• Inside Labour

    The 'casualisation' of the workforce is often a ploy to cut costs, says Terry Bell.

  • When drones go dancing

    Drone technology's future is about to come to life in Cape Town, says Arthur Goldstuck.

  • Testing times for Matona

    New Eskom CEO Tshediso Matona has his work out cut out for him, says Mzwandile Jacks.

Data provided by iNet BFA
Loading...
See More

Estee Lauder eyes buoyant Africa demand

Aug 01 2013 09:24 Reuters

(Shutterstock)

Related Articles

H&M to launch a store in SA - report

Former M&S clothing boss quits ASOS

Marks & Spencer clothing sales fall

Africa beckons for SA retail investors

Tesco clothing brand to go global

Benetton to sign Bangladesh safety pact

 
Johannesburg - Estee Lauder plans to expand its presence in sub-Saharan Africa by rolling out its $1bn brands, Clinique and MAC, to tap into strong demand for luxury cosmetics among the region's middle class, a company executive said on Wednesday.

The high end cosmetics company will introduce Clinique, its second-biggest brand with sales over $1bn, in Nigeria this year and in Mozambique in the near future, Sue Fox, Estee Lauder's managing director for sub-Saharan Africa, told Reuters in an interview.

It launched MAC makeup in Nigeria's largest city Lagos in February after being "inundated" with requests and will be opening another store there within weeks, Fox said.

"There's massive interest from the consumers there in international brands," she said. "We're very excited about the potential of MAC in Nigeria. That's led us to pursue a strategy with MAC that will ensure that we're able to bring the brand to consumers in other markets."

The company has earmarked a second new market for MAC, its third-biggest brand, this year and another two or three in 2014, adding to new partner stores in Botswana and Zambia.

It is also about to enter Cote d'Ivoire for the first time with fragrances, currently its biggest category in Africa. Estee Lauder's partners in designer fragrances include Tom Ford, Michael Kors Holdings and Coach.

Fox said Estee Lauder views sub-Saharan Africa as "a long-term build", citing its youthful population, brisk economic growth and urbanisation. The region, with the exception of South Africa, is its newest market.

"The potential of Africa, we believe, is extremely positive and we wouldn't be entering unless we believe that there was long term sustainable growth," she said.

"Our target consumer is the emerging middle class, the established middle class and that affluent African consumer who's probably extremely well travelled and very brand savvy."

However, the main hurdle to the company's growth in Africa is the lack of retail infrastructure outside South Africa.

"We would probably be going a lot faster if there was the availability of retail space," Fox said. "The concept of department stores doesn't really exist outside of South Africa. I think there are great opportunities for retailers and for mall developers in sub-Saharan Africa. Brands want to be there."

Estee Lauder is focusing on cities with the biggest growth potential, said Fox, and has identified key locations such as Lagos, Abuja and Port Harcourt in Nigeria, as well as the capitals of Ghana, Kenya, Tanzania, Mozambique and Angola.

Follow Fin24 on Twitter, Facebook, Google+ and Pinterest.

estee lauder  |  cosmetics
NEXT ON FIN24X

 
 
 

Read Fin24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
0 comments
Add your comment
Comment 0 characters remaining
 

Company Snapshot

We're talking about:

Small Business

Expanding your business requires capital and banks have stringent lending criteria in place.
 

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...
Loading...