For many consumers, cosmetics blur the line between a want and a need.
Case in point: I want to wear lipstick. Do I need a dozen shades of pink and red lipstick? Well… yes.
Wearing makeup — and having plenty of options in my makeup bag — makes me look and feel better, even if I’m just working from home. (Hey, I like to be prepared for video calls.)
Judging by the global revenue in the beauty and personal care market — projected to be $677.19 billion in 2025, per Statista — I’m not alone in my “need” for a healthy stash of makeup and skincare products.
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I’m also probably not alone in scaling back my beauty budget in the face of inflation. I’ve been averting my eyes from my inbox and text messages, which are loaded with promotions from my favorite brands. I’ve also been scoping out product dupes among traditionally lower-priced drugstore brands.
Related: Struggling cosmetics brand sounds alarm, laying off thousands
However, the recent announcement from a popular budget-friendly brand might mean it’s time to refrain from drugstore “splurges,” too.
Image source: E.l.f. Cosmetics
E.l.f. Cosmetics announces price increases
E.l.f. Cosmetics has forged a reputation as an affordable, yet high-quality makeup that’s a hit with both drugstore and online consumers. But as inflation and tariffs loom, the company is raising its prices.
The brand made the announcement last Friday on Instagram in true Gen Z speak. The caption reads: “Starting August 1, our prices are going up by $1.* Bringing you the best of beauty is getting more $$$ but we’re committed to keeping the quality high and prices e.l.f.fordable. We are keeping an 👀 on the tariff situation as it evolves.”
Now, $1 doesn’t exactly sound like a wallet-buster. However, the percentage is the real eye-opener: a $2 product increasing to a $3 product represents a 50% increase. That’s a big deal.
The company says that even with the increase, 75% of its products will remain priced at $10 and below, like lip oil ($9), lip liner ($3), concealer ($8), and brow lift ($7). To be fair, you could fill up a makeup bag with all the basics and still have it cost less than, say, a tube of Chanel lipstick.
But e.l.f. Cosmetics customers are not typically Chanel customers, and vice versa. It’s the budget-minded consumers who will bear the brunt of the increase.
And in light of other big E.l.f. news, some are not happy about it.
Related: Kylie Cosmetics owner makes a harsh decision
E.l.f. bets big on its future with a billion-dollar deal
News of the price increase was overshadowed by even bigger news this week: E.l.f. acquired Hailey Bieber’s Rhode in a $1 billion deal.
On the Instagram post announcing the price increase, comments ranged from “We e.l.f.ing LOVE YOU❤️🫶🏼” (@emuxly) to “I guess you need your customers to pay the 1 billion you spent on Rhode…” (@the.other.fraggle).
Fair point.
Premium brand users will still find E.l.f. products are cheap at twice or even three times the price, but those who rely on the budget brand as their beauty routine mainstay will take the hit.
More Retail:
- Forget the Birkin bag, Hermès unveils something unexpected
- Costco shares surprising pricing news as tariff pressures increase
- Starbucks makes major change in rewards program loyal fans will hate
The company attributes the price increase to the impact of tariffs and inflation. But a billion-dollar deal suggests that the company isn’t exactly in economic danger. In fact, it indicates that E.l.f. is banking on a bright future with its Gen Z and now Gen Alpha customers.
