Women like to feel pretty. So despite the ailing economy, they are still buying beauty products but on a budget—providing a great opportunity for entrepreneurs that supply discount stores with skin and hair products.

According to a recent survey of 1,000 U.S. women by Mintel, the Chicago-based market research firm, 40 percent of women are waiting longer between purchases. The study also revealed that one out of every three women is switching to cheaper products. Mintel senior beauty analyst Taya Tomasello calls this trend "econochic," when consumers struggle to balance hard times with their cosmetic concerns.

"Women are focused on getting the most out of their beauty dollars," she adds.

Consumers aren't slashing their budgets wholesale—for every individual, there's at least one product they refuse to give up, Tomasello says. But they are experimenting with new, less costly alternatives sold in discount and drugstores.

That's good news for CEO Ido Leffler, who has witnessed firsthand consumers' growing interest in drugstore brands. His company, Yes to Carrots, sells its line of beauty products in stores such as Target, Rite Aid Pharmacy and Walgreens at wallet-friendly prices. Despite the global slump, he forecasts a 30 percent increase in sales this year.

Leffler attributes their growth to the way they've positioned their products—high-quality at low prices.

"Our philosophy has always been guilt-free beauty," he says. "We didn't want consumers to see their credit card bills and feel guilty—that defeats the purpose of buying beauty products."