Estee Lauder's holiday tactic: good things in smaller packages


Every TV talking head and soundbite economist out there has a bet on when the economy will rebound, and their guesses run the gamut from sun-coming-soon to apocalypse-now.

One executive who isn't placing any wagers is Estee Lauder's COO, Fabrizio Freda. After getting burned during retail's atrocious holiday last year, Freda is already girding for this year's gift-giving season. His plan? Keep giving customers the cosmetics and fragrances they know and love. Just give them -- and charge them -- a little less. The company will offer new, downsized portions of fragrances like Clinique Happy. Happy is regularly sold in a 3.4-oz. bottle -- by November, 1.7-oz. and 1-oz. versions will be on shelves, too.

It's a winning strategy, especially in an industry where so much is illusion. Freda didn't offer any sketches with his brainstorm, but imagine how many things a beauty company can do to make a little look like a lot. Thicken the glass of a perfume bottle by a millimeter or two; shorten the container and put a little more height on the plastic cap; tweak the design to make the bottle's curves a little less generous. I'm sure the smaller versions of the products will be carefully rendered to ensure that no consumer feels cheated at the counter (and that no gift recipient feels gypped when they open it).