Lipstick Effect: Luxury Beauty Sales Boom


It seems there is something especially alluring about a fancy lipstick these days: The NPD Group reports that year-to-date dollar sales of prestige cosmetics are up 9% through May, or $1.4 billion. (May sales are up even more, at 11%.)

Those gains, however, make quite a contrast to the luxury market in general. Unity Marketing, which tracks consumer confidence among America's most affluent shoppers, is reporting the steepest quarterly plunge since the recession in its Luxury Consumption Index.

"Consumer confidence among the affluent -- the economy's heavy lifter segment which accounts for only 20% of households, but over 40% of spending -- has fallen sharply since the beginning of 2011. Not since the middle of 2009 has it been so low," Pam Danziger, president of Unity Marketing, writes in the report. "If those at the top income levels feel stressed and unwilling to spend, imagine what it says about people living in middle-income households."



The average amount spent by affluent consumers on luxury goods and services in the second quarter 2011 declined by 8.4% from the first quarter and tumbled 18.4 % from the same quarter last year.

Apparently, high-end cosmetics are an affordable splurge, as women snapped up new products to help them achieve dramatic eyes, soft lip shades, and bold and bright nail colors, NPD says.

Nail color and products grew by a whopping 57%, with many priced under $20, led by Chanel Le Vernis Nail Enamel, Lippmann Collection Nail Enamel and Estee Lauder Pure Color Nail Lacquer.

Lip color sales were also especially bright, up 13%, with MAC Lipstick, Lancome L'Absolu Rouge and Chanel Rouge Coco Shine the top 3 sellers.

Lancome Definicils High Definition Mascara, Clinique High Impact Mascara, and Lancome Hypnose Drama Mascara were the three top-selling mascaras.

"As consumers continue to gradually emerge from the great recession, the current sentiment among women seems to be 'celebrate your girlhood,'" NPD notes in its release. "Pink, pink, and more pink, continues to lead the way in both lip and nail color."

1 comment about "Lipstick Effect: Luxury Beauty Sales Boom ".
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  1. Patricia Friedlander from Word-Up!, August 1, 2011 at 12:21 p.m.

    I read once that during times of a troubled economy, a new lipstick is considered a wonderful indulgence at an accessible price point. I think I read it during a previous recession.

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