Cold economy warms lipstick sales

Drug Store News, April 7, 2003

The beleaguered economy has educated consumers on the art of frugality. And while many shoppers have axed 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 often bat around a loose economic theory dubbed the "lipstick index." While you won't find it in the pages of microeconomics textbooks, the lipstick index refers to consumption that helps consumers feel better about themselves when they face a dismal financial outlook.

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

In fact, IRI data for the 12-week period ended Jan. 26 reveals that lipstick sales ramped up 5.4 percent to $104.5 million, with Cover Girl Outlast the clear winner in the category. Cover Girl Outlast sales increased nearly 35 percent for the period. Revlon ColorStay and Maybelline Wet Shine also achieved impressive double-digit increases. New launches from Revlon and Maybelline likely will give sales even more momentum this spring. Revlon Moisturous Lipcolor with SPF 17, an almost weightless gel formula that smoothes and conditions lips, will be available this month in 24 shades for a suggested retail p rice of $7.50.

Maybelline anticipates its first long-wearing intro, Maybelline Forever Lip-color, 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 vice president of marketing for Maybelline. Maybelline Forever launched last month and retails for $7.95.