The Lipstick Effect

Fuel prices have jumped by more than 40% since February. The RBA has hiked rates twice in two months. And audiences are still buying tickets, just not the way they were eight weeks ago.

Every day at Anthem we crunch the data across dozens of campaigns spanning major musicals, performing arts organisations, and touring spectacles. It gives us something close to a real-time pulse on how Australians are feeling about spending on experiences.

Here’s what that pulse is telling us: people haven’t stopped wanting to go out. Engagement rates across our campaigns have held steady. Audiences are still clicking, still browsing, still watching the trailers. But conversion rates have dropped by as much as 20% since the conflict in the Middle East sent fuel past $2.50 a litre and audiences started watching their wallets.

The interest is there. The intent has wobbled.

What’s changed isn’t appetite: it’s risk tolerance.

The productions holding strong right now share one thing in common: certainty. The household names, the globally proven titles, the shows where audiences know exactly what they’re getting. When you’re tightening the household budget, a night out becomes a bigger decision. And when it’s a bigger decision, you reach for the safe bet.

What’s softened? Anything that feels like a gamble. Even productions with strong pedigrees, great reviews, genuine spectacle are seeing an impact on daily sales. Right now, it doesn’t matter how good the show actually is. What matters is whether the audience feels confident they’ll get their money’s worth before they click ‘book tickets’.

Audiences aren’t choosing to stay home. They’re choosing more carefully. And it’s a pattern we’ve seen before.

The Lipstick Effect

There’s a well-documented economic phenomenon called The Lipstick Effect. During the Great Depression, industrial production in the United States halved, but cosmetics sales rose by 25%. Directly after 9/11, lipstick sales jumped 11% while most consumer spending cratered. During the 2008 recession, the same pattern repeated. Cinema attendance also boomed during the Great Depression.

People cut back everywhere else and still went to the movies.

The theory is simple: when times get tough, people don’t stop wanting to feel good. They stop spending on the big things like the house deposit, the new car, the overseas holiday and redirect towards smaller pleasures that deliver an outsized emotional return. A $40 lipstick feels indulgent without being reckless.

Live entertainment operates in exactly this space. It’s not a mortgage payment. It’s a night that makes you forget about mortgage payments. But only if the audience trusts the experience will deliver.

What this means for productions right now

Audiences are already interested. The engagement data proves that. The gap is between interest and commitment, and closing it comes down to two things:

De-risk the experience. Lean hard into proof of quality. Critical and audience reviews. Behind-the-scenes footage that lets audiences feel the scale and energy of the production before they commit. Don’t be afraid to show elements of the show that might have previously been gatekept as ‘a surprise’. Use your best assets to prove to audiences it’s a safe bet. Leverage known IP and look for ways to make something that's risky feel anchored in something familiar and reassuring. Every touchpoint should answer the question: ‘Will this be worth it?’

Lead with value. Audiences are conditioned to look for deals right now, and they’re not ashamed of it. Entry-price messaging like “tickets from $XX...” or “save $XX...” isn’t cheapening the brand. It’s meeting the audience where they are. It’s the difference between an audience member thinking ‘I can’t afford that’ and ‘I can make that work.’ More often than not, we see audiences click through on entry price messaging and opt for the more expensive seats. It helps audiences walk in the door, when they would otherwise walk past.

What's next?

What we’re living through right now isn’t unprecedented. It’s cyclical. Events of the last month have compressed a cost-of-living squeeze that was already building, and although petrol prices have dropped, the rising interest rates continue to put pressure on household budgets.

But Australians haven’t lost their desire for live experiences: the data is clear on that. They’re just being more deliberate about where they spend. And the productions that make the purchase feel safe, feel valuable, and feel like the smart choice will be the ones that hold their ground. 

The Lipstick Effect tells us that people will always find room in the budget for something that makes them feel good. The question for our industry is whether we’re making it easy enough for them to choose us.