Business Opportunities Weblog

May 6, 2008 by Rich Whittle | 3 Comments

The New York Times:

Last month, Betsy Stein made a beeline for Bloomingdale’s to buy a shirt, but the top she found was $280. Stein, told herself that in the current economic climate, she shouldn’t charge it.

“With the scare of the downturn,” she said, “I decided to cut back on my shopaholic problem and exercise some restraint.”

But the next day at Sephora, she made a substitute purchase. “I could buy one or two lipsticks for about $40,” she said. “That’s far less than $280.”

Ms. Stein’s rationale for buying lipstick echoes a theory once proposed by Leonard Lauder, the chairman of Estée Lauder Companies.

After the terrorist attacks of 2001 deflated the economy, Mr. Lauder noticed that his company was selling more lipstick than usual. He hypothesized that lipstick purchases are a way to gauge the economy. When it’s shaky, he said, sales increase as women boost their mood with inexpensive lipstick purchases instead of $500 slingbacks.

With the specter of another recession, brands like Clinique and DuWop Cosmetics are preparing for a big year in lip color, for two reasons.

First, they would like to see a return to lipstick, which usually costs slightly more than gloss. Second, the companies believe that in down times women will continue to splurge on lip lacquer even as they make do with last season’s dress.

Photo by MSDesigns.

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Tags: Fashion, Trends, Women