19 December 2024

Pre-Christmas 'lipstick effect' in the Viennese perfumery and drugstore trade

The 'lipstick effect' describes a phenomenon where consumers gravitate toward affordable luxuries during uncertain times, a trend currently evident among Austrians. Originating during the Great Depression of the 1930s, when lipstick sales remained resilient despite widespread financial struggles, the effect highlights a desire for comfort and confidence. These small indulgences offer a sense of joy and normalcy without straining personal finances, serving as a coping mechanism in challenging periods. In Austria's current economic climate, marked by fears of job insecurity and rising costs, this phenomenon is particularly relevant. Despite these uncertainties, Vienna's perfumery and drugstore business thrives during the holiday season, driven by the popularity of beauty products as gifts.

According to Helmut Bogner, chairman of the regional committee for perfumery and drugstore retail in the Vienna Chamber of Commerce, December accounts for up to 10% of the industry's annual turnover. This Viennese retail sector employs about 3,000 people in 730 businesses and generates about €500 million annually. A recent survey revealed that 32% of Viennese shoppers will give cosmetics or perfumes as gifts this year, surpassing books as the most popular choice. Cosmetic vouchers are also popular, ensuring continued sales into January.

Trend: A shift towards well-being
Chairman Helmut Bogner stated in the press release that the people of Vienna value promoting personal well-being and giving heartfelt gifts. He noted that the trend toward a greater focus on well-being and lifestyle will continue to grow in importance in the coming years as individuals, especially in stressful times, consciously seek small breaks from their daily lives.

According to the Vienna Chamber of Commerce, online platforms dominate sales of well-known brands, while in-store shopping remains crucial for a personalized experience. Testing fragrances and receiving tailored advice are irreplaceable aspects of the physical retail experience.

Image: The picture shows Chairman Helmut Bogner handing over the Christmas bags for perfumers and druggists. The State Committee for Perfumery and Drugstore Retailing of the Vienna Chamber of Commerce supported its member companies during the Advent season with 50,000 Christmas shopping bags. Photographer: Max Slovancik. Photo: © Max Slovancik.