product.
As the Estee Lauder Companies becomes more associated with more celebrities Beyonce, Enrique Iglesias, Sean Combs, and the just announced relationship with Gwyneth Paltrow for Estee Lauder brand fragrances this category becomes more important.
We all know the power of celebrity and how it influences purchasing decisions. As magazine experts you know the power of a celebrity on your cover and how it moves sales.
Let me show you what I mean with three examples
First, take a look at our Estee Lauder fragrance “pleasures.” It is a popular fragrance, but not a new brand. This 10 year old fragrance needed to stimulate growth while maintaining awareness.
We first launched Pleasures in the beauty/fashion category. Then we reached out to a broader audience with the lifestyle magazines.
Some of our ad placement choices included:
• REDBOOK
• REAL SIMPLE
• OPRAH
Second, consider the launch of our new fragrance True Star with Beyonce. This fragrance appeals to a woman’s sense of fashion focusing on celebrity.
We selected COSMOPOLITAN – a publication for young women who want to live passionately – the fun, fearless female.
• ESSENCE -- to reach African American women with
inspiration, enlightenment and empowerment.
• ENTERTAINMENT WEEKLY to be associated with all
areas of the entertainment industry including music, movies
and theater.
• IN STYLE – the insider’s guide to celebrity and trends.
Here we chose a very wide combination of titles to reflect the broad appeal of this celebrity based fragrance.
My final example is MAC’s Viva Glam. As you can see from this ad, MAC is a highly unique brand.
Our objective is to create awareness and excitement for a stylized, celebrity anchored brand using a combination of magazine brands.
Our ads ran in
• VANITY FAIR – the source book on modern culture
• INTERVIEW – which combines art, celebrity and culture in
a modern, avant garde way, and
• VIBE—written from a multi-cultural viewpoint – focuses on the personalities that shape the entertainment, fashion and political world.
With this trio of magazines we achieved the edgy, alternative feel so vital to this brand.
Those examples were brand builders. Let me give you one example of a product push. A special sample size Magnascopic mascara was developed for the joint promotion with select Marie Claire publications globally.
The Magnascopic mascara sample was attached to the magazine.
Globally the sampling was incredibly successful with a high rate of purchase of Magnascopic at counter directly resulting from this effort.
As a result, the decision was made to do packette sampling of foundations using a similar strategy.
The take away: Tie-up with one publication with global reach and conduct the promotion in numerous markets globally
In conclusion, I hope you can sense of how bullish we are on magazines. We hear a lot of skepticism among marketers toward traditional media and the dollar shifting into on-line media, email marketing and other non-traditional communications vehicles.
Sure we try new things, to be competitive we must. But these non-traditional media will never replace the power of magazines.
So long as the consumers rely on magazines for their authority so will we!
I learn a lot from the women in my life. My daughters are the first generation to grow up surrounded by digital media. They Google, they Tivo, they IM, and they love their magazines:
Teen Vogue Star and Cosmo Girl
I also believe my grandmother was right when she said the best way to sell a new product is
• Telephone • Telegraph • Tell-a-woman
Your magazines are a fabulous way to Tell-a-woman! I consider so many people in this room Friends of the Estée Lauder Companies. The Estée Lauder Family, and me.
Thank you
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