WOMEN are still finding room in their budgets for an Elizabeth Arden lip plumper or a Guerlain's KissKiss maxi shine - and men are following suit.

"In the last quarter our sales have been very robust, almost as robust as pre-Christmas," Emanuel Perdis, Australasian managing director of make-up group Napoleon Perdis, said

"Bronzer and foundations have been going very strong, they were the strongest, and lip gloss has also been quite good, too."

Raghu Rajakumar, a senior industry analyst with IBISWorld, estimates that in 2008-09 the cosmetics and toiletries will generate retail revenue of $2.1 billion, growth of 1.7 per cent on the previous year.

"This year is seeing a trend towards consumers seeking products offering value for money as doubts about the economy sees them alter spending habits and tighten discretionary expenditure," Mr Rajakumar said.

"In bad times, consumers turn to small luxuries such as lipsticks and make-up."

When the David Jones chief executive officer, Mark McInnes, surprised the market with a substantial profit upgrade last week he nominated cosmetics as the department store's best-performing division, with women's accessories also ringing up better than expected sales.

The nation's biggest department store owner, Myer, issued its own earnings upgrade last month, and it, too, has reported more traffic along the perfumed laneways of its cosmetics department.

National statistics released last week show department store sales in May rose 5.5 per cent, compared with growth in overall national retail sales of 1 per cent. The rise trounced the other consumer goods such as newspaper, books and stationery (which were down 2.5 per cent) and domestic appliances and music (down 2 per cent).

Department store sales also showed greater growth than supermarkets and grocery stores, for which turnover grew only 1.3 per cent.

Mr Rajakumar said that if the economic climate remained uncertain, consumers would be forced to crimp their expenditure.

But relatively less expensive products, such as lipstick, should be largely quarantined from the change.

"Recession-proof" products could be introduced this year and next, he said, by manufacturers attempting to retain brand loyalty by introducing smaller products at various price levels, including luxury segments.

"For example, L'Oreal is to introduce cheaper products for its mass premium brands, Garnier and L'Oreal Pari."

In October, Napoleon Perdis launched a cosmetic range for the budget retailer Target which has sold well and is one of the chain's leading brands.

Cosmetics companies have also realised there is money to be made in a recession by catering to the other half of the market: men.

The "manscaping" and "metrosexual" bandwagon has meant potions, lotions and creams for vainglorious men now compete for space with rouge and nail polish at the cosmetics counter.

One of the successes of winter has been the launch of Diesel's Only The Brave fragrance for men.

"Having a new fragrance

that smells nice all day

and doesn't cost a lot is a

nice affordable luxury," Mr Gregory said.

Businesses such as L'Oreal, Clinique, Clarins and Nivea are pumping out a catwalk of male-specific cleansers, moisturisers and after-shave products that have extended the options for retailers and customers.