Material World

In the “can’t-see-the-forest-for-the-giant-branded-oak-tree” category I’d  like to nominate luxury industry watchers (myself included), who’ve been so distracted by Burberry’s assumption of tech-guru status that we’ve overlooked what one report now believes to be the challenger to that status: Estée Lauder.

A study by think tank L2 on the “Digital IQ” of beauty brands that looks at their websites, digital marketing, social media use, m-commerce, and e-commerce shows Estée Lauder, one of the world’s oldest beauty groups, leads its rivals in exploiting the online community – for example…

Of the top 10 brands in the ranking, the leading four are owned by Lauder (MAC, Clinique, Estée Lauder and Bobbi Brown). LVMH has five brands in the top 55, while Burberry came in at 18, though this is actually a pretty impressive feat, given that it only launched a beauty range a year ago. In fact, Burberry’s success in a short space of time shows how useful a developed digital presence can be in developing a brand extension.

Maureen Mullen, L2′s head of research and advisory, attributes Lauder’s success online to two factors:

1. The launch in 2001 of a multi-brand retail store called gloss.com. Although it  closed in 2007, Ms Mullen thinks the experience positioned Lauder to take advantage of the web much faster than its competitors. 
2. The willingness to use what it learns from one brand (Clinique) for another (Smashbox, which it bought this year, and which has upped its online presence by 38 per cent since then). By contrast, she points out, Gucci’s online expertise has not translated for, say, Bottega Veneta, another PPR stablemate.

The other surprising piece of news in the report is the galvanisation of Christian Dior, which has never been considered particularly web-forward, but which launched beauty e-commerce last October and, between May-August, added almost 3.5m people to its Facebook community. That’s a lot of lipstick fans.

As to why any of this matters, well, L2 sites the following stats:

– In the first 6 months of 2011, US high-end skincare sales rose 14 per cent vis-à-vis pre-recession sales

– last year the beauty industry had emerging market growth of 25-30 per cent

– Facebook is one of the top eight drivers of traffic for 80 per cent of brands

You do the math.