Google Indonesia Country Director Veronica Utami said the lipstick effect is one of the factors that has enabled e-commerce businesses in Indonesia to continue growing this year, despite the generally unfavorable economic conditions.
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The term lipstick effect is used to describe the trend of consumers purchasing small luxuries such as premium lipsticks to achieve affordable pleasure during economic downturns in an effort to maintain a sense of normalcy.
"This makes them feel comfortable, even if only for a moment, whether it's makeup , a cute bag, or running shoes. I think the lipstick effect is quite real," Veronica said in a question-and-answer session following the presentation of Google's "e-Conomy SEA 2026."
The total gross merchandise value ( GMV ) of Indonesia's digital economy is estimated to reach US$119 billion or around Rp2.1 quadrillion by 2026.
According to Google's latest report, the e-commerce sector is one of the main drivers of Indonesia's digital economic growth, with an estimated transaction value of US$85 billion, or around Rp1.5 quadrillion.
E-commerce services offer consumers a variety of shopping conveniences and comforts.
In addition, the use of artificial intelligence in e-commerce services allows consumers to view a wide selection of goods and compare product prices easily and quickly anytime and anywhere.
The use of online motorcycle taxi ordering services and digital shopping applications has become part of people's routine.
"It has become a habit that is not easy to change," said Veronica.
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