With over 600 respondents, The Review Works, an online reviews platform asked if rate increases and inflation have changed how they (the respondents) shop for beauty products – And a whooping 83 per cent of respondents said it had.
83 per cent of respondents confirm that the recent rate increases and inflation has changed how they shop for beauty products. 53 per cent now take longer to decide on what they will purchase, while 43 per cent saying they will focus on quality over quantity.
The Beauty industry has long considered itself relatively recession proof, often referencing the ‘Lipstick Effect’ a term coined by Leonard Lauder in 2000 following the bursting of the dot-com bubble. Even more recently, throughout the Covid-19 Pandemic, skincare brands and online beauty businesses experienced unprecedented growth.
But could the RBA put an end to the theory? Alex Noonan, director of The Review Works, thinks it could be an opportunity for the beauty industry.
“What our community has said is that inflation is impacting their purchasing decisions. They are less inclined to buy on a whim, and are looking for quality over quantity. I think the Lipstick Effect is still very much a part of how consumers shop, but in 2022, they are buying one lipstick, not three. Which means for brands focusing on results and benefits of a product and letting go of superficial campaigns will be key. And of course, reviews play a very important role in that strategy.”
