We want to promote beauty entrepreneurship in India: Estee Lauder CEO

ELC President and CEO Stephane de La Faverie talks about how they are fostering entrepreneurship in India's rapidly expanding beauty market

American cosmetics firm, The Estée Lauder Companies (ELC), established a partnership with the Startup India initiative through a memorandum of understanding with the Department for Promotion of Industry and Internal Trade (DPIIT) on Wednesday. ELC President and CEO Stéphane de La Faverie tells Veenu Sandhu in an interview in New Delhi how they are fostering entrepreneurship in India’s rapidly expanding beauty market, navigating trade uncertainties, and leveraging artificial intelligence (AI). Edited excerpts:

 

Can you give some details of the MoU signed today?

 

In October, during my last visit, we hosted a Beauty & You event where we received over 1,000 applications; 68 per cent of them were from women. We wanted to scale up this support. We will provide grants to selected entrepreneurs to help them grow their beauty businesses. We will also provide mentorship, sharing insights we’ve gained over our 77-year legacy in beauty. This guidance covers everything, from product distribution to pricing, category strategies, and understanding consumer needs.

 

What are your plans in India?

 

We’ve been in India for 20 years, and are today the leaders in prestige beauty in the country. India continues to be one of the fastest-growing markets globally, and we see tremendous opportunities with the rise of the middle class.

 

Our strategy covers all major beauty categories: Skincare, makeup, and hair care. We are constantly working to offer locally relevant products while maintaining global quality standards. For instance, we designed a 24-hour kajal line specifically for Indian consumers. Similarly, we recently designed and launched – in less than eight months – a luxury lipstick with glitter tailored for the opulent Indian wedding. 

 

What is your pricing strategy for a price-sensitive market like India?

 

We offer a diverse portfolio at different price points. In India, we have 14 brands, including The Ordinary, Clinique, and MAC, which are our entry-level prestige brands. We recently launched a successful skincare brand in India at an affordable starting price of Rs 670-700.

 

We also create mini sizes for some of our premium products, like our Estee Lauder Advanced Night Repair serum and Double Wear foundation, priced at around $16 (about Rs 1,300). This allows us to cater to consumers entering the prestige beauty space. Our strategy is to guide consumers from mass to prestige and then from prestige to luxury as their purchasing power increases.

 

Are you planning to manufacture locally in India?

 

While we have manufacturing plants in the US, UK, Europe, and Japan, we recently launched our first "Made in India" product — a lipstick tailored for Indian weddings — which has been very well received. We plan to expand production in India by working with local partners to better meet consumer demand.

 

How significant is the Indian market for Estee Lauder globally?

 

India is classified as an emerging market for us, yet it’s one of the fastest-growing beauty markets in the world. According to Euromonitor data, prestige beauty accounts for less than 10 per cent of the overall beauty market in India, but it's growing faster than the mass segment.

 

With global trade uncertainties and tariff threats by US President Donald Trump, how are you managing potential impacts on your supply chain?

 

We have a diversified manufacturing network across the world, which allows us to adjust production levels to respond to market conditions. While our decision to manufacture locally in India [currently at Dehradun] was not driven by trade policies, it has become an asset in ensuring we can meet consumer demand quickly. Diversifying our supply chain has always been part of our strategy, ensuring resilience during volatile periods such as the disruptions seen during Covid-19.

 

How are you reaching consumers in smaller cities?

 

Today, we have about 300 points of contact across 45 cities in India. Additionally, through online platforms, we are able to deliver our products to over 19,000 pin codes. This enables us to reach consumers in smaller towns like Shillong, Visakhapatnam, and remote parts of Kerala within 48 to 72 hours.

 

You’ve talked about minority investments in India.

 

We have a dedicated group called New Incubation Ventures (NIV) that invests in small, emerging brands. In 2008, we invested in Forest Essentials, which at the time had just two points of sale. Today, Forest Essentials has over 170 stores across India.

 

Our minority investments allow us to provide strategic guidance to these brands, helping them with product development, distribution, and even expansion to international markets. For example, Forest Essentials is now present in West Asia and the UK, and we expect further growth in the future.

 

How is Estée Lauder integrating AI into its operations?

 

We've committed to embedding AI into everything we do. For instance, we've enhanced our supply chain with AI, allowing us to better predict inventory needs and improve forecast accuracy using millions of data points.

 

We've also partnered with Microsoft to create two proprietary AI tools: Consumer IQ and Trend Studio. Consumer IQ leverages data from our 77-year history to provide insights into consumer behaviour, while Trend Studio identifies emerging trends worldwide. These tools work together to match trends with the right products or create new offerings quickly and efficiently.

 

Additionally, AI supports our creative processes. It helps us tailor product imagery and marketing content for different regions, ensuring relevance for diverse audiences. This ensures we can present our products in locally meaningful ways while maintaining speed and efficiency.

 

Any collaborations planned in India?

 

One standout collaboration was with Sabyasachi Mukherjee, one of India's most beloved designers. Together, we created an exclusive line of lipsticks that reflected his signature aesthetic while incorporating our product expertise. This collaboration featured 10 shades, including 'Calcutta Red,' designed to resonate with Indian consumers. 

 

We have also collaborated with local artists. Additionally, we've been working with Indian celebrities for nearly a decade, such as Manushi Chhillar (the first Indian woman to become ELC’s global brand ambassador). There will be more collaborations.

 

The biggest challenges for the beauty industry in India?

 

Rather than challenges, I see excitement. The beauty industry is constantly evolving, and social media has significantly accelerated this change. Consumers are more informed than ever, and brands need to stay agile to meet their evolving expectations.

 

Our 'Beauty Reimagined' strategy is focused on becoming the most consumer-centric beauty company in the world. We're transforming our company to be more agile, faster, and leaner, while investing in locally relevant innovations. Sometimes that means partnering with local producers or working with Indian startups to ensure our offerings remain valuable to Indian consumers.

 

Any beauty product from your line that you use and swear by?

 

Quite a few! While I may skip the lipstick, I swear by Cypress and Grapevine by Jo Malone London. I'm also a big fan of La Mer products. After shaving, I use a treatment lotion to soothe my skin, followed by a serum — sometimes from The Ordinary, sometimes from Estee Lauder. I finish with Crème de la Mer for moisture. For fragrance, I like to mix several of our scents to create my own personal blend.