Part 7/9:
As the Covid-19 pandemic restrictions lifted, Estee Lauder anticipated a rebound in sales. Instead, the crackdown on Daos squeezed their revenue streams, leading to a profound operating loss of nearly $600 million by the second half of 2024. Estée Lauder had become overly reliant on international travel and a singular business model that could no longer withstand external pressures and changing regulations.
Meanwhile, competition within China emerged as local brands like Priya began to capture market share, offering consumers more affordable options without the burdens of tariffs. Estee Lauder found themselves trapped in a declining market with insufficient innovative offerings to lure back lost customers.