Deciem Acquired by Estee Lauder is Closing its Several Niche Brands

Deciem owned by Estee Lauder stated to close its niche brands HIF, Hylamide, Abnomaly, and The Chemistry Brand to focus on its another brands The Ordinary and high-end brand NIOD.

Deciem, which is owned by Estee Lauder, recently announced that it was dropping its niche brands HIF, Hylamide, Abnomaly, and The Chemistry Brand lines to focus on its remaining brands: NIOD and The Ordinary.

Estée Lauder’s Deciem business is dropping its HIF, Hylamide, Abnomaly, and The Chemistry Brand lines, with customers able to buy their products until their inventories run out, according to a company Instagram post.

The company said in its Instagram post that customers are able to buy their products until their inventories run out.

Deciem was founded in 2013 and describes itself as “a beauty company with a genuine commitment to ingredients. After Estée Lauder Group completed its first acquisition of Deciem, it said Deciem’s innovative multi-brand strategy is driven by a vertically integrated structure (with its own lab, product line, e-commerce platform, retail stores and marketing base) that allows the company to quickly identify opportunities to create and incubate new brands and deliver high-quality, highly sought-after products. The company said that the focus on brands will give it the space to innovate through new brands in the future.

As of today (April 7, 2022, BST), the products on sale on the Chinese e-commerce platform Tmall Global Deciem’s overseas flagship store are dominated by The Ordinary and Niod. Its brand Hylamide products still have 5 SKUs on sale and its best selling is HYLAMIDE C25 Stablized Vitamin C Booster with monthly sales volume of 59 units with the price of $51.7. The Chemistry Brand still has 2 SKUs on sale with total sales volume of 2000 units and monthly sales of 45 units with price range from $14.6 to $37.3. The remaining, two brands, HIF and Abnomaly, are not sold in their overseas flagship stores.

Currently, the majority stake in the company belongs to Estee Lauder Company. In 2017, Estee Lauder acquired 29% of the shares of Deciem, the parent company of The Ordinary, and later acquired a majority stake in Deciem in 2021 for about $1 billion, so that Estee Lauder’s shareholding rose to 76%. The company said that it would acquire the remaining shares within 3 years thereafter and the initial price of the deal was $1 billion.

Tracey Travis, executive vice president and CFO of Estee Lauder Company, has previously said that the company will always consider rationalizing its brand portfolio and divesting some businesses, and that such rationalization will cover stores, special stores and specific brands.

Deciem’s net sales for the 12 months ended Jan. 31, 2021, almost doubled to about $460 million since being owned by Estee Lauder Group, with The Ordinary playing a starring role.

The Ordinary can be said to be a brand that has made a name for itself as an ingredient beauty brand. Known as the “affordable ingredient bucket”, its biggest attraction is the “cheap and strong efficacy”. With “transparency, sincerity, professionalism as the core concept of the brand, it insists on making sincere ingredient beauty. Cutting into the skincare sector by ingredients, The Ordinary has gathered popular potent ingredients such as amygdalin, retinol, A-alcohol, caffeine, and vitamin C under its umbrella.

To date, in the Chinese e-commerce platform Tmall Global, comparing with the data on February 24, 2021, Deciem’s overseas flagship store has increased followers from 598,000 to 997,000. Its highest selling products has changed from The Ordinary Alpha Arbutin 2% + HA with monthly sales volume of 6,600+ units to The Ordinary AHA 30% +BHA 2% Peeling Solution with monthly sales volume of 10,000 units. It can be seen that 73 SKUs are available in its flagship store. On the promotional page of its best-selling product, it claims that the product has sold 1 million+ bottles worldwide in 2021 at a price of $15.6. In terms of data, both sales and followers are on an upward trend.

In 2018, Brandon Truaxe, the founder of The Ordinary’s parent company Deciem, suddenly posted on Deciem’s official Instagram account that Deciem would close all stores and would soon go out of business and accused the company’s employees and more than 40 brands such as Estee Lauder Group of being involved in illegal activities. Beauty giant Estee Lauder Group, a shareholder and significant stakeholder in Deciem, took the brand’s founder and CEO Brandon to court after the incident, seeking his removal from his position as CEO after he made inappropriate comments and actions. The judgment was handed down less than a week later.




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