A seismic shift occurred less than a year into William's tenure as CEO. For decades, Estée Lauder had used the strength of its brand names to control department-store
display space and even the timing of promotions. Then, in February 2005, Federated Department Stores agreed to buy May. The new Goliath shuttered dozens of outlets and began squeezing suppliers like
Estée Lauder.
Long concerned about the company's dependence on department stores, William had earlier pushed the company to develop a chain of stores specific to the Origins line. As CEO, he developed Internet retail sites, opened more one-brand stores and sought acquisitions. But his father, Leonard, who had established Estée Lauder's strong relationship with department stores, wasn't keen to alienate the retailers who were essential supporters in the company's early days.
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