Lipstick Effect

Lipstick Effect: A theory that states that during periods of recession or economic downturn, consumers will avoid purchases of luxury items and seek material solace in smaller indulgences, such as a premium lipstick.

This is the reasons why during recessions consumers want to still treat themselves but cannot afford luxury items. Therefore, they often settle for dining out and going to a movie or just buying a new designer lipstick!

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