The beauty industry giant The Estée Lauder Companies has stepped into a new phase of transformation. On April 1, the company announced the full establishment of its new operating model, “One ELC,” and at the same time revealed that its ongoing Profit Recovery and Growth Plan (PRGP) had reached an “important milestone.” At the heart of it all is WPP, appointed as the company’s first-ever global media partner.
WPP, One of the World’s Largest Advertising and Marketing Groups
WPP, the partner Estée Lauder Companies has chosen, is one of the world’s leading marketing and communications groups, headquartered in London. Positioning itself as a trusted growth partner for the world’s leading brands, WPP’s greatest strength lies in unifying a wide range of capabilities within a single company. It offers, all under one roof, cutting-edge media intelligence and data solutions, world-class creativity, next-generation production, transformative enterprise solutions, and expert strategic counsel. The group also operates its own proprietary agentic marketing platform, “WPP Open,” helping clients navigate change, capture opportunity, and deliver transformational growth.
Within the group, the media domain is led by WPP Media, its global media collective. WPP Media operates on the premise that “media is everywhere and in everything,” and its mission is to bring together the best platforms, talent, and partners to create limitless opportunities for growth. What Estée Lauder Companies has chosen as the core partner of its “One ELC” framework is precisely this group, equipped with both scale and capability.
From Decentralized to Globally Integrated — A Reinvention of Media Strategy with WPP
Estée Lauder Companies will consolidate its previously region-by-region media buying operations under WPP, transitioning to an enterprise-led, globally integrated model powered by data, technology, and AI.
Aude Gandon, Chief Digital and Marketing Officer of Estée Lauder Companies, commented on the partnership with WPP as follows: “Today, beauty is discovered and experienced across a constantly evolving mix of platforms. To lead in this environment, we are building a connected, AI-enabled media system that brings brand building and performance together at global scale. Partnering with WPP strengthens our ability to invest with greater precision, move with greater speed, and deliver stronger, more measurable returns, while keeping creativity and brand leadership at the center of everything we do.”
What emerges from Gandon’s remarks is a clear intent to dissolve the divide between brand building and performance marketing, and to connect the two on a global scale.
The Three Pillars Supporting “One ELC”
Stéphane de La Faverie, President and Chief Executive Officer, positions the appointment of WPP as the moment that fully establishes the “One ELC” operating model. The model rests on three pillars: “One Team,” “One Culture,” and “One Operating Ecosystem.”
One Team, deployed in July 2025, is an organizational restructuring designed to reduce layers and silos, clarify ownership, and accelerate decision-making. One Culture, introduced in February 2026, is an effort to embed accountability, entrepreneurial thinking, and agility into the team’s daily ways of working. One Operating Ecosystem, in turn, brings together shared platforms and strategic partners that span brands, regions, and functions.
De La Faverie stated: “With the appointment of WPP as our first-ever global media partner, our One ELC operating model is now fully established. This more unified and scalable system will enable us to be faster, more agile and efficient, and support unlocking additional growth. Together with our execution progress, we are confident that we are on a trajectory to deliver sustainable, profitable long-term growth.”
Accenture and Shopify Also Join
WPP is not the only partner making up the “One Operating Ecosystem.” Accenture is leading the transformation of shared services through Estée Lauder Companies’ “Enterprise Business Services (EBS)” model, driving standardization and efficiency across core functions. EBS is on track to be fully in place by the end of calendar year 2026.
Shopify has been chosen as the e-commerce partner. Adopted as the foundation supporting ELC’s global direct-to-consumer omnichannel experience, Shopify’s initial implementation on TOM FORD BEAUTY’s brand site in the U.S. has reportedly already delivered improvements in sales, conversion, and average order value. The company plans to migrate 50 percent of its in-scope direct-to-consumer business to the Shopify foundation by the end of calendar year 2026.
PRGP Heading Toward the Top of Its Target Range — Workforce-Related Costs Exceed $800 Million
On the financial front, the PRGP is now on track to achieve total benefits at the “high end” of its target range. Estée Lauder Companies explains that, based on initiatives approved to date, it expects to reach the upper limit of its initial annual savings target of $0.8 billion to $1.0 billion.
Meanwhile, the total cost of the restructuring is projected to land at the midpoint of the $1.2 billion to $1.6 billion range. As of March 31, 2026, cumulative restructuring costs had reached approximately $1.367 billion — up from the $1.2 billion estimate disclosed in the previous filing on February 5, 2026. The bulk of the additional costs relates to workforce reductions tied to efforts to reorganize and simplify the company’s global marketing and creative operating model.
The burden of workforce-related costs is significant. Between January 31 and March 31, 2026, $106 million was recorded in employee-related costs over the two-month period, bringing total PRGP-related staff expenses to $827 million. The company expects to reduce its workforce by between 5,800 and 7,000 employees as part of the PRGP.
All business case approvals for the PRGP are still expected to be made by June 30, 2026, with execution substantially complete by the end of fiscal 2027. The company has affirmed that the vast majority of the PRGP’s full run-rate benefits, including those of the Restructuring Program, will be achieved during fiscal 2027.
De La Faverie added: “Building on our strong fiscal 2026 first half results, which included increased consumer-facing investments to restore sustainable sales growth, today we announced an important milestone in the Profit Recovery and Growth Plan’s Restructuring Program. We have now approved initiatives to achieve the high-end of the target gross savings range and affirmed we are on track to realize the vast majority of PRGP’s full run-rate benefits in fiscal 2027. The PRGP has instilled a strong sense of cost discipline into our organization that is now embedded in our ways of working.”
The Backdrop: Merger Talks with Puig
Another reason this announcement is drawing attention is that it coincides with reports that Estée Lauder Companies is in talks with the Spanish beauty giant Puig over a potential merger. With its portfolio of numerous prestige brands including MAC Cosmetics and Clinique, the company’s accelerated push toward structural reform and ecosystem rebuilding may also signal the early stirrings of broader industry realignment.
The completion of “One ELC” and the milestone achievement of its restructuring plan. As Estée Lauder Companies presses forward with its new growth narrative — one that comes with the painful cost of up to 7,000 job cuts — whether this becomes a defining example of the seismic shift underway in the beauty industry remains a story worth watching closely.
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