Sleeping beauty halls: how Covid-19 upended the ‘lipstick index’

With its army of perfectly groomed and manicured shop assistants, the department store beauty hall has traditionally been the backbone of a £2.5bn trade in expensive lipsticks, face creams or perfumes.

But cosmetics sales have plummeted this year as high street shutdowns, coupled with the shift to home-working, has prompted many people to ditch their makeup bags.

Sales of the designer brands sold via glossy counters in department stores are down by more than 40% this year, a decrease worth almost £500m, according to the market researcher NPD. The decline is even bigger if you throw in the £180m hit to sales of cheaper lipsticks and eyeshadows bought alongside groceries in supermarkets.

Women are simply wearing less makeup, said Alexia Inge, the co-founder of the Cult Beauty website. “The lockdown expedited trends that were already happening. People were already starting to take a different approach to makeup from the Insta-glam layer-upon-layer [look].”

The so-called “lipstick index” is often used as a barometer of consumer confidence during periods of economic turmoil. The term, which was coined by the former Estée Lauder chairman Leonard Lauder in the early 2000s, refers to the usual resiliency of cosmetics with makeup seen as an affordable indulgence when bigger purchases are out of reach.

But the index never saw Covid-19 coming, with its mandatory face-coverings that mean no one can even see your lips, let alone what colour they are. During the lockdown, demand for products many would once have considered an essential part of their daily beauty routine – such as foundation and lipstick – was down by more than 70%.

“Everyone likes to roll out Lauder’s lipstick effect … but lipstick sales are probably the worst of any category right now,” said Inge. Instead, she added, we should look at skincare, which is the “makeup equivalent” of the leisurewear people have been wearing at home during the pandemic. While Cult Beauty’s lipstick sales were down 8%, its skincare sales have more than doubled.

This dramatic shift in spending priorities is borne out in figures from the department store chain John Lewis. Its sales of skincare, body and hair products are up 234% this year, as people opt to spend time caring for their skin rather than applying makeup.

John Lewis predicts some of the changes seen this year will stay around and that cosmetics bags will get smaller as women abandon lip pencils and contouring sticks – a hard-to-do blending technique popularised by Kim Kardashian – and switch to easy to use multipurpose products, such as tinted moisturiser and lip balm.

Long periods at home have driven shoppers into the arms of Cult Beauty and its discount-driven Lookfantastic, which is part of The Hut Group founded by the billionaire Matthew Moulding. In common with other retail markets such as furniture, more than 40% of beauty sales will be online this year – almost double 2019’s level.

The failure of a major player like Debenhams, with its 124 stores and 12,000 staff, is a fresh blow for the beauty industry left reeling by this year’s lengthy salon closures.

Yes, times are tough for the high street, said June Jensen-Mills, the head of UK beauty at market researchers NPD, but store sales are likely to bounce back in 2021.

“I believe that bricks and mortar will go back to being important,” she said. “People will want to meet up with friends, try things, have a coffee. Debenhams is an important player in the world of beauty but when a retailer closes customers shift to similar retailers where they feel at home.”

There are also new powerful forces at work in the industry as the glitzy websites of blockbuster brands such as Charlotte Tilbury compete with the department stores that are also their business partners.

For shoppers the joy of the beauty hall lies in the ability to discover new brands, trial out textures, test colours and sample scents, but coronavirus restrictions mean that is, in many cases, no longer possible. But department stores brands are fighting back with innovative new ways of selling, such as virtual masterclasses and compiling “discovery boxes” of sample-sized products.

People seem to like it. Last week John Lewis and Charlotte Tilbury broke the Guinness World Records’ title for the UK’s largest ever beauty masterclass after 10,000 people signed up to “brush along at home” to create a “timeless 90s supermodel-inspired look”.

Consumers may be looking for “simplicity” now but their feelings may change in 2021. “I have a strong feeling that once we come out of lockdown, and the bars and discos are open again, things will pick up,” said Jensen-Mills. “People will think ‘I’ve had an awful year and I want to make myself feel and look great’. Let’s just slap on loads of foundation and lipstick.”

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