Beauty is one of the fastest-growing segments of the global consumer economy and is a category that is a constant reflection of the world it sits within. In a post-war 1950s, consumers were growing in affluence and so best-selling products were bold lipsticks and winged eyeliners; 20 years ago, as the UK came into a recession, high street makeup brands like Maybelline and Barry M were the most sought after; today, as economics and politics become more volatile, and AI is being woven into every element of our lives, beauty has become more about wellbeing when it comes to skin, body and hair.
However, despite real household incomes being under pressure across most major markets for the better part of three years, global beauty sales have grown 10% according to NielsenIQ’s State of Beauty 2026 report, outperforming almost every other consumer category. This is not a coincidence. The so-called lipstick effect – the well-documented phenomenon whereby consumers trade big-ticket spending for small, affordable indulgences during economic downturns – has been noted since the Great Depression, when cosmetics sales rose as industrial output halved. The underlying logic is consistent: when large purchases are out of reach, small ones that deliver a tangible sense of control, pleasure or self-care become even more valuable.
“It is a category people are turning to for more than simply improving their appearance, but to feel, in a small and manageable way, better about the world they are in.”
This is visible across culture more broadly right now. Reboots, reunion tours and legacy sequels which have dominated film, television and music, are driven, as analysts have noted, not by a lack of originality but by a consumer appetite for comfort and familiarity in uncertain times. Beauty is part of the same pattern. Skincare over colour, routine over experiment, feeling well over looking perfect. It is a category people are turning to for more than simply improving their appearance, but to feel, in a small and manageable way, better about the world they are in.
Conversely many businesses have felt this pressure intensely and this has meant that there has been a direct consequence on internal agendas such as diversity and inclusion – our previous research has shown that when budgets tighten and priorities are forced into a hierarchy, representation and inclusion are often among the first things to slide. Although beauty is not immune to those pressures, the lipstick effect insulates it in a way that isn’t true for most consumer sectors as, while commercial and economic pressures still exist, they are less obstructive than in other industries. Therefore, beauty has more space than most to look within and take questions about representation and inclusion more seriously than ever.
That is the context with which we have published our third Diversity in Beauty report, which we have produced in partnership with CEW. It is clear that beauty is not failing on inclusion and in several respects it leads. LGBTQ+ inclusion is more culturally embedded here than in most adjacent sectors, diverse talent is entering the industry at more levels than five years ago, and external representation has moved forward. However, although the foundations are strong, the formal structures that would usually make that progress visible and accountable have slipped in more ways than the headline numbers show.
Some of the diminishing of formal strategies reflects genuine evolution. Some businesses which are embedding inclusion into how they operate, rather than housing it in a standalone strategy, are in that next phase of maturity where it has become part of the culture. But without the formal structures, budgets and targets that make progress visible, it becomes more challenging to track. The same is true of the language: diversity is giving way to inclusion across the industry, and that change is not as straightforward as it sounds. In the best cases it signals a more mature understanding of the work, and a recognition that representation is only the beginning. In others it risks becoming a way of stepping back from harder questions about who is hired, who advances and who holds power.
“Although the foundations are strong, the formal structures that would usually make progress visible and accountable have slipped in more ways than the headline numbers show.”
Beauty’s workforce is predominantly female, and its consumer base even more so. And yet the Chair, CEO and CFO positions at the largest global beauty companies remain disproportionately male, something that has not improved since 2023. At first look it might seem like this is a pipeline issue, and there isn’t diverse talent there to progress – but this is not the case. The stalling is happening at the very top level, where tenures are long, succession is narrow and the same profiles are the ones that are able to move most easily through the system. These are the people making the decisions about a category that is, at its core, about how others feel. When 69% of beauty’s total workforce is made up of women, this feels like an obvious imbalance that is one of the sector’s biggest issues.
None of this diminishes what beauty has built. The sector has genuine cultural advantages that most industries would not know how to replicate, and the consumer relationship it has developed, particularly at this moment, is a commercial asset of real value. That relationship is built on trust, and the wellness era only deepens it: when people are spending on beauty to feel better about themselves and the world around them, the bond between consumer and brand becomes more personal.
Beauty has always reflected the world it sits within, and right now the consumers driving its growth are more diverse than ever. The workforce delivering it is predominantly female, and the culture it has built around self-expression and belonging is one of its greatest commercial strengths. The instinct that has allowed the sector to read economic and cultural moves is what has kept beauty moving forward, and becoming a more accurate reflection of its own customer base is part of that same process. Although it is clear that there is still some way to go, it is already on the path and doing what it has always does best: adapting, evolving, and eventually, progressing.
