The “Lipstick Indicator”

DISCUSSION TOPIC: Times are tough, so women are shopping – for lipstick


In an article on the Australian site The Age they report:

Interest rates might be rising and food and fuel prices soaring, but it is going to take much more than that to wrest a woman away from her favourite lipstick.

Industry experts, including Steve Ogden-Barnes of the Australian Centre for Retail Studies at Monash University, say cosmetics is one category that is “recession-proof”.

“When things get tight, people might put off buying the new plasma or the new sofa, but there is no way a woman is going to leave the house without her make-up on,” he says.

In fact, there is a widely held belief that when times get tough cosmetic sales not only survive but thrive. They call it the “lipstick indicator”.

Originated by Leonard Lauder, chairman of the Estee Lauder Group, in the wake of the 9/11 attacks when lipstick sales in the US doubled, the theory goes that when things get tough women seek comfort in feel-good items. And while they may not be able to afford a $3000 handbag, they will fork out up to $30 for a lipstick.

Discussion questions:  Do you believe in the “lipstick indicator”?  Is it or will it hold true in America as in Australia?

My post:

My own unofficial polling of cosmetic industry professionals indicates that the “lipstick indicator” has largely held up over the years.  However, today’s economic issues have made even cosmetics businesses less than robust. The Aussies have the benefit of their commodities-based economy (somewhat similar to Canada in this regard) to bolster weaker areas and offset price hikes.  The US is suffering worse than most of the overseas economies and this is causing slackening business even in the cosmetics world, although not as severely as in other product categories.  In this way, the “lipstick indicator” continues to hold true.

Mike Osorio, your Dare to be Contagious! TM strategist

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One Response to The “Lipstick Indicator”

  1. msnotty says:

    A very interesting article! Thanks for posting this. “The Lipstick Indicator” never occurred to me.

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