Obviously, the recession is on everybody’s minds, and obviously, most talk here at the Fashionista offices usually turn to shoes. So here’s a thought we had this afternoon:
If one good thing comes out of this economic crisis, it could be the deafening pop of the what we’re calling the Shoe Price Bubble. Picture it:
Constant sales lead to constantly lowering prices. Constantly lowering prices could lead to stores beginning with more reasonable prices rather than suffering through crawling profits and an embarrassing stream of sales. Price adjustments could lead to stores pricing strategically, in order to get the most customers, which could ultimately lead to the general price of what we all know are stratospherically over-priced goods plummeting back down to a normal range of say, $400 for designer shoes, rather than $1,000+.
Because as it is right now, we’re living in a world where hundreds of extra dollars can be slapped onto something as some kind of name-association fee. But if brands want to survive, it’s getting to a point where everybody has to throw their hands up and just admit they’re marking things (and by “things,” we’re specifically pointing towards shoes, bags and denim) up because they can, and because nothing’s stopped then.
Until now. Do you think prices could start much lower for this Spring’s wares? Or could store’s conservative ordering keep the supply - and prices - as high as they’ve been?
posted by guest
Nov 24, 2008 12:54PM
As much as I love a bargain, in the long run, reducing list prices is not the best option for retailers and luxury good firms. Luxury brands cannot afford to reduce their list prices as it will destroy brand equity. Retailers will face smaller, if any, margins. Also, it is doubtful that prices will be much lower this spring, particularly on European goods, as suggested retail prices were set when the US dollar was weaker against the Euro.