Lipstick Write for Us
The Lipstick Effect theory states that when facing an economic crisis or the economy is in a recession, and customers will be more willing to buy less costly extravagance goods. For example, instead of buying luxurious fur coats, women will instead acquisition expensive lipstick or luxury cologne.
The underlying insinuation is that consumers will buy luxury goods even if there is a crisis. When consumer self-confidence in the economy is low, people will buy goods that fulfill luxury indulgences without breaking the bank. Outside the cosmetics market, consumers could purchase luxurious beer or pick an Audi over a Ferrari.
The Economist tested the lipstick effect in 2009 with statistical analysis. They concluded that based on data collected by Kline & Company, a market-research group, the product had been overstated. The team at the Economist was unable to derive a solid correlation from proving the effect.
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