Ow can a company like the Estee Lauder Group satisfy consumers globally while sustaining a luxurious image through effective strategic management?



Definition of global expansion along with benefits:
- Gain global market share
- Increase sales & profit
- Extend the sales on potential of existing products
However, the challenges that come with global expansion are just as important. Therefore it is primordial to implement an efficient and thought out strategic management.

Estee Lauder targets a very specific niche of customers and has a luxurious reputation to maintain. If the international business plan is not appropriate, globally expanding will be challenging. The main challenges will be to implement and organise a firm presence to new regions and therefore, new markets.


Made of 3 different sections:

SECTION 1: Estee Lauder: a functional domestic structure.

1- Internal Analysis and External Analysis:
- History of the company (Salon brands branch: Aveda, Bumble and bumble)
- Vision, Mission, Objectives
- Macroenvironment, Microenvironment

2- Strategic Analysis:
Means for Objectives
Resources for Objectives

Key dimensions of the organisational structure:
a) Specialisation: matching activities with the people who are best able to perform them at all levels of the organization
b) Standardisation: practices, procedures and guidelines that provide the basis for consistent performance a achieving order within the structure
c) Centralisation: delegation of authority throughout the organisationas rank

3- Competitive Strategy:
a? Product Development
a? Market development
a? Diversification / Differentiation
a? Customization
a? Eco-friendly company with environmental sustainability. Ethics and social responsibility
a) Pollution prevention
b) New Environmental Technology
c) Sustainable Vision
CCL: Estee Lauder Salon Brands is a challenger in the cosmetics area but a leader in the eco / natural cosmetics area. Therefore it is a natural decision to globally expand. However, with all the new opportunities and benefits comes a considerable amount of challenges.

SECTION 2: Global Expansion: a difficult process. The short-term challenge will be implementing a new region. NA a ?GLOBAL a  EMEA

1New Market Analysis:
- History of Aveda and Bumble and bumble globally expanding
- New regionas Marketing Environment:
a) Microenvironment
b) Macroenvironment

- Global expansion through Trans-national Strategy:
a) Distinctive competences to foreign markets
b) Exploits experience curve effects
c) Exploits location economies (new market)
d) Customised products
e) Benefits global learning
a) Difficult to organize
b) Difficult to implement
(Very specific service / product. Will it appeal to all markets / cultures etc?)
2Implementation of new strategic management:
Shift from a:
a? Functional structure
To an:
a? International division structure

3Main challenges encountered:
- Short term
- Long term
(Artwork, translations, approvals, events, visual merchandising, press coverage, prices a¦) a?EMEA considered as an extra state by the USAa?

CCL: Challenges are not only present in the communication between global and international, but also within the international department. Therefore it is crucial for:
- Global to create new projects with the EMEA region in mind
- The strategic management within the EMEA region is focused on satisfying this new range of consumers. (Customisation?)

SECTION 3: Global expansion: a constant process. The long term challenge will be satisfying every new market within EMEA (short & long term). EMEA a  EACH INDIVIDUAL MARKET (UK, Germany, Italy, Benelux, Spain, Turkey, Russia)

1- Strategic Planning:
New Objectives
New Means for Objectives
New Resources for Objectives

2- Market analysis:
Market Analysis and case studies for the 2 new regions here Aveda had just launched:
a) Turkey
b) Russia

3Relationship Marketing:
a) Product (differentiation & luxury & superior quality)
b) Education (transfer of Know-how) salon is our customer but doesnat stop there. We sell through the salon. Therefore, it is in our interest to teach them to sell the product to the consumer.
c) CLEAR EXPLANATION OF PROCEDURES AND RULES to keep luxurious image a no matter the location
d) Collateral needs to be translated in all languages / culture / taste etc.


Summarise the history of the Estee Lauder Salon Brands branch. Decision made, challenges and successes. Link the importance of adapting the strategy to the structure, regions and markets.