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Splurging may be surging this holiday season: survey finds 40% of beauty buyers will use credit or BNPL to afford gift giving.
FORT LAUDERDALE, Fla., Dec. 7, 2022 /PRNewswire/ -- The nation's largest provider of debt solutions finds a spike in beauty-product buying that corresponds with record-high core inflation rates and an increase in consumers buying cosmetics using credit.
Debt.com's analysis builds on a concept discovered two decades ago. Leonard Lauder coined the "lipstick index" in 2001 as a recession indicator. As chairman of Estee Lauder Cosmetics, he noticed that a rise in lipstick sales and other cosmetics often meant the opposite of what many people thought. Instead of a sign of disposable income, it was a sign of tight budgets – because when consumers can afford less, they buy small luxury items instead of larger ones.
The research team compared the inflation rate to Google's search volume for the terms "lipstick," "lip gloss" and "foundation" finding a significant uptick in consumers searching for those products. The debt relief organization then commissioned a survey of 1,000 beauty buyers finding that 38% are using credit to buy cosmetics, while 37% are buying more despite inflation which economists predict will remain high.
"Credit card debt is rising, and Americans are carrying $887 billion of it. Now is not the time to get into holiday debt," says Vicki Gunvalson, spokesperson for Debt.com and former Real Housewife of Orange County star.
"With 40% planning to finance makeup and beauty products for holiday gifts using either Buy Now, Pay Later or credit cards, they are creating debt that will follow them into the new year. Social pressures and social media influencers lead people to purchase items that are out of their budget resulting in many turning to credit to pay for the latest products," continues Gunvalson.
"We'd like to think we're making affordable choices by splurging on small items during hard times," says Gunvalson about the survey findings. Other survey results include:
"Prioritizing financial wellness and careful money management is especially important right now, as the U.S. might be headed for some rocky times financially," says Gunvalson.
ABOUT: Debt.com is the consumer website where people can find help with credit card debt, student loan debt, tax debt, credit repair, bankruptcy, and more. Debt.com works with vetted and certified providers that give the best advice and solutions for consumers 'when life happens.'
Sources: Higher Income Consumers Increased Spending on Beauty Products by 14% in 2022 - The NPD Group
Consumer Price Index - October 2022 (bls.gov)
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SOURCE Debt.com