In the midst of taking Estée Lauder public in 1995, Leonard Lauder, the company’s then-chairman and chief executive officer, fielded a question from an investment banker during the roadshow. “If your products are so good,” the banker asked Lauder, then in his 60s, “why do you have so many lines on your face?”
Fortunately, Lauder writes in his new book The Company I Keep: My Life In Beauty (Harper Collins, Nov. 17; $32.50), “my wrinkles didn’t deter investors.” His comeback came in the stock’s debut. It opened at $26 a share and climbed to $34.50 in its first day of trading.
Lauder hasn’t quite written an autobiography; there isn’t much discussion of his personal life, friends, travels, or lifestyle. Most of the names you’ll find in the book are hardworking employees whom Lauder singles out for praise, various industry competitors, and luminaries with whom Lauder has collaborated in various industries.
Aside from his mother, father, first wife Evelyn, and second wife Judy, even Lauder’s relatives don’t get much print. Of his younger son Gary, who chose not to join the family business, Lauder writes that “Gary has a dedicated sense of philanthropy and doing his own thing” and leaves it at that.
But Lauder’s niceness, sphinx-like as it might read, doesn’t detract from one of the most dazzling corporate success stories in the history of the United States.
In that respect, My Life In Beauty is basically a business book. It details how Lauder’s mother Estée (actually, Josephine, until she changed her name to match her company’s) started a cosmetics company with nothing but chutzpah and a “Super Rich All-Purpose Creme,” and how Lauder then built it into a roughly $89 billion company with 25 brands and approximately 1,600 freestanding retail stores in around 150 countries.
Start at the Top
When Estée Lauder started out, the American cosmetics industry was dominated by Elizabeth Arden, Helena Rubinstein, Charles of the Ritz, and Revlon.
Estée managed to succeed in an already crowded field, Lauder writes, by combining a personal touch (literally—her signature move was to massage the lotion onto women’s faces) with a strategy to side-step, rather than confront, her larger competitors.
“My mother was determined to carve out her own niche and create a unique power base,” he writes. The niche she chose was luxury, and the power base would be select specialty stores such as Detroit’s Himelhoch’s department store, Sakowitz & Co. in Houston, and eventually, Saks Fifth Avenue in New York.
“Their customers had the means to buy premium-priced products,” Lauder explains, and “the stores provided a sophisticated setting that would immediately burnish my mother’s brand.”