Strategic Move: Lauder to buy Smashbox

Estee Lauder announced this week that it will purchase Smashbox, the LA photo-studio and Hollywood inspired brand, founded by Dean and Davis Factor, great-grandsons of legendary Hollywood makeup artist Max Factor. The move by Lauder complements the existing make-up portfolio consisting of MAC and Bobbi Brown, both make up artists brands and shouldn’t bring any cannibalization. Au contraire, it gives Lauder access to a younger audience reached by a variety of alternative channels (outside the traditional department store that is responsible for 30% of Lauder’s sales) including QVC, Sephora, ULTA and Macy’s new Impulse Beauty concept.

Smashbox will also bring knowledge in digital and social media."We are excited to be acquiring a uniquely positioned cosmetics brand with true talent well known for engaging consumers," John Demsey, a group president at Estee Lauder (LA Times).

Here are my 3 takeaways from the acquisition:

- Expansion into new channels of distribution (i.e. assisted open-sell environments and specialty distribution channels)

- Access to younger generation

- Expertise in digital and social media to advance its current capabilities

Read original Estee Lauder Press Release. Found at NYTimes blog.