Lip balm boom as Brits turn to lipstick effect during economic squeeze

New figures are revealing the resurgence of the so-called lipstick effect, as Britons embrace modest luxuries in the face of continued financial pressure. The latest data from market analysts Circana show sales in the UK prestige lip product sector climbed 16 per cent year-on-year to £80.4 million in the six months to the end of June. This rate of increase is almost double that of the wider make-up category and more than three times the rise seen in sales of eye make-up, clearly highlighting a trend towards affordable self-indulgence.

The lipstick index, a concept introduced by Estée Lauder’s former chairman Leonard Lauder, describes the phenomenon where small luxury purchases grow in popularity during challenging economic times. Even as consumers cut back on higher-ticket items, demand for small treats remains robust. The current figures indicate that this behaviour is once again playing out across the UK as households navigate inflation and rising costs.

The overall beauty sector has retained relative strength, with shoppers increasingly seeking comfort through cosmetics and skincare. According to June Jensen, vice-president at Circana’s UK prestige beauty team, many consumers are becoming more selective with their spending, yet still treat themselves to cost-friendly luxuries such as lipstick to help boost their mood. She notes these types of purchases can offer much-needed moments of personal pleasure and brief respite from wider economic anxiety.

The market has evolved beyond the simple bold red or subtle nude. Customers now demand extra benefits, with particular interest in hydrating balms and oils, which saw a year-on-year sales jump of 21 per cent. Products are being chosen not only for their colour but also for their ability to moisturise or deliver additional skincare claims. Tinted balms, overnight lip masks and items containing sun protection or anti-ageing ingredients have rapidly grown in popularity.

This surge reflects the influence of social media and celebrity endorsements. Promotions by influencers and pop figures such as Charli XCX—brand ambassador for Laneige—have played a prominent role in propelling lip-care purchases. Recommendations online continue to broaden the market, attracting new demographics and keeping the category at the forefront of beauty spending.

Circana’s data suggests that the lipstick effect is likely to endure, and may soon extend further into other areas of the cosmetic sector. Tinted moisturisers, concealers, setting sprays and powders—especially those offering skincare benefits—are well positioned to become the next affordable luxury favourites during ongoing financial uncertainty.