Estée Lauder [NYSE:EL], once a leader in the beauty industry, is grappling with a severe downturn, as its stock has plunged to levels last seen in 2017. Shares are in a steady decline. Having traded at over USD 350 at the end of 2021, they have consistently coughed up value ever since, sliding down to USD 90 at time of writing.
The company has also witnessed a significant leadership shake-up, with CEOs being replaced and several senior leaders following suit, as management has tried to turn things around. But where did it all go wrong for the beauty giant?
We spoke to Colin McKenzie, Chief Client Officer at brand management specialist Gradient, who shed light on the situation, pointing to a critical oversight in Estée Lauder’s strategy.
“This decline may be traced back to the brand’s lack of investment in experiential marketing,” says McKenzie. “To put this into perspective, L’Oreal shares have increased 39.27% over the past quarter.”
Where is L'Oreal getting it right?
L’Oreal and Estée Lauder, both giants in the beauty industry, are now worlds apart in their market performance. L’Oreal’s revenue soared to $44.6 billion in 2023, whereas Estée Lauder’s was just $15.9 billion. But the difference extends far beyond revenue figures.
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