2025-05-12
The Lipstick Effect
Hello World,
I'd like to share an interesting story I came across.
After the 2001 Attacks, cosmetic company, Estée Lauder noted that their company sales of lipstick went up. Later, owner Leonard publicized the Lipstick Effect, a hypothesis that in times of economic crisis, consumers are more likely to buy less costly luxury goods.
Instead of buying expensive purses and fur coats, for example, people will buy expensive cosmetics, such as high-end brands of lipstick. The underlying assumption is that when consumer trust in the economy is dwindling, a certain portion of consumers will still buy luxury goods even during a bad economy.
Why am I talking about lipstick?
Why would this phenomenon be unique to the cosmetic industry? 2025 has been a rocky year economically, thanks to the US Tariff Trade War. So where do people turn to? The answer is board games.