Why the business of hair is recession-proof — and what it says about how women spend
Taylor Swift at the Billboard Music Awards
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Ask a woman about a bad hair day and she likely won’t describe a cosmetic problem. She’ll describe a confidence problem. Research consistently shows that hair is one of the most psychologically significant aspects of a woman’s appearance, tied not just to how she looks but to how she leads, how she presents herself in a boardroom and how she moves through the world. For professional women especially, hair is rarely just personal. It’s strategic.
That emotional weight is exactly what makes the business of hair so durable. The most successful companies in this space aren’t simply selling color or products. They are participating in something far more fundamental, giving women the tools to feel like themselves on their own terms and on their own budget. And in an economy where salon prices have risen sharply and consumer wallets are stretched, the DIY beauty movement has shifted from a workaround to a way of life.
Denise Paulonis has a theory about the business of hair. “We might not have big highs, but we never have big lows,” the CEO of Sally Beauty Holdings told me. “Women are so loyal to their hair routines that they will scrimp and save on other things before they give up getting their hair colored. Once you start coloring your hair, you don’t stop.”
Denise Paulonis, CEO of Sally Beauty Holdings, Inc.
Sally Beauty Holdings, Inc.
That observation sits at the center of a larger economic story, one that pandemic-era necessity helped write and that ongoing consumer budget pressure is now amplifying. When salons shut down in 2020, millions of Americans colored their hair at home for the first time. Most never fully went back. Sally Beauty’s own proprietary research finds that only 18% of people who color their hair do so exclusively at a salon. Forty-one percent do it entirely at home and another 41% split between home and salon.
For Sally Beauty (a $3.7 billion company operating more than 4,400 stores globally), that behavioral shift has created a real tailwind. Paulonis draws an analogy to the “lipstick index,” the economic phenomenon where consumers trade down from luxury goods to affordable indulgences in tough times. You may not be buying Chanel clothes, she noted, but you’re buying Chanel lipstick. And you’re definitely touching up your roots.
Hair color is structurally different from most consumer categories. It doesn’t just attract customers. It locks them in. Roots grow, color fades and the clock resets every three to six weeks. That reliability makes hair Sally Beauty’s anchor, and Paulonis has built her transformation strategy around it. Since taking over as CEO in 2021, she has launched a brand refresh she calls “Sally Ignited,” overhauling store formats with nail rotundas, discovery bars and styling demo stations designed to encourage browsing and cross-category buying.
Sally Beauty Holdings, Inc.
One of the more novel moves is a “Licensed Colorist on Demand” program, through which consumers can video, audio or text chat with a real licensed professional (not an AI bot) directly from Sally’s website. The service conducts roughly 5,000 consultations per week. Customers who use it end up with baskets about 25% larger than those who don’t. “Customers told us they don’t trust YouTube to tell them how to color their hair,” Paulonis said. “They want a pro to walk them through it.” The feedback has been overwhelmingly positive, with 93% of users rating it positively.
The program also speaks to something deeper. In an era of AI-powered everything, beauty (and hair color in particular) remains an emotionally charged category where consumers still want a human conversation. Few people want an algorithm to tell them how to fix a bad dye job.
Paulonis is now extending the DIY thesis into adjacent categories. Nails are a major focus, particularly targeting younger consumers who want salon-quality gel and dip manicures at home for a fraction of what they’d pay in a salon. A gel manicure light kit runs about $20 at Sally Beauty, versus $30 to $70 for a single gel manicure in a salon. New store formats put nail products prominently at the front, and Taylor Swift (who drove a viral run on hair tinsel during her Eras Tour) has proved the category’s viral potential. “That same DIY enthusiasm that you get from the young customer who wants vivid hair, you get in nails too,” Paulonis said.
Sally Beauty Holdings, Inc.
Fragrance is the other big bet. “Dupe” fragrances, which are mass-market alternatives to prestige perfumes at a fraction of the cost, are exploding in popularity, particularly among younger consumers who want a rotation of scents rather than one signature fragrance. Sally is expanding its fragrance offering to 2,000 US stores in 2026, after strong consumer acceptance in its initial rollout.
Sally Beauty isn’t alone in spotting the opportunity. Madison Reed, the hair color brand founded by Amy Errett in 2013, has built a business on a similar premise, that there should be choices between a $300 salon appointment and a $10 drugstore box. The company has raised approximately $250 million in venture capital, reformulated at-home color to remove ammonia and other harsh chemicals and developed AI-powered shade-matching tools to close the gap between consumer and pro. “Just because you color at home does not mean you can’t afford good color,” Errett has said. That the message resonates across brands and price points only underscores how durable the underlying shift is. The DIY beauty consumer offers a huge opportunity.
The shifts playing out at the retail level are registering in beauty education as well. Dana Persico, CEO of Long Island Nail, Skin & Hair Institute, which graduated over 500 students last year from a single campus, has watched consumer DIY habits reshape what professionals need to know. She says the economy is prompting consumers to find a rhythm between salon visits and at-home maintenance. “If women can find the in-between, so that they’re not going every four weeks when we feel things at the gas pump and the grocery store,” she said, “they look to find a way.”
Persico has also seen a meaningful shift in which programs students are choosing. Enrollment in traditional cosmetology programs, focused primarily on hair, is down nationally over the past two years, while esthetics, nail technology and laser programs are growing. At her school, nail classes are currently at capacity with a waiting list. The message from the market is unmistakable. Consumers want more ways to maintain their appearance between professional visits, and the industry is training a new generation to serve them.
Long Island Nail, Skin & Hair Institute
Social media has accelerated all of this. On Instagram, Persico observes, consumers see the finished look, aspirational and polished. On TikTok, they see the process, how to get there yourself and how to do it affordably. Creators like Nina Pool (known on TikTok as @ninaghoulina, where she has 6.2 million followers) have built large followings by breaking down the chemistry of beauty products, identifying high-quality drugstore alternatives to expensive prestige brands and making professional-grade knowledge accessible to anyone with a phone. “Her goal is not to hurt large brands,” Persico said. “Her goal is to help women save money and get the same result.”
@ninaghoulina on TikTok
TikTok
For companies like Sally Beauty, this is both a challenge and an opportunity. The informed DIY consumer is a more demanding one, but also a more engaged one, someone who will spend time researching, comparing and coming into a store with a phone full of notes. Paulonis has leaned into that dynamic. Sally’s DoorDash and Instacart partnerships, along with its e-commerce business, serve the just-in-time beauty shopper who needs a root touch-up spray or a set of gel nail supplies before company arrives. More than half of the customers coming through those delivery channels, a company study found, are new to the Sally brand entirely.
What Sally Beauty’s trajectory illustrates is the power of understanding a consumer’s relationship with a category, not just the product. Hair color isn’t something people buy. It’s something they do, on a schedule, over and over for decades. The same is increasingly true of nails and fragrance as DIY culture normalizes across beauty.
The real story here isn’t about any one retailer. It’s about millions of women who, after years of inflation, tariff anxiety and economic whiplash, have quietly decided what they won’t give up. Businesses that understand that kind of loyalty don't just survive an economic downturn. They're built for it.
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