Susie Rushton: Lipstick economics have failed Space NK

Urban Notebook: The fiftysomething browsers eventually thank the pony-tailed sales assistant, and leave without buying

It's lunchtime and two well-preserved Kensington women in their fifties are picking up tubes of lipstick from a display of Laura Mercier make-up at the back of the shop. Scanning the neat white shelves of exfoliating creams and lip balms, I pick up a bottle of Bumble & Bumble shampoo and squint at the price. I put it down. Sod it, I think, and pick up again. The other women are being less reckless. "That's just too expensive," says the blonde to her friend. After a few minutes they drift towards the exit, stopping at the By Terry counter, where more browsing takes place.

Laura Mercier and Terry de Gunzberg (from whom By Terry takes its name) are typical of the big-name make-up artists whose goods sell at Space NK; at the peak of their careers as fashion professionals, they turned their reputations into cult brands. Their eyeliners, cheek glosses and powder compacts are expensive, high-quality, and not widely stocked. Boots or Superdrug sell products that do the same job, more or less, selling for about one-fifth of the price – without the same cachet, luxurious ingredients, or pretty packaging. But women are cutting back on frills. The fiftysomething browsers eventually smile at the pony-tailed sales assistant, thank her for showing them the goods, and leave without buying.

Space NK, which embarked on a huge US expansion three years ago, has stumbled in the slump. Accounts filed at Companies House this week predicted that 2010 would be "another very challenging year". Last year it posted a loss of £1.4m. So-called lipstick economics – which suggests customers treat themselves to small luxuries when they can't afford to move house, or pay for a second holiday – is not taking effect here.

I'm crossing all my fingers for Space NK. Since it opened in 1993, Nicky Kinnaird's (above) unique "apothecary" concept has catered to women (and plenty of men) who want to buy interesting, useful cosmetics and skincare which aren't just an afterthought to a celebrity-fronted ad campaign. Department-store beauty halls represent to me a death-by-sales-pitch. By contrast Space NK is small-scale, decorated in an appealing, ascetic style, and served by slightly brusque-but-efficient assistants. It needs to introduce more affordably priced products. Now is not a moment for £80 serums. But the face of the British high street would undoubtedly be less attractive without it

Not just a pretty face

My friend Natascha has turned into Molly Ringwald. Annabel is now Nicole Kidman. This week I made friends with lots of American actresses on Facebook, which has been invaded by "Face Double", a program that replaces your face with a celebrity doppelganger. In this curious application, your profile photograph is matched with a selection of famous faces, from which you are invited to choose one. She then becomes your new profile picture. I am now Brittany Murphy, who not only has a strange pointy chin, and was in the appalling 8 Mile, but is dead. I think I preferred being me.