Priced to Inspire How Premium Pricing Defines Luxury

Pricing: A brand Statement

In today's market, numerous ways have been developed to establish the price of goods and services, and many have tried to argue which one is the best. Psychological pricing, freemium pricing, competition-based pricing, and so on are all excellent ways we could use for our specific brand; nevertheless, the most important thing we as Marketers must remember is which aligns with our unique value proposition and brand positioning.

As a marketing professional with passion for lifestyle and luxury brands, this companies are a perfect example of how choosing the right price strategy can help us tremendously, because remember: pricing is more than just a number, it’s our brand statement. 

In this very interesting sector, premium pricing is common as this focuses on positioning a product or service as high-end, something that applies perfectly with companies who want to communicate exclusivity, craftsmanship and a promise of excellence. When Hermes chooses a premium pricing, they are telling their customers: This is not for everyone- it is for those who demand the best.

Do you think the price of your product or service reflects the intrinsic value and inspiration your brand tries to communicate?

• Yes
• No

Crafting the perception of value

After many years of working and studying renowned brands strategies across different markets, I have learned that Luxury and Lifestyle brands offer us a fantastic view of how they focus on conveying the value, quality, and exclusivity of their products rather than negotiating on price, this is something we can learn for our  advantage when negotiating.

As another example, Lululemon is a known lifestyle brand that positions itself as more than just another apparel company. 

In reality, they sell their customers the possibility of being part of a group of people who give a lot of attention to living a healthy, well-balanced life focused on performance.  If the brand didn't share it's emphasis on using quality materials and innovative fashionable and high end designs, the high price would be completely unjustified.

“Pricing is not just a number—it’s the reflection of your brand’s value, story, and the experience you offer.”

Adapting  premium Price Without Compromising  brand Prestige

Now, you may be asking yourself what happens if you need to make changes on the price of your product or service to remain competitive, boost sales that are either slacking or slowing down? more importantly, how do you do this without compromising your brand value? One area you have worked so hard in building.

After many years of marketing experience, I can share with you the answer to your question. Remember when I said all types of price strategies are useful if they are adequate? In this scenario,  techniques like skimming pricing can allow you to introduce products at a high price point and gradually lower them as the product matures or becomes less novel; this is something almost all important companies like Audi or Apple do.  

Finally, you can use geographic pricing to adjust prices based on specific regional market conditions, charging more in affluent areas while adapting to local economies or emerging markets; while I was working at Mead Johnson, we used this for "Enfagrow," a premium baby formula brand in Peru, by keeping a premium price but still at a discount when compared to what it usually sells for in other markets like Mexico or the USA.

Final thoughts

Premium pricing is an attractive strategy, but remember, it goes beyond a simple high ticket number, it's a promise on quality and exclusivity and an unforgettable story that inspires people to be part of what you represent, and if done properly, you will see an increase in profits and customer loyalty. 

Just keep in mind, if you can't deliver quality and product exclusivity, your customer will quickly let you know maybe this is not the right price strategy for your brand.