Nearly a year ago, Estée Lauder CEO Fabrizio Freda told us that the best way to compete with skin care brands coming out of South Korea — currently the world's hub of innovation in that arena — was to embrace its trends and technology. Freda's team had seen South Korea's domination in skin care coming for some time: Clinique, an Estée Lauder-owned brand, was one of the first to bring BB creams to the US.Now Estée Lauder is drawing closer to the source of South Korea's advancements in skin care technology. The company is taking a stake in Have & Be Co. Ltd., the owner of Do The Right Thing and Dr. Jart+, one of the first skin care brands to start sponsoring runway shows at New York Fashion Week. Estée Lauder has not at this point disclosed the terms of the agreement.
The deal, which should close by December, marks Lauder's first investment in a Korean cosmetics brand. The company has in recent months been working to align itself to Korea's beauty scene through other means, though. This summer, for instance, it signed the rainbow-haired model Irene Kim, who was born in Seattle and moved in middle school to Seoul, as a "global brand contributor."
No doubt we'll hear more about this investment next week, when Estée Lauder gives its first financial update of the fiscal year. It comes at a good time, though: In August, the company's skin care sales were down, thanks to decreased consumption in Hong Kong and, yes, Korea.