Estee Lauder - The 2000 Packager of the Year
There is packaging and there is packaging the Lauder Way.
To understand why Estee Lauder is Cosmetic/Personal Care Packaging's 2000 Packager of the Year, one needs to debunk a myth about the $4.2 billion cosmetic company.
When Estee Lauder acquires a company, its brands become subject to a certain level of quality. In terms of packaging, the "Lauder way" means every bottle, every label, every carton, every cap and every sprayer must meet standards. Packaging must be brought up to the standard expected of every product in the Lauder portfolio. But that's as far as it goes. The packaging at Estee Lauder is a collection of 15 separate brands each with their own personality and it's the New York-based packaging group's mission to support the individuality of the brands.
It's a tough assignment. This year alone, the packaging group approved more than 4,000 projects taking from six weeks to 16 months to complete depending on the nature of the product. From entry-level Jane to luxury La Mer, the packaging group designs and executes everything from tubes to cosmetic cases, from plastic jars to glass bottles. .
The task is made manageable by a very talented team led by Roger Caracappa, senior vice president of global packaging. With 29 years at Estee Lauder including a long stint in the marketing department, Caracappa knows what it takes to give Aveda brand managers a recyclable bottle while the fragrance division needs a collectable, bejeweled solid perfume box in the shape of Cinderella's carriage.
"The way we are structured, we assign people to each of the 15 brands. So while we may be corporate, packaging is set up to think in terms of each brand as a unique division," says Caracappa.
The sheer number of projects is a challenge. "When you have so many companies it is very easy to get bogged down. But if you look at success in our business you find it's from being quick to market and being innovative," Caracappa explains. Success also comes from being in touch with consumers. "Our success in large part is based on understanding who the customer is. We are a marketing sales driven company. The developers assigned to each of these brands understand that completely. Their customer is marketing and about bringing product to market," he explains.
The one constant is quality. Once, a popular niche brand was acquired with interesting but sub-par bottles, collars and pumps. The packaging group kept the look and feel of the brand but immediately upgraded the components. "There is no compromising quality," says Caracappa.
The companies who have been brought into the corporation are encouraged to keep their entrepreneurial spirit alive in terms of how they market products and how they design products. "From a package develop ment standpoint, our position is to assist their effort," says Caracappa. "Whether it is Stila or Bumble and Bumble or Jo Malone, our marching orders aren't to 'Lauderize' companies. We have a lot of talent here. The brands view us as a resource to be used. We, in no way go in to Lauderize. If anything, we go out of our way to not do that."
New Ideas
One of the latest developments within packaging is the creation of an innovations department under Gary Korba. "With so many assignments on your desk each day how do you find the time to investigate what is new? How do you find time to look outside the industry and see what new application there are? We set up a group that will do nothing but search and discover and have input in each of the companies in the early stages," says Caracappa.
New ideas are especially important given how the sales environment has changed. Lauder has seen the shift from counter sell to open sell and believes that packaging plays a huge part of that. Copy that used to be ignored now can't afford to be ignored. Educating the customer becomes a challenge.
"Is a customer sensitive to less package? Sure they are. But are they also sensitive to more information? Sure they are. There is this balance you have to find," explains Caracappa.
Role Of Suppliers
Packaging suppliers are welcome in the offices of the group, provided they have something to contribute. "There has to be a clear understanding that both parties need to bring something to the table," says Caracappa. "You can't take our business for granted and we can't take you for granted. That's one of the priorities we have here in packaging. Whoever calls, I'll see. You never know where the next good idea is going to come from."
But Caracappa is specific about what it takes to forge a relationship with his group. "It takes five minutes to listen to someone. But there has to be a reason. If you are going to sit across my desk and say "I can make that carton as well as the next guy and I would really like to get in here,' well there has to be another reason. If you are going to tell me you make a quality carton. I already buy a quality carton. If you are going to tell me your process is same but you have a sharper price, I'm going to say to you 'You know what, direct your efforts toward the manufacturing team where repeat items are bid out and contractual agreements are set up." If you say to me 'I can make the same quality glass that they make in Paris and I can reduce your cost by 15 percent because of a new process and satisfy manufacturing's demands,' now you have given me a reason."
The Design Process
Lauder has a design process in place to manage thousands of packaging projects every year. The process is formal but flexible. "There is a lot of emotion associated with the development process," says Caracappa. "When it's over, it is like the delivery of a baby. We are like proud parents," he says.
"I read somewhere that a company's capabilities define its disabilities. You can have a lot of capable people but sometimes the processes developed within the structure create many roadblocks that you may not even be aware of," says Caracappa. "One of our biggest strengths is that we do have a system and we do have a lot of processes but we break the mold."
He also recognizes that the rate of change is accelerating. "Innovation, formulas, products, restrictions, are changing overnight," says Caracappa. "The game changes everyday. As package developers, the old rules don't apply; the old materials may not apply. Yet everyone wants to be quick to market. So our job is not to present road blocks."
The Lauder structure places package development at the divisional level near marketing. "When we assign people to package development for a brand, we know they have technical skills, but we look at personality and the fit of individuals," says Caracappa. "Obviously the person assigned to M-A-C is going to have a different method of operation than the person we assign to Origins, Aveda or Clinique."
How does the design process work? Suppose one of the brands decides they wish to introduce a new moisturizer. First packaging calls a brainstorming session with product development and marketing. Typically, marketing has a very strong position in terms of what the product needs to be unique. Plus, marketing knows how to support the suggested retail price. Finally, the group aligns what kind of packaging is needed. Launching a moisturizer for Estee Lauder requires a very different package than for M-A-C or Aveda or Origins.
Next conversations take place between the international and domestic groups about whether international wants to take part in the program. "They may decide they want to wait six months," says Caracappa. "Where we can go global we will. Where it presents restrictions of what the market is looking for, we don't. We try to e global as often as we can. When we're not global, it's not a quick decision. Either way, we take globalization and global packaging very seriously."
Once the basic strategy questions have been answered, the different "brand packagers" go to work on the concept. What follows is a detailed look at each of the brands. Note that while each has the same general philosophy, each brand has its own inherent style, which is free from corporate sensibilities as long as quality is maintained. Its success at walking this fine line earns Estee Lauder honors as 2000 Packager of the Year.
Estee Lauder
The design group for the Estee Lauder brand consists of 13 people including five full-time designers headed by John Fling, vice president of product design worldwide. The group deals with the broadest range of packaging forms in the company, including one of the most creative, the bejeweled, collectable solid perfume cases. This year, for example, the solid perfume boxes for Christmas will sell in the range of $2,500 at Bergdorf Goodman. "Solid perfumes go back at least 20-30 years," says Fling. "They start out much more in the nature of jewelry oriented pieces. Each is a little more elaborate than the one before."
Fling's department comes up with 40 to 50 ideas each year. Concepts range from Ferris wheels to top hats to the Statue of Liberty. The solid perfume pieces are manufactured in Rhode Island. "It is a lot of fun but it is also a lot of development time and work," says Fling.
Apart from the highly creative work on the solid perfume pieces, Fling's group manages packaging for all other Estee Launder cosmetics. Recently, the group helped launch Idealist, a new skincare product. "We began the project well over a year ago," says Fling. "The process is similar to other brand projects. We began by meeting with marketing, product development and packaging. We discuss concepts of the package, who the target customer might be, the nature of the formula and all the different elements that go into product. In the meeting, it became apparent that we had to make the Idealist packaging unique as opposed to developing a package that is part of a line. So we wanted something that was more youthful, meaning it was simple and portable and clean."
The group initially developed packages that had beautiful transparent colors. But as the project progressed, the formula changed and there were light sensitivity issues. "We had to look at different dispensing sues. We ended up with a package that is an off-shoot of our line image skin care bottle," says Fling. "We also modified the image a little. It was decided we wanted a plastic package to make it more portable. We worked with packaging to develop a thick-walled plastic that actually approximated the size impression of glass. We looked at every color in the spectrum and ended up with a very high, high pearl soft blue that we thought was very feminine and yet had a sort of scientific type feel to it."
Subtle changes were made over the course of the year."We ended up with a package that to anyone's eye might appear very simple and you might not think a lot of thought went into it. But it exemplifies the nature of each of our packages," says Fling. "Even though the result appears clean and pure and simple, there is a very long thought process that goes into it."
Origins
Origins' mission statement is "Bringing you a sense of harmony, health and happiness inside and out." The brand, which turned 10 in August, was the last division created in-house by Estee Lauder. And Anelle Miller, senior vice president, art and design, Origins, has been with the brand since the beginning. Her department creates all visual images for the division including packaging, merchandising and in-store designs. Simplicity has been the backbone of the brand since its inception. "We didn't want to put our money in excess packaging," says Miller. "We believe in honesty and integrity for the customer. So the money that we have to spend on a product really goes into the ingredients-into what is inside that bottle or tube. To that extent I have gotten the short end of the stick."
In keeping with both the budget and a sensible timeline, Origins has always turned to stock packaging for its bottles and jars. "What we created 10 years ago was a very timeless, classic look in our packaging. Our signature Boston round bottles are still as beautiful as they were 10 years ago," says Miller. Miller stresses that cartons are never used unless absolutely necessary. An exception to the rule is Origins; lipstick, which is packaged in a carton as there is not enough room on the primary packaging for an ingredient listing.
There are a couple of other limitations placed on packaging choices for Origins. One is that only recyclable materials will be used. The second is the materials chosen must also be appropriate for the product's use as well as be compatible with the product's ingredients. "Because of our essential oils, we have had tremendous struggles with compatibility. Because our essential oils are so dynamic, they tend to not be compatible with a lot of materials. That has been our biggest challenge," says Miller.
Miller's four person staff, who works hand-in-hand with the packaging department and designers, is kept very busy with Origins' monthly launches. But the launch size can vary, sometimes it is one product, sometimes it is 36, as it was last year when they launched a new bath and body line.
When designing new packaging, Miller's team has to keep in mind the various channels of distribution available to customers. Origins' products can be found in
channels of distribution available to customers. Origins' products can be found in the Origins retail stores, department stores and also on Origins' comprehensive website. The product must not only be consistent throughout the various channels, but also look good at each one. "Our customers are shopping all channels of distribution, whether it be the department store, the retail store, the website or direct mail. We really can't vary much between those channels," says Miller.
"It is a simple approach, an honest approach to the customer," she adds. "And it is a very classic, timeless look that we have created. We have made some customer-friendly changes over the years. Ten years ago all of our tubes used the beanie caps [a brand mark of Origins] so when you got the tube home, you couldn't really stand it up. Over time we realized that was not customer-friendly so we switched to flip-top."
Another way Origins has deviated from its original design concept is by incorporating color into the packaging. "People are drawn to color," says Miller.
This use of color was of particular importance for the launch of the Sleep Therapy line. The line, which includes six treatment products and a CD, is designed to help those people looking for alternative solutions to address their sleep problems. Research was conducted with sleep experts for the formulas and color therapy was studied for the packaging. "The blue color chosen for the packaging was taken from the color of the night sky," says Page Marcel, manager, global communications, Origins. "It is a very soothing and peaceful color," adds Miller.
Aveda
Aveda, a maker of pure-plant and flower-based hair, skin, makeup, body and aromas (what they call perfumes), was acquired by Estee Lauder in 1997. There are 500 SKUs in the brand. According to Daria Myers, senior vice president of global marketing, Aveda, 50 percent of the business is in haircare, both personal and professional. With a corporate philosophy deeply root d in environmental and social responsibilities, all ingredient and packaging choices take these standards into consideration. "Packaging plays a role that is very aligned with our mission. Everything we source, we try to align with our mission," says Myers. Packaging materials contain a high percentage of recycled materials and all containers must be, themselves, recyclable. In fact, Aveda employs a director for ecological affairs. Part of this person's job is to look for packaging that meets Aveda's standards.
Like Origins, Aveda takes a minimalist approach when it comes to packaging. Primary efforts are placed on what is in the package. "We are not about overly designed products and packaging," says Myers. "Packaging is a transporter for the product but should be user-friendly."
La Mer
"Packaging, corporately, does everything the same way," says Wayne LoPrete, executive director, global packaging development, Aramis. "But then you have the personality of each of the brands. So there are twists to the text book approach to package development. Ideally, marketing has an idea, design creates a comp. We take that comp and turn it into a functioning, aesthetically acceptable package within the parameters and price range that the brand wants. That's textbook. It doesn't quite work that way but we try to come close."
Lauder's La Mer line certainly has its own personality. Its numbers are small. "If we do 25,000 it is a lot; where as in Clinique, if you do anything less than 500,000 it is a surprise," says LoPrete. Its advertising is zilch. "It's all word of mouth," he says. And its following is devoted. "People who use it, it is like they are addicted to it. We have a 16oz. jar that retails for $1,000 and we can't keep it in stock," says LoPrete.
The core product is Creme de la Mer, a moisturizer created over 30 years ago by NASA scientist Max Huber. The smaller jars of the moisturizer are packaged in opal glass, by SGD, France. The 16oz. jar is spray painted to resemble the small jars. "We really want to run it in opal glass too. But there may be reasons why it can't be done," says LoPrete. The jars are then packaged in set boxes.
Since Estee Lauder acquired the brand, 14 products have been added and a makeup line was launched in October. The line includes concealer, foundation, loose powder and a compact. The design theme carried throughout the line is green caps with white nylon buttons. To tie the compact into the line, the button that opens the cover is made of the same white nylon. Toly Products Inc., Edison, NJ, made the compact. Two of the caps and all the buttons are from Tech Industries, Woonsocket, RI. And the jar and cap on jar are from Colt's Plastics Co. Inc., Dayville, CT.
Jo Malone
The purchase of Jo Malone has been one of Lauder's most recent strategic moves. Although Lauder owns the company, Jo Malone remains president of the division and she must approve any changes to the line. This is an excellent example of how Estee Lauder doesn't "Lauderize" its new divisions, but instead brings them up to Lauder standards.
"My perception is Jo Malone and her husband are going to be very protective of what they have done because they birthed it and created it," says LoPrete. "And here comes big, bad Estee Lauder who is going to go in there and compromise what they have done. That is not the intent at all. The intent is to detail and bring it up to our standards."
The basic style and design elements will remain the same. In fact, customers may not even notice many of the changes. "The pump is without a collar, the cap is not lined and has a sharp edge. We would never do that in this company. We will do a pump with a collar and a cap that is lined," says LoPrete. "That is the kind of thing that we will change. We will change the product so that it has certain efficiencies in filling. And consistencies in aesthetics or functionality. It is not going to look like it is part of Lauder but the quality would be what you would expect from Estee Lauder."
In addition, the bottles will be altered a bit so they look as though they all are from the same family. And the bottles and caps will be adjusted so that the plug currently found in all bottles will no longer be necessary.
Clinique
Clinique uses every type of packaging imaginable, from caps to pumps to bottles to jars. "We also do a lot of work in textiles," says Barbara Spakowski, vice president, global package development, Clinique. "Gift bags are very important to use as we do a lot of gifts with purchase." In addition, a lot of promotional items are used. Usually product related, hairbrushes, mirrors and other assorted items will be given away throughout the year.
But Spakowski asserts that Clinique is all about product. "We're not really about packaging. In many ways packaging plays the background roll," she says. "It's not the number one thing for us." But even with that, Clinique always strives for its packaging to be functional and consumer friendly. "We were one of the very first prestige companies to go into plastic packaging. We switched out of glass for all our bottles and all of our jars. We went to very beautiful, heavy wall PET which from a consumer point of view is terrific," Spakowski says. "It is consumer friendly and cost effective for us."
Eastman Chemical Co., Kingsport, TN, supplies Clinique with its clear resins while Inoac Packaging, Smithtown, NY, supplies many of the bottles and Nadel Industries, Port Chester, NY, supplies jars.
The haircare line is Clinique's newest line launch. With 11 products, the line is based on the same philosophy as Clinique's skincare line-customization. A haircare regiment can be personalized for each person based on hair type.
Cylindrical PET bottles, from Inoac, were chosen for the shampoos, and polyethylene ones, from Qualipac, Whippany, NJ, were picked for the conditioners. The custom dispenser cap, also from Qualipac, has a big C embossed on the front and is oriented to the package. This launch marks several firsts for the company. In addition to the cap being the first custom one Clinique has used, it is also the first time Clinique products have been packaged in what Spakowski called thin-walled PET.
Along with creating packaging for new products, Clinique is constantly reevaluating its existing packaging. "We tend to stay with our packaging for a longer period of time," says Spakowski. "Our cycle is probably longer than our competitors and even some of our sister companies. But what we do is try to constantly improve it."
One of the most recent examples is Clinique's eyeshadow compact. In an effort to make the silver compact instantly recognizable, the Clinique logo has been
embossed on one end. "What we are all about is reinventing ourselves within the design that we have already got," she says. "We try to improve the packaging in ways that is unobtrusive to customers."
Cartons have always provided a signature look for Clinique. "I think cartons still say prestige," says Spakowski. "For a very long time they were all about our image, our brand image. When you think about it, years ago the US had no ingredient listing laws, and in many ways all the cartons did was establish your image."
Now, in addition to providing brand image in open sell stores such as Sephora, they also provide the room needed for all of the ingredient listings and product information and, depending on the area, the multiple languages Clinique must have. "Multi-panel labels work sometimes, but if you have an acne or blemish product, then you need to tell a customer a lot about it-how to use it, warnings and you've got to have a place to put it," she says.
As a global brand, Spakowski's team also must be concerned with creating the various alterations needed for the different areas of the world. For the US market, Clinique has one set of packaging. For Canada, where there are different legal issues and two languages, Clinique has a different set of packaging. For Europe, Clinique prints English, Spanish, French German and Italian on almost every single package. "For Japan, historically we have always had to do something different for them too. The Japanese market is one of the few markets where we have made concessions over the years and actually developed different packaging for them. There is a sense that maybe their consumers are looking for something a little more cutting edge. They are always looking to be ahead of the curve. We have tried to accommodate them over the years while still having a global look,"she says.
When asked what components she is looking for, Spakowski quickly rattled off several. The first is dispenser packages that are customer friendly and inexpensive. The second is customer friendly closures that can be can be opened and closed with one hand. "This is what I think women really want. But we have to do it differently," she says. The last item on her wish list is a better pump. "Really, pumps were not giving the customer great hairspray. The only way to get good spray was by formulating with an aerosol," she notes.
Prescriptives
All of the packaging groups work independently, but they often consult with each other during projects. This informal structure helps managers like Kelly Brice, director of package development for Prescriptives and DKNY, uncover new developments when he needs them.
"We can - and do - ask other divisions how they created their packages," says Brice. "There is a vast history of packaging within this company. We call Gary Korba's Innovations Committee and Gary Bennett's engineering group and go out to the IMPAC Group's plant and tap their knowledge. Then engineering works out other aspects."
This process recently helped develop packaging for Prescriptives new fragrance, Magic. The packaging concept was to have the fragrance bottle "floating" in the middle of a clear carton. "We tied a 'magical' theme to the packaging. It is not a normal folding carton. There is a two-piece box with the a clear plastic insert that holds the bottle as if it were just floating there." The IMPAC Group does the Mylar board for Magic fragrance and developed the concept for the carton.
The Next Chapter
What's next for Lauder? Stock packaging for one. Environmentally friendly packaging for another. Aveda, for example, has always been an advocate for recyclable materials: Lauder has encouraged the brand to pursue its passion. "One of the most important things is our commitment to the environment," explains John Delflausse, vice president, packaging development. "For instance, our bottles have a minimum 40 percent recycled content. In the next year, we want to go to PET because we have beautiful products that do not show through the HDPE. But we need to do some work first. Cosmetic containers are not put through the recycling system. So we may use 100 percent recycled PET in our bottles. The more we force the issue, the more we find the suppliers are working with us."
Other environmentally friendly packages include recycled aluminum for compacts, caps and collars and the use of recycled board for cartons. "We would love to eliminate cartons but we have a lot of copy to get on our packages," says Delflausse. "We'll just have to get more creative, maybe go with multifold labels on tubes. Whatever it takes to accomplish the goal."