A new study by researchers at Texas Christian University, the University of Minnesota, the University of Texas at San Antonio and Arizona State University has found that women buy more cosmetics and beauty products during economic recessions — and that they do it because they're trying to attract men with money.
Yes, it's that old saw the "Lipstick Index," back again.
Let's look at the key passage of the study in question. How did the researchers determine that, in fact, lipstick sales improved during the Great Recession, or any recession, for that matter?
Although spending on most consumer products during the recent recession has
predictably declined, one class of products is believed to have fared unusually well: beauty
products (Schaefer, 2008; Allison & Martinez, 2010). For instance, sales figures from one of the
world‘s biggest cosmetics companies – L‘Oreal – showed that during 2008, a year when the rest
of the economy was suffering record declines in sales, they experienced sales growth of 5.3%
(Elliot, 2008). The notion that women may spend relatively more money on attractivenessenhancing products during times of economic recession has been dubbed by journalists as the
lipstick effect (Nelson, 2001). The idea of a lipstick effect has been discussed in several recent
economic downturns and is even believed to have occurred during the Great Depression, when
sales of women‘s cosmetics products boomed unexpectedly (Koehn, 2001).
That's it? Weasel words like "boomed" and a single figure from a solitary annual report from one cosmetics company, L'Oréal? That's the basis for the assumption that American women buy more lipstick during recessions — and therefore that's also the basis for the attendant assumption that American women buy more lipstick during recessions because those skanks are trying to snag a rich man?
Let's take a closer look, because it seems the study's authors are putting a lot of stock in these numbers. First of all: L'Oréal's total global sales did not rise by 5.3% from fiscal 2007 to fiscal 2008. In fact, the 5.3% figure appears nowhere in L'Oréal's 2008 annual report. According to that report, the company's total global sales rose by 2.8% year-on-year from 2007 to 2008. Same-store sales, a key measure of retail health because it controls for store openings, rose 3.1% the same year.
Again, this is still just one cosmetics company, and these are still global sales figures that the authors of this study purport to say are somehow indicative of the consumer behavior of American women. And these are also sales figures that reflect purchases of all of the company's products: everything from every L'Oréal-owned brand is included, from Kérastase Capital Plus Homme shampoo to Kiehl's Vital Sun Protection SPF 30. Unless those sales numbers are broken down into product categories, they tell us nothing about how much lipstick was purchased in a given year in the U.S. of A.
And, by the way: L'Oréal's early-recession growth did not continue past 2008. For the first quarter of 2009, L'Oréal's year-on-year global same-store sales shrank by 4.3%. Overall in 2009 — which was a much worse year of the recession, for consumers, than 2008 had been — sales fell by 1.1%.
The lipstick index has been debunked and critically unpacked before. (We've also handled its related phenomenon, the "Hemline Index.") In a 2009 story on the dubious economic indicator, The Economist noted, "reliable historical sales figures are hard to find" for lipstick.