The lipstick index is used to describe the phenomenon where the sales of lipstick increase during the time of recession. The reason stated by the phenomenon is that during the time of recession, people try to make themselves feel better by treating themselves with something small, as they are not able to afford luxury items.

The term “lipstick index” was coined by Leonard Lauder, the former chairman of Estée Lauder Companies, during the 2001 recession. He noticed that during tough economic times, sales of lipstick tended to go up, and he theorized that this was because people were turning to small indulgences to make themselves feel better.

While the concept of the lipstick index is primarily anecdotal, there have been some studies that suggest a correlation between economic downturns and increased sales of beauty products, including lipstick. Here are a few examples:

  • During the 2008 financial crisis, sales of beauty products increased by 5.3% in the United States, according to market research firm NPD Group. While there isn’t specific data on lipstick sales, it’s worth noting that lipstick is one of the most popular beauty products, so it’s likely that it contributed to the overall increase in sales.
  • A study published in the journal “Psychology & Marketing” in 2010 found that during times of economic uncertainty, women tend to buy beauty products as a way of boosting their self-esteem. The study surveyed women in the United States and Canada, and found that those who were more anxious about the economy were more likely to buy beauty products.
  • In 2016, cosmetics company Estée Lauder reported an increase in sales of “affordable luxury” products during the Brexit vote and the US election. While the company didn’t specifically cite lipstick, it’s worth noting that lipstick is one of the most popular affordable luxury beauty products.

It’s important to note that while these studies suggest a correlation between economic downturns and increased beauty product sales, they don’t necessarily prove that the lipstick index is a real phenomenon. It’s possible that other factors, such as marketing or cultural trends, could be driving the increase in sales.

Overall, the lipstick index can be a useful tool for understanding consumer behavior during economic downturns. While it may not be a perfect predictor of economic trends, it can provide valuable insights for companies and policymakers.