Kline Assesses Estée Lauder’s Investment in India's Top Spa Brand
-- Stake in Forest Essentials Opens Doors in Spa and Specialty Channels, Bolsters Naturals Focus in Lauder's Portfolio --
LITTLE FALLS, NJ, July 28, 2008 – Estée Lauder’s acquisition of a minority share in India-based spa products marketer Forest Essentials has not only landed the cosmetics giant a stake in the country's biggest selling spa brand, it may also pave the way for Forest Essentials to expand globally, according to analysts at worldwide consulting and research firm Kline & Company. Kline’s consultants predict the move could spur future expansion in Lauder's specialty retail strategy to capture a bigger piece of the $6.3 billion personal care market in India.
“Forest Essentials is the top spa brand in the country and is very strong in the ultra-luxury resort and hotel channel with its small amenities packaging,” said Carrie Mellage, director of the Consumer Products practice for Kline’s market research group. “The brand targets wealthy international travelers, and this has already gained it some worldwide exposure because guests use the products at the resort and then purchase them for home use.”
Even though Lauder acquired only a minority share, the move could be quite lucrative for both companies. While Estée Lauder gains a foothold with this well-positioned and growing brand, Forest Essentials can tap Lauder's vast marketing resources to explore opportunities outside its home country.
According to Kline's Professional Skin Care 2007: India Market Analysis and Opportunities report, Forest Essentials holds an 18.4% share in the burgeoning Indian spa market, which is expected to grow by more than 13% annually through 2012. The company has added seven stores in upscale shopping areas, which will help Lauder expand its prestige brands in India through the specialty channel. Forest Essentials, which will be examined in Kline's Natural Personal Care 2008: Competitive Brand Assessment and Ingredient Analysis report due out later this year, has also succeeded in bringing natural Ayurvedic products, once the domain of the mass channel in India, into the luxury class.
“Estée Lauder has not previously had a strong brand presence in the naturals market here,” said Ali Khan, Director of Kline’s India office. “This move allows them to test the waters for expansion by partnering with a local company to gain a bigger presence and to experiment in the Ayurvedic naturals market, which is very popular among both natives and visitors to luxury spas.”
Kline's Professional Skin Care 2007: India Market Analysis and Opportunities provides a comprehensive look at the Indian market, focusing on brands sold in beauty institutes, spas, dermatologists' offices, and plastic surgery clinics.
Karen Doskow, associate research manager, will discuss the study’s findings and highlight the market opportunities in the Indian personal care market during the HBA Global Expo & Educational Conference on September 9-11 at the Jacob K. Javits Convention Center in New York City.
For more information about Kline's global personal care and cosmetics research, go to www.klinegroup.com/market-research/research_consumer.asp.
Kline is a worldwide consulting and research firm dedicated to providing the kind of insight and knowledge that helps companies find a clear path to success. The firm has served the management consulting and m arket research needs of organizations in the chemicals, materials, energy, life sciences, and consumer products industries for nearly 50 years. For more information, visit www.KlineGroup.com.