Lipstick outlasts tough economy - Health & Beauty Care - lipstick index refers to consumption that helps consumers feel better about themselves when facing a dismal financial outlook

DSN Retailing Today, April 7, 2003

The beleaguered economy of late has educated consumers on the art of frugality. And while many shoppers have axed many discretionary items from their budgets, lipstick remains one of the affordable luxuries women won't live without.

In fact, when times get tough, analysts and cosmetics companies will often bat around a loose economic theory dubbed the "lipstick index." While you won't find it in the pages of microeconomics text books, the lipstick index refers to consumption that helps consumers feel better about themselves when facing a dismal financial outlook.

Information Resource Inc. analyst Kim Fell, division president of worldwide innovation, has also taken note of the correlation between a tough economy and stellar lipstick sales.

In fact, IRI data for the 12-week period ending Jan. 26, 2003, reveals lipstick sales ramped up 5.4% to $104.5 million, with Cover Girl Outlast the clear winner in the category. Revlon ColorStay and Maybelline Wet Shine also achieved impressive double-digit increases. New launches from Revlon and Maybelline will likely give sales even more momentum this spring. Revlon Moisturous Lipcolor with SPF 17 will be available this month in 24 shades for a suggested retail price of $7.50.

Maybelline anticipates its first long-wearing intro--Maybelline Forever Lipcolor--will have staying power at retail as well. The one-step lipstick offers the comfort of a conventional lipstick with the benefit of long-wearing color, said Karen Bush, senior vp, marketing for Maybelline. Maybelline Forever retails for $7.95.