During a recession, consumers tend to shift their spending from large items to more affordable small luxury items. Men are more likely to buy an expensive beer than new hunting gear, and women are more likely to buy lipstick rather than a new coat. Thus, the Lipstick Effect.
The phenomenon was discovered after WWII when consumer spending dwindled, yet lipstick sales soared. “What we saw was a consumer trying to make themselves feel better through small, indulgent, hedonic consumption.”*
People still want to feel pampered and making smaller feel-good purchases can help them do so. So the question is what product or service can you market as “lipstick”?
Here are some questions to help pinpoint what your “lipstick” product or service is:
1. What small product or service do you offer, but not focus on? (Make it a focus!)
2. What small product or service can you market as a feel-good item?
3. How can you change your advertising to highlight your product or service as an affordable luxury?
Remember people are still spending money; they’re just spending it differently.
Questions or comments? Email us: info@premiereditor.com
