Estee Lauder 2008 Annual Report Download - page 8

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MULTI-NATIONAL SCOPE
Our growth in 2008 was powered to a large extent by our international business. Nearly
60 percent of our total sales came from outside the United States this year, with our strongest
gains coming from emerging markets such as China, Russia, Latin America, Eastern Europe
and the Middle East. Both China and Russia, for example, exceeded $100 million in sales for
the fi rst time. We also made progress in more established markets, as the European region
topped the $3 billion sales mark.
Whatever the local language, our brands speak to the aspirations of millions of global consumers .
In India, where we see immense potential, Estée Lauder and Clinique both opened stores in
fi scal 2008, becoming our fi fth and sixth brands in the country. We purchased a stake in Forest
Essentials, a prestige Indian beauty brand based on ancient naturalistic Ayurvedic principles, to
gain a greater understanding of Indian beauty traditions.
We are rolling out our brands in other promising international markets at a steady pace, as our
insights into consumers’ desires translate into exciting new products and new markets. M.A.C
has expanded to Korea and Indonesia, for example, while La Mer has opened in Russia and
Dubai, and Bobbi Brown will soon be in Russia.
MULTI-CHANNEL OPPORTUNITY
As consumers exercise their ability to shop when, where and how they want, new channels of
distribution are becoming increasingly important to us. Our online sales grew 40 percent this
past fi scal year, with particularly strong performances by La Mer, Estée Lauder, Aveda and Jo
Malone. Direct response TV is another exciting shopping venue where many of our brands
have been smash hits—including Clinique, Origins, Bobbi Brown and Ojon.
The growth in our travel retail business also has been robust, with sales soaring approximately
20 percent this year as our brands expanded in airport locations including Bangkok, Buenos
Aires, London, Moscow, Paris, Seoul, Singapore and Tel Aviv.
Increasingly, our brands are sold in retail locations beyond traditional department stores.
Our 577 single-brand, freestanding stores worldwide are showcases for brands such as
M.A.C, Aveda, Origins, Jo Malone and Estée Lauder. Darphin has been a pioneer in spas in
Europe and, recently, Asia. Origins’ Dr. Andrew Weil integrative wellness-based products have
launched in European pharmacies.
We continue to nurture our traditional department store channel by creating innovative
programs designed to bring consumers to our counters. Globally, department stores still
account for more than 50 percent of our net sales.
BeautyBank, our entrepreneurial think tank dedicated to developing new brands and products
for consumers shopping outside the traditional department store channel, is leading the way
in leveraging the power of new distribution points. Following strong sales in the U.S.-based