The “lipstick effect” describes an interesting economic phenomenon wherein lipstick sales surge during economic downturns, a phenomenon also known as the “preference for low-cost products trend.” When the economy experiences a slump, lipstick sales tend to increase linearly.
This is attributed to the fact that lipstick is a relatively affordable luxury item. In times of economic hardship, individuals still harbor a strong desire to consume, prompting them to opt for less expensive luxury goods. Acting as an economical, non-essential product, lipstick offers psychological comfort to consumers, particularly when the soft and moisturizing texture of the lipstick comes into contact with their lips.
Moreover, economic recessions curtail the purchasing power of certain individuals, leaving them with surplus funds that can be directed towards acquiring reasonably priced non-essential items
