Inflation remains high. So does consumer spending. On this week’s Halloween episode of “Behind the Numbers: Reimagining Retail,” our analysts looked at a few silly and even spooky indexes for evaluating consumer behavior during times of economic constraint.
The “lipstick index”: During economic hardship, consumers buy more lipstick because it’s a relatively inexpensive and justifiable luxury. At least, that’s what Estée Lauder’s chairman claimed when coining the term back in 2001.
The “men’s underwear index”: This phenomenon claims men’s underwear sales go down when people have less money to spend, and that they go back up as financial tension eases.
Halloween and holiday spend: Despite prices going up, shoppers will spend an all-time high $10.6 billion on Halloween this year, according to the National Retail Federation. And 36% of Americans will spend more on Halloween this year than they can afford, according to Lending Tree. Is Halloween spending seeing a “lipstick index” style trend?
What does this mean for retailers? “When times are tough, people don’t want to just trade down to the bare-bones minimum,” said Davidkhanian. Brands should take note. “If you don’t have these small, premium, impulse luxury items, then think about selling a suite of products that is fun but affordable.”
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