It is said growing lipstick sales are traditionally observed during recessions. The "Lipstick Index" has been used as a barometer of economic activity since the term, coined by Leonard Lauder, chairman of cosmetics group Estee Lauder in 2001, indicates the tendency of women to turn to lipsticks when they cut back on other cosmetic items during recessions. However, the saying might need to be revised. In the current economic downturn, foundation has been selling better than lipsticks, according to the Financial Times on April 11.
Women tend to buy foundation that can cover facial flaws, rather than lipsticks. According to research firm AC Nielsen, sales of foundation grew 15 percent in the U.K., while lipstick sales recorded a meager 2.5 percent increase. In the U.S., sales of foundation rose 2.5 percent, while lipstick sales posted -5.8 percent growth, according to Kline & Company, a market research firm.
In a survey of British women aged 18 or 19 by L'Oréal, the world's largest beauty company, more than 30 percent of respondents said foundation is "essential." Meanwhile, only eight percent of those surveyed cited lipsticks as their most essential beauty product. The preference for lipsticks was most noticeable in respondents in their 60s or over (40 percent), revealing generational differences in preference for cosmetics.