As the cost of living crisis continues, many have had to reconsider how and where they spend. And yet, an unexpected trend is gaining momentum: the rise of luxury designer cafés. Complete with branded lattes, curated interiors, and perfectly plated pastries, these cafés are doing more than serving caffeine, they’re tapping into the “lipstick effect” and the ever-popular “little treat culture,” offering accessible indulgence in an otherwise uncertain time.
The lipstick effect, first studied by economics and sociology professor, Juliet Schor, in her 1998 book The Overspent American, was later popularised by Estée Lauder’s chairman Leonard Lauder in 2001. According to the theory, the sale of affordable luxuries increases in times of economic downturn as people are more likely to spend money on small luxuries like lipsticks rather than designer handbags to make themselves feel good in otherwise uncertain times. Think of that “I deserve a little treat” situation, because we all do!
Today, that mindset has extended beyond beauty. In a post-pandemic world, layered with global conflict, political uncertainty, and economic pressure, people are seeking comfort wherever they can find it. Increasingly, that comfort is coming in the form of food and drink, specifically, aesthetically pleasing café experiences designed to feel both indulgent and shareable.
Ralph Lauren, Louis Vuitton, Prada, Dior, and Tiffany & Co. are just a few examples of designers who have opened up cafes and pop-ups around the world to offer consumers a taste of their opulent lifestyles. Drawing on the viral appeal of ‘little treat culture’, these cafes offer affordable indulgences in the shape of coffee and cake. By offering a more affordable way for people to experience their brands, designers are democratising access to their prestige status, allowing a wider range of people to develop meaningful connections.
Located within Tiffany’s flagship store in New York City, the Blue Box Café, is a great example of a brand selling a unique experience. Referencing Audrey Hepburn’s ionic role as Holly Golightly in the cult favourite Breakfasty at Tiffany’s, the cafe’s menu offers guests the choice between a complete “Breakfast at Tiffany’s” selection or “Holly’s Favourites", which they describe as a “luxuriously chic moment to start the day”. Through their tailored menu, Tiffany is giving their customers the chance to immerse themselves within their world and recreate one of the most iconic scenes in 20th century American cinema. In doing so, Tiffany increases its attainability and allows people to form emotional connections with the brand in ways they may not have been able to afford otherwise.
The social media effect of the cafe experience is also undeniably important to its success. Designed with visual storytelling in mind, they’re made to be photographed and shared. In a culture where Instagram and TikTok shape trends, a beautifully branded coffee or a pastel-toned interior becomes powerful, organic marketing. For both creators and everyday visitors, these cafés offer content that feels both aspirational and accessible.
Ultimately, the rise of designer cafés signals more than just a shift in spending, it reflects how luxury brands are adapting to a changing world. By leaning into the lipstick effect and the momentum of little treat culture, they’re finding new ways to remain relevant, relatable, and shareable - one cappuccino at a time. (or one ballerina cappuccina at a time :D).
