Business Interview: John Demsey, group president of Estée Lauder

What else could one expect from a beauty industry executive? Rather than meeting in a drab office conference room, the interview with John Demsey, group president of Estée Lauder, takes place over afternoon tea at Claridge's, a favourite celebrity haunt. Arriving right on time, he breezes through the Mayfair hotel's revolving doors in a dapper navy-blue suit, crisp, open-collar shirt and matching pocket handkerchief. Despite having just arrived from Fashion Week in Milan, he looks none the worse for wear.

With him is Dita Von Teese, the porcelain-skinned burlesque performer who is endorsing a new lipstick from MAC, one of the cosmetic giant's many brands. Wearing a black dress and some painful-looking high heels, she looks almost demure. Which makes it all the more difficult to imagine that just a few hours later she will be on stage riding a 9ft "bucking bronco" lipstick and wearing next to nothing at the launch party for the Viva Glam 6 product.

That spectacle - which was attended by a smattering of models, drag queens, fashion designers and scantily clad ushers whose torsos are spray- painted gold - is the reason for Demsey's London visit. Such extravagant events are, apparently, all part of the normal course of business in the beauty industry. He's only in town for another day, however: Paris Haute Couture Week beckons.

For Demsey, 51, it's not a bad life. "This is the fun part of the job. I am living the lifestyle I never thought I would have. I grew up as a pop culture junkie in Cleveland, Ohio. I spent a lot of time watching television and reading magazines wondering what it would be like. I have met and worked with incredible people on a lot of different things that never in my wildest dreams would I have conceived of," he says as he eases back into the plush corner booth.

He then rattles off a list of celebrities - P Diddy, Pamela Anderson, Gwyneth Paltrow, Elizabeth Hurley - whom he has drafted in over the years to push everything from eyeliner to perfume in the 120 countries on the company's map.

And the way he sees it, there is still plenty of road to go for Estée Lauder, which is already the world's largest seller of "prestige", or premium, cosmetics. His reasoning is simple: "There are a few universal truths: nobody wants to look old; everyone wants to look better; everybody wants to be attractive to someone else. I don't care what brand it is or where you are in the world, they are universal truths." Almost as an after- thought, he adds: "And people want to be happy."

The challenge for Demsey, however, is to reinvigorate Estée Lauder, whose founder died in 2004. The company's clientele is getting older, and the department stores where they have gone for so long to buy their creams and perfumes are disappearing, at least in North America.

Demsey looks after brands responsible for around half of the group's $6.5bn (£3.5bn) in overall turnover. Although he has been with Estée Lauder for 16 years, he is an outsider; it is majority-owned and run by the billionaire Lauder family. He describes his job, though, as "the gig of a lifetime" and says the family have given him the freedom he needs to help reinvigorate the group. And for the brands he looks after - the flagship Estée Lauder line, MAC, Tom Ford Beauty, Sean John, Prescriptives - reinvigoration means celebrities.

In today's fame-obsessed society, he explains, attaching the right name to the right product has never been more important. "When you talk about the beauty business, the product has to have some aspirational quality. In our business, those brands that are able to establish a community or a personality are those that break through the clutter and find people to engage with them."

The "aspirational" aspect of make-up - the idea that buying lipstick or wrinkle cream is also about buying into a vision of a better life- is a theme Demsey often returns to as he talks about the group's plans to expand worldwide. Cosmetics can even, he says, "enable self-discovery and personal transformation".

Such talk may be a bit hard to swallow. But Demsey seems genuine and, if nothing else, provides a fascinating, though unsettling, insight into the thought processes behind the mass-marketing of beauty products.

Consider, for example, his description of hip-hop impresario P Diddy, with whom he launched a hugely successful cologne last year: "He's a unique business. He's a celebrity. He's a brand. He's a cultural movement. What I mean by that is that anyone under 35 years old listens to R&B and hip-hop music. Whether he is the most talented musician or not, he is at the epicentre of the creation of that world. Young people view him as a lifestyle."

He goes on: "In a funny sort of way, he's the hip-hop Ralph Lauren. Because many, many years ago, Ralph Lauren created a brand and a lifestyle that people sort of aspired to be part of. [P Diddy] is modern-day aspiration."

Like it or not, the strategy seems to be working. The group, whose other brands include Clinique, Bobbi Brown, Aveda and Origins, accounts for nearly half of all high-end cosmetics sold both in this country and in North America. It is growing internationally as well: more than half its annual turnover now comes from outside Canada and the US, with the biggest expansion seen in places like Russia and China, though the UK remains the largest foreign market for the group.

It is not, however, all about peddling narcissism. Through MAC, Demsey leads a project unique in cosmetics, or indeed any industry. The MAC Aids Fund - which receives 100 per cent of the proceeds from the Viva Glam line of lipsticks and lip glosses, like the one launched with Dita Von Teese's nipple-tassel extravaganza - has raised more than $95m since it was started 13 years ago. What began in 1994 with the launch of one lipstick fronted by transvestite extraordinaire RuPaul, is now the largest non-pharmaceutical funder of HIV/Aids programmes in the world. Consistent with the brand's edgy, alternative image, the fund has gone out of its way to give money to causes that other big charities were much slower to back, such as condoms for sex workers in Bangkok and needle exchange programmes in St Petersburg.

So while rubbing shoulders with the stars and hopping from one fashion show to the next are nice perks of the job, the fund is close to Demsey's heart. "The charity is the one thing I feel best about. I never thought it would grow to the stature and influence that it has today," he says.

Of course, his good works would not be possible if the billions didn't continue to roll in for Estée Lauder. But that shouldn't be a problem, thanks to a few universal truths.

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