‘The Lipstick Effect’
An economic indicator, or a coincidence? In this blog we explore how cosmetic sales - particularly lipstick - surge during periods of nationwide difficulties, from recession to depression.
The phrase was originally coined as the ‘Lipstick Index’ by American billionaire, Leonard Lauder, an executive of the esteemed cosmetics brand, Estée Lauder. He noticed, after the World Trade Center attack on the 11th September 2001, that throughout the following autumn American lipstick sales increased by 11%. This lead to him theorising that cosmetic sales, and lipstick especially, could be used as an economic indicator.
While this could easily be coincidence, there are statistics to suggest that there is truth in this theory.
Cosmetics in Economics
In addition to cosmetics - takeaway coffee (Starbucks), designer perfumes, sparkling wines, fast-food and cinema sales have been evidenced as increasing during periods of national distress.
The origin of this correlation stems from the Great Depression in 1930s America. While industrial production plummeted, sales of cosmetics increased. Furthermore, in the recessions of 1990 and 2001 jobs in the US cosmetics sector increased while manufacturing employment was experiencing crisis.
In recent times, while the initial impact of the Brexit vote affected the economy in Britain, cities in the north of England, such as Liverpool, felt the full brunt of the political decision. As a result, economists realised that lipstick sales, as well as coffee and some wines, increased amid austerity.
Meanwhile, as British wages increase at a slower rate than inflation, general living standards in Britain decline in terms of how far our money goes. For this reason, in recent years spending on household goods and holidays has decreased.
Will we see an influx in cosmetic sales yet again?
What makes Lipstick & other Cosmetics so powerful?
We’re not entirely convinced by the idea that a cosmetic sales insurgence is an indicator of economic issues. The conclusion we draw from the evidence is simply that, in times of hardship, small indulgences can offer solace.
Cosmetics empower people. ‘The Lipstick Effect’ may mean ‘economic indicator’ to market analysts, but at SK-IN, it means self-esteem.
Studies suggest that strong self-esteem can help with cognition, meaning a better ability to understand & utilise information, and to enjoy things more fully; overall, more happiness and a stronger sense of self.
The Lipstick Effect to us, is being at your best even when your situation is difficult.
Contact us today to harness the potential of cosmetics on your wellbeing.
For him, her, everyone.