Estée Lauder’s CFO talks growth
“One of the things that attracted me to Estée Lauder is the people who are quite special here,” says Tracey T. Travis, EVP and CFO at The Estée Lauder Companies Inc. I sat down with Travis to talk about her career journey and how the company that turned 75 this year has navigated the coronavirus pandemic.
The New York-based multinational cosmetics giant, led by president and CEO Fabrizio Freda, reported in August net sales of $16.22 billion for its fiscal year ending June 30, an increase of 13% from $14.29 billion in the prior-year period. Net sales grew 11% when excluding the impact of currency translation. Skin care net sales in Estée Lauder’s portfolio grew across every region, led by Estée Lauder, La Mer, and Clinique, the company reported. Meanwhile, the recovery of a decline in makeup sales has been gradual.
“Consumers were increasingly even more focused on the ritual of skin care,” Travis says. More time spent at home and also looking at yourself all day in video calls may have been the main drivers, she says. Estée Lauder’s customers pivoted to online shopping. “Our online business sales grew 34% in fiscal ‘21,” Travis says. “Online is almost double what it was two years ago in terms of a percent of sales.” Whether “live chat with video, the virtual try-on [tool], or social selling, those were capabilities that we added more broadly onto our online sites,” she says.
At the onset of the pandemic, “we initially focused on making sure that we had liquidity, not knowing how long brick-and-mortar retail stores were going to be closed,” Travis explains. “But we very quickly shifted to focusing on recovering and making sure that we were investing in areas that would allow us to emerge even stronger post-pandemic.” The acquisition of Korean skin care brand Dr. Jart+ and an increase in its ownership of Deciem Beauty Group were investments. Longer-term innovation included “investing in a state-of-the-art manufacturing facility in Tokyo, and we also are opening a new Shanghai Innovation Center in the spring of 2022,” she says.
Travis joined Estée Lauder in 2012. She was previously SVP and CFO at Ralph Lauren for seven years and SVP and CFO of Intimate Brands for Limited Brands Inc. Travis spent a decade at PepsiCo Inc. and the Pepsi Bottling Group in financial leadership and operations management roles. But her career actually began at General Motors Co. as an engineer and then as a senior financial analyst. “It’s been a very non-traditional career path for sure,” Travis says.
Although counseling and sponsorship for finance roles were important, “early in my career, I really focused on making sure I had broad experience,” she says. In the process, “several of the moves that I took were lateral, not upward,” in order to broaden skill sets, Travis says. Since then, an emphasis on strategy has been a common thread in all of her positions, she says. At Estée Lauder, “working as closely as I do with our CEO on transformation, strategy, and resource allocation is a fundamental part of the role,” Travis says.
In the finance industry, women are represented in just 40% of senior roles, and people are color are represented in only 6% of senior finance roles, according to a recent Gartner report. I asked Travis if she had any advice for those who would like to follow her path.
“Well, first of all, stick with it,” she says. “We need more pipelines in finance. It’s a great career for women, in general. So, we need more women and certainly more women of color. Having mentors and sponsors to guide you along the way is important.” But it’s also vital in a finance role to have in-depth knowledge of the company and its operations, Travis says. Also, develop relationships with peers and those you supervise, she advises.
“Continue to lift people up as you move up … I have found that incredibly rewarding,” Travis says.
See you tomorrow.
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Courtesy of Accenture
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