The company began in 1946, when Joseph Lauder and wife Estée Lauder began producing cosmetics in New York City, New York. At first, they only had four products: super rich all purpose cream, creme pack, cleansing oil and skin lotion. Two years later, they established their first department store account with Saks Fifth Avenue in New York.

Over the next fifteen years, they expanded the range and continued to sell their products in the United States. In 1960, the company went international. Its first international account was in the London department store Harrods. The following year, it opened an office in Hong Kong.

In 1964, they started Aramis Inc., which produced fragrances and grooming products for men. In 1967, Estée Lauder was rewarded for her efforts by being named one of ten Outstanding Women in Business in the United States by business and financial editors. This was followed by a Spirit of Achievement Award from Albert Einstein College of Medicine at Yeshiva University in 1968. In that year, the company expanded again, opening Clinique Laboratories, Inc. Clinique was the first dermatologist guided, allergy tested, fragrance free cosmetic brand created by Estée Lauder.

Estée Lauder's Clinique brand became the first women's cosmetic company to introduce a second line for men when, in 1976, they began a separate line called "Skin Supplies for Men". In 1981, the company achieved another breakthrough when their products became available in the Soviet Union.

Estée Lauder now sells its products in department stores across the world, as well as having a chain of freestanding retail outlets. It employs over 20,000 people, and in 2003, its sales topped $5 billion. In February 2004, the company's teen-oriented jane business was sold; in April 2006, the professional-quality Stila brand, which Estée Lauder purchased in 1999, was sold.

The company has been known for its sometimes iconic spokesmodels, sometimes referred to simply as 'faces'. Past 'faces' for Estée Lauder include Karen Graham, Bruce Boxleitner, Shaun Casey, Willow Bay and Paulina Porizkova. Currently, the public spokesmodels for Estée Lauder are actress Gwyneth Paltrow, supermodels Hilary Rhoda and Carolyn Murphy, and model Elizabeth Hurley.

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In 1968, magazine editor Carol Phillips consulted with Park Avenue dermatologist Dr. Norman Orentreich for an article titled "Can Great Skin Be Created?". The doctor shared the products and procedures that he used in his own office. The article caught the attention of Estee Lauder and Dr. Orentreich was brought on board to help create the first Dermatologist developed skincare line.

Clinique was developed for people who have very sensitive skin, and prior to Clinique, could use very few cosmetic products. Clinique was at that time different from most cosmetic companies in that its goal was to meet individual skin care needs by categorizing skin types. Clinique products are Allergy Tested and 100% fragrance free.

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