Consumers Are on 'Tenterhooks': Lauder

Woman spraying perfume on her neck

American consumers are on "tenterhooks," said William Lauder, executive chairman of cosmetics maker Estee Lauder.

"The consumer is back with a certain level of confidence...but if (consumers are) given an excuse, (they'll) pull back," Lauder told CNBC.

According to Lauder, American consumers are "more binary" than consumers in other countries. They tend to be either "in" or "out."

Long lines of people camping out to buy Apple's latest iPhone show that consumers are willing to buy the items that they want, but Lauder expects retailers have to make the products worth it for them.

Lauder also said he rejects the idea that there can be a "global" consumer.

"The consumer is very local," Lauder said.

In China, for example, the mood among consumers is very "confident," he said, adding that Chinese consumers are increasingly influencing sales of products in other regions.

"They are the biggest contributor to travel retail," he said, noting the large number of airports being constructed throughout the country to meet the growning consumer demand.

Travel retail, which includes sales of perfumes and other cosmetics at "duty-free" shops is a big business for Estee Lauder , and Chinese consumers are key customers for this business segment.

As for Europe, Lauder suspects that recent economic developments in the region will eventually hurt consumers there.

Western European countries have been cutting government programs as the countries implement government austerity programs aimed at reducing sovereign debt. These cuts include salary cuts, reduced welfare benefits and possibly even higher taxes, all of which could hurt sales of personal-care products.

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