Estée Lauder

Estée Lauder: The Empire Built on an $800 Order

The first serious order arrived from Saks Fifth Avenue in 1947, and it was worth eight hundred dollars. To fill it, Josephine Esther Mentzer of Corona, Queens, and her husband Joseph mixed the creams themselves and filled the jars by hand, having already gambled six months' rent on office space they could not comfortably afford. Fifty-one years later, Time magazine would name her the only woman on its list of the twenty most influential business geniuses of the twentieth century.

A Hardware Store in Corona

She was born Josephine Esther Mentzer on 1 July 1908 in Corona, Queens, the ninth child of an immigrant household that lived above the family's hardware store. Her mother, Rose Schotz, had come from Sátoraljaújhely in Hungary; her father, Max Mentzer, from Pressburg, the city now called Bratislava. The shop was the whole world of her childhood, and she worked in it alongside eight siblings. The name she made famous was not a European affectation but a contraction of what the family already called her: Esty.

The Uncle in the Kitchen

The decisive figure was her maternal uncle, Dr. John Schotz, a chemist who ran a small concern called New Way Laboratories and who lived with the family. He made his creams first in the kitchen and later in a laboratory behind the house, and he taught his niece two separate things: how a formulation was built, and how a cream should be applied to a face. That second lesson mattered more than the first. After finishing at Newtown High School in Elmhurst, she began selling his preparations — a Super Rich All-Purpose Cream, a Six-In-One Cold Cream — to beauty shops, beach clubs and resorts, moving from customer to customer with the product in her hands.

In her early twenties she met Joseph Lauter, whose father had emigrated from Austria and whose surname had been misspelled somewhere in the immigration paperwork; the family restored it to Lauder. They married on 15 January 1930 and their son Leonard was born in March 1933. The marriage did not hold. They separated and divorced in 1939, she moved to Florida, and then in 1942 they remarried. Their second son, Ronald, was born in 1944. Joseph remained her business partner until his death in 1983.

Eight Hundred Dollars from Saks

The Estée Lauder Cosmetic Co. was founded in 1946 at 501 Madison Avenue. What made it a company rather than a sideline was the Saks account: an $800 order in 1947 that she had talked her way into, and which the couple filled by working through the nights. From that point she made a decision that defined the firm for the next half century — she would not sell through the mail or the drugstore, but from a counter inside a good department store, where a woman's face could be touched.

She therefore made herself the field force. She demonstrated the products at the counters personally, turned up at store openings to train the beauty advisers, and chose the pale turquoise of the jars herself because she judged it would look right on a bathroom shelf. She was, in effect, a one-woman market research department who collected her data by standing in front of customers rather than behind a desk.

Youth-Dew Changes the Arithmetic

In 1953 she launched Youth-Dew, a bath oil of rose, jasmine, vetiver and patchouli that doubled as a skin perfume. The chemistry was not the innovation. The insight was commercial and slightly subversive: at the time, respectable American women received perfume as a gift from a man. Youth-Dew was priced and positioned so that a woman would buy it for herself, without occasion or permission. It sold 50,000 bottles in its first year. By 1984 the figure had reached 150 million. The business multiplied roughly tenfold and by 1960 had gone international.

Telephone, Telegraph, Tell a Woman

Her second great commercial device was the free sample given at the moment of sale — the gift with purchase, which the industry adopted wholesale and has never abandoned. The logic was the logic of her uncle's cold cream in a Queens beauty parlour, scaled to a continent: get the product onto the skin, and the sale takes care of itself later. Her own summary of her method was blunt. "I have never worked a day in my life without selling," she said. "If I believe in something, I sell it, and I sell it hard." Her motto for word of mouth was cheerfully unsentimental: "Telephone, Telegraph, Tell a Woman."

The house expanded by inventing brands rather than buying them. Aramis took the method to men. Clinique, Prescriptives, Lab Series and Origins each carved out a separate proposition under the same roof, so that a customer could leave one Lauder brand only to arrive at another.

The Biography She Preferred

She also invented a past. For years she let it be understood that she came from European gentility — a Viennese upbringing, a fashionable childhood in Flushing complete with stables and an Italian nurse. Lee Israel's 1985 book *Estée Lauder: Beyond the Magic* took the story apart; her mother had in fact arrived in America in 1898 with five children, joining her first husband. Her New York Times obituary put the correction plainly: she was a New Yorker, and not an aristocrat at all. It also allowed that the mythmaking was itself part of the magic of the beauty industry. She was, in this as in everything, selling.

Why Estée Is Called a Genius

The word has been formally applied: Time placed her in 1998 among the twenty most influential business geniuses of the twentieth century, the only woman on the list. France had already made her a Chevalier of the Legion of Honour in 1978, and she received the Presidential Medal of Freedom in 2004.

The quality being honoured is not scientific. She discovered no molecule and formulated no breakthrough; the creams that launched her were her uncle's. What she possessed was an unusually exact reading of consumer psychology, and the stamina to act on it herself, at counter level, for decades. Youth-Dew is the clean demonstration: she identified an unspoken social rule governing who was allowed to buy perfume, and priced a product straight through it. The gift with purchase rests on a similar reading — that the obstacle to a cosmetics sale is not price but risk, and that the risk vanishes on contact with skin.

The honest counter-case is substantial. Her innovations were merchandising devices, not inventions, and claims of primacy in an industry this promotional are notoriously hard to adjudicate. She was, moreover, a documented embroiderer of her own history, which is precisely the kind of witness whose firsts should be checked rather than repeated. What survives the scepticism is the record: a company begun on an $800 order that outlived her by decades, built on two ideas she was right about before anyone else acted on them.

What She Left at the Counter

She retired in 1995. On 24 April 2004 she died of cardiopulmonary arrest at her Manhattan home, aged 95. Leonard ran the company as chief executive and then chairman; Ronald went into public life, serving as a deputy assistant secretary of defense under Reagan, as U.S. ambassador to Austria in 1986–87, and from 2007 as president of the World Jewish Congress. The firm that carries her name now employs more than 57,000 people. Her most durable bequest, though, is the arrangement itself: the lit counter, the trained adviser, the small free thing pressed into a customer's hand.

Achievements

• Presidential Medal of Freedom — 2004
• Knight of the Legion of Honour
• Educated at Newtown High School