2024: The fragrance market is valued at $59.27 billion
2028: The fragrance market is expected to reach $67.4 billion (Statista)
This tells us something interesting about human behaviour.
Why do people love their favourite brands so much? Even when money's tight, they might still buy something from that brand, even if it's cheaper than usual.
It is called the Lipstick Effect.
In 2001, Estée Lauder's chairman Leonard Lauder coined the term “the Lipstick Effect”. It refers to consumers' tendency to indulge in small luxuries when faced with financial constraints.
But what’s the cause of this counterintuitive behaviour?
When facing economic hardships, people become more budget-conscious, cutting back on big-ticket purchases like homes, cars, or electronics. However, they don't completely forego luxury goods.
Instead, they seek affordable luxuries that provide an emotional boost without breaking the bank. This could be a fancy lip balm, a bouquet of flowers, or even a croissant from a gourmet coffee shop – inexpensive treats that offer a luxurious feel.
Sometimes, when things are tough, we like to buy little treats for ourselves, even if they’re not necessary. It's a small way to feel good and hopeful, almost like a reminder that things will get better.
Have you ever done this? Bought something to cheer yourself up? Tell me in the comments!
#brands #luxury #fragrance
Financial analyst
3moI love your makeup, I bought some for my family