• Wall Street Journal, Tuesday, May 5, 2009 11:15 AM

First Starbucks tells us it's a value brand; now it's Estée Lauder's turn. In reporting a 70% drop in quarterly profits, the cosmetic maker says it hopes to rejuvenate sales by selling smaller, less-expensive perfume bottles and offering more free services at counters.

What's more, it won't be so tight-lipped about prices, Ellen Byron reports. You won't have to ask how much something costs, and some brands will even post prices.

About 25% of Lauder's sales are from department stores. Despite lower sales, which he attributes to less traffic, CEO William Lauder points out that upscale cosmetics are outperforming department stores' overall business.

"For those small indulgences that are important now, I believe [the customer] gets more satisfaction in our category," Lauder says. He feels it's important to maintain service levels while "reducing the intimidation factor at the counter."

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