The ‘lipstick effect’ theory emerged during the 2001 recession in the US. Generally, sales decline during any recession. But at that time, Leonard Lauder, chairman of cosmetics company Estee Lauder, had announced that lipstick sales had increased during the recession. He was the first to use the term ‘The Lipstick Effect’. This theory became very popular. There are two strong explanations behind this.
As people’s income decreases, the demand for luxury goods falls. But interest in less expensive luxury items increases. Another explanation is that, during economically difficult times, people try to pamper themselves to feel better and forget their troubles. That is why the sale of lipstick increases in times of economic recession. That’s why American economists keep an eye on lipstick sales to determine whether there is a possibility of a recession.
There is no record of commodity-wise retail sales available in Bangladesh. But whether the sale of lipstick has increased or not can be judged from the import records. According to National Board of Revenue records, 40,775 kg of lipsticks and lip-related products have been imported in the last four months from July to October of the current financial year. In the same period of the financial year 2022-23 it was 26,853 kg. So as per official records, the import of lipstick has increased by 52 percent.