Question

Explain the relationship between pricing tools and theories of consumer behaviors; on luxury items in the fashion industry.

Answer 1

Pricing tool and consumers behavior theory Igives an idea that how consumer select, purchase and use product and service to satisfy their needs and desires.

An effective pricing tool in the fashion industry is one that can be justified based on the quality of goods , location and competition ,luxury of that product and budget of consumers etc.

For example

Budget Pricing Strategy

Many consumers seek low prices when shopping for apparel,, with focussing on quality as well as durability and cost of goods. Serving this segment can yield significant sales volume at the expense of lower per-unit profitability.

Luxury Pricing Strategy:

this is associated with luxury of products and consumers social expression and image etc without consider the durability, for example apprale industry. This tool focuses on marketing and brand positioning as a main driver of price structure.

Value Pricing Strategy

It lies between the budget and luxury segments. The key to value pricing is to strike a balance between cost and quality, durability of products.

Price Promotions as a Sales Tool: offer and discount providing and promotion of these in events, school , holiday sales etc. Thus this isba good tool to attract consumers and check their behavior.