Listen to this: The average American woman will spend approximately $15,000 on cosmetics in her lifetime. Yes, 15 thousand.
Surprised? It doesn’t end there — let’s talk about makeup pricing.
Makeup is important for many people, and decorating our faces has been a staple part of human culture since time immemorial.
But why is it so expensive? We hear a lot about quality organic ingredients, ethical manufacturing practices, and other factors that supposedly drive up makeup prices. But, in truth, that’s not the whole story.
Read on for three key beauty insights. By the end, you’ll know why makeup is so expensive and how to minimize the unnecessary costs of major cosmetics.
Makeup’s True Cost: A Breakdown
When you see a $20 tube of lipstick at the grocery store, that $20 is not paying for the cost of the ingredients themselves. In fact, that $20 pays far more for marketing and shipping costs than you think. Let’s break down the true cost of makeup by each element: ingredients, packaging and shipping, and marketing.
Cost of Ingredients
Would you be surprised to learn that, according to cosmetic chemists, ingredients for makeup only account for about 15% of their total prices? That’s the truth!
Indeed, it doesn’t matter whether you pick up so-called organic or ethically sourced makeup products or consciously use products made with sustainable shipping and manufacturing practices. Overall, all the ingredients in any given makeup product account for just 15% of the shelf price.
So, if we look back at our $20 tube of lipstick example, all of that lipstick tube’s ingredients cost about $3.
Cost of Packaging
Most of the cost of any makeup product comes from packaging, shipping, and marketing. The exact ratios aren’t fully known and vary from product to product and brand to brand. However, on average, packaging and shipping costs account for nearly 50% of the total price of a makeup product.
That means, for our $20 lipstick tube example, the price for decorating the lipstick tube, shipping it from place to place, and coming up with an art style that resonates with consumers accounts for about $10 of that shelf price.
Packaging has become a major factor in rising cosmetic prices over the last few decades. That’s partially because packaging and the appearance of makeup products on the outside are driving factors in whether consumers purchase them or not. Furthermore, many makeup products are shipped worldwide or internationally to reach their end-users. That does cost quite a lot for makeup companies, despite price reductions thanks to economies of scale.
In many cases, when you shop at a high-end makeup store, you’re not really paying for overall better ingredients. Instead, you’re paying for brand recognition, display areas, and the cosmetic experts who can ostensibly help you find the best cosmetics for your needs.
Cost of Marketing
The other 35% of the lipstick tube’s price, or approximately $7, is due to marketing costs. This isn’t entirely unexpected, of course. The cosmetic industry is highly competitive, and brands have to convince consumers to pick up their products as opposed to others.
That means lots of money pours into marketing departments in the cosmetic industry. Marketing, in this sense, includes online or TV ads, marketing campaigns and deals with celebrities to represent their products, and much more.
Still, this price breakdown illustrates a major potential issue in the makeup industry overall. Most of the prices consumers pay aren’t for the ingredients or the actual products at all. It’s for ancillary, somewhat abstract costs that might be lower were it not for certain industry practices.
Why has marketing become such an expensive part of makeup production? It’s largely because of increased competition. There are more makeup brands than ever before, and it’s increasingly difficult for consumers to choose the right brand for their needs.
After all, if two brands appear to be almost identical in terms of what they offer, how can you choose the best one? It often comes down to small price differences or the effectiveness of marketing campaigns, like hiring one actress or another to advertise a brand’s makeup products. As competition has increased, so too has the importance of marketing online and in person.
“High-End” Makeup Isn’t Necessarily Better
The second beauty insight is that so-called high and/or high-quality makeup isn’t necessarily better than store-brand stuff you can find for much cheaper. Again, because most makeup product prices do not account for the cost of their ingredients, there isn’t much of a chemical or physical difference between two products as you may think.
Therefore, lots of people may purchase highly expensive makeup, thinking that they are getting a great deal since the products they use will be better for their skin or better for the environment. In truth, that’s not really the case.
When you buy high-end makeup, you pay for:
- The brand name and recognition. For example, many people like to stick with brands over the long term due to customer loyalty. Others may like to purchase well-known brands of cosmetics as a form of social competition or recognition.
- The fancy displays at stores. There’s no denying some of the highest-priced makeup looks much better on a surface level than lower-priced makeup products.
Is this enough to justify the monumentally higher costs of some “high-end” makeup products compared to store-brand makeup? It’s up to you to decide that for yourself!
Price Doesn’t Equal Quality
By the same token, here’s a third insight: the price is not necessarily a good proxy for quality. There’s little difference between a $20 tube of lipstick and a $50 tube of lipstick if they are both essentially the same shade when all is said and done.
It’s a much better idea to research individual ingredients, then look up what makeup products have the best ingredients for your skin or the environment. If, for example, you find two nearly identical makeup products with the same ingredient compositions, but one is much cheaper than the other, it might very well be smarter to choose the cheaper product and save your wallet a bit of strain.
We know this makes choosing excellent makeup products a bit trickier. But it’s something all cosmetic consumers should be aware of the next time they go shopping for foundation, eye shadow, or anything else they use.
Bottom line: the price of a makeup product reflects what consumers are willing to pay for it more than it reflects the product’s value, quality, or any other factor.
Pro Tip: Know What You’re Looking For
So, how can you navigate the surprisingly complex world of commercial cosmetics? As a consumer, you are somewhat limited in terms of ingredients sourcing and ethical manufacturing practices. You have to buy what people provide, of course.
However, to save money and to avoid paying money unnecessarily to marketing firms, you should enter a makeup store knowing exactly what you’re looking for. Do your research beforehand. For instance, if you need lipstick that will last for the entire day, go for a lipstick product designed to do just that.
It may also be wise to compare two similar makeup products against one another in the store. By law, makeup products have to be upfront about their ingredients. Those ingredients should be on the packaging. You can simply flip two similar products around, look at their ingredients, and determine whether there are any major differences between the two aside from cost or packaging.
Don’t change your mind and go for the big brand lipstick just because it looks a little fancier on the shelf. All that’s doing is cheating your wallet out of a few extra bucks that could be better spent almost anywhere else. Expensive does not necessarily mean better.
Overall, makeup is pretty expensive and will likely keep rising in cost for the foreseeable future. Eventually, the marketplace may shift in makeup could become more affordable for the average consumer. Until that time, it’s a good idea to read up on makeup ingredients and products so you can be an ethical consumer and so you can save money on high-priced makeup stuff you don’t really need.
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Why is makeup so expensive? | Quartz
Is High-End Designer Makeup Worth It? – 7 Things to Consider | Moneycrashers.com