Strategic Business Decision-Making and Future Transition of Estée Lauder: From 4IR to 5IR in the Global Luxury Cosmetics Market

Xiyao Jia

doi:10.71222/8pnfhm60

Authors

Xiyao Jia Dongbei University of Finance and Economics, Liaoning, 116025, China Author

DOI:

https://doi.org/10.71222/8pnfhm60

Keywords:

Estée Lauder, strategic management, sustainability, fifth industrial revolution (5IR), cosmetics industry

Abstract

This paper presents a critical analysis of the strategic business decisions undertaken by Estée Lauder Companies, a global leader in the luxury cosmetics industry. It examines the principal challenges currently faced by the company, including supply chain vulnerabilities, increasing market competition, dependence on travel retail channels, and the growing imperative for digital transformation. The paper also provides strategic recommendations to support sustainable growth and facilitate the company’s transition from the Fourth Industrial Revolution to the Fifth Industrial Revolution, emphasizing ethical innovation and human-centered technological development. Employing analytical frameworks such as PESTLE, SWOT, the BCG Matrix, and the Business Model Canvas, the paper evaluates both external environmental factors and internal operational strategies. This comprehensive approach enables a detailed examination of Estée Lauder’s efforts in innovation, supply chain optimization, talent management, sustainability implementation, and climate change adaptation. The findings indicate that despite a decline in overall revenue in the 2023 fiscal year, Estée Lauder achieved promising growth in the Asia-Pacific region, particularly in Mainland China and Hong Kong. The company has made significant progress in its sustainability agenda, including the achievement of global carbon neutrality and the use of renewable energy sources. Continued investment in product innovation and digital infrastructure is contributing to long-term competitive strength. To maintain resilience and market leadership, the paper recommends that Estée Lauder expand local production in key regions, diversify distribution channels, and enhance workforce training in advanced technologies. Strengthening transparency in sustainability reporting and prioritizing responsible use of emerging technologies will also be essential in advancing toward the Fifth Industrial Revolution. Overall, this paper provides valuable insights into how a luxury beauty brand can adapt to dynamic global market conditions through proactive and forward-looking strategic decision-making.

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