Eleven Golden Week, his wife went to overseas shopping, vulgar writers, although the heart itch, but only in the circle of friends brush to pretend to the 'far field', but this year the country is not easy to travel. No, many relatives and friends entrusted his wife to help Daixiang big bags and brand-name cosmetics.No reason it, who let these luxury brands in China selling more expensive!
Why do luxurys sell more expensive in China?
Deloitte Touche Tohmatsu released in 2016 on the global luxury goods prices analysis and analysis shows that China is the world's highest luxury goods in the country, 23% of luxury brands in China's domestic price of 16% -25% than abroad.
In addition to high-end luxury goods in the domestic and foreign markets there is a huge spread, the light luxury brand is showing a surprising price difference, such as Coach in China and the United States has been as high as 40% spread.
The theory of economics tells us that in a market, homogeneity (here not only refers to the physical sense of homogeneity, more implicit consumer subjective cognitive differences) goods can only be sold at the same price.
The reason is simple
If the seller can sell at two different prices, the consumer who has just bought the goods at a low price will resell the goods to another customer at a price between his own purchase price and the seller's high selling price , So that the seller set the high price that can not reach a real deal.
Such a simple economic theory, of course, it has the prerequisite for the establishment of the most important one is that consumers can transfer the goods or services to each other at this time, for manufacturers, even if faced with different willingness to pay consumers, he can only Using a single pricing model.
However, once an enterprise discovers a means of separating a different type of consumer, it is motivated to use a differentiated pricing strategy for different consumers who are willing to pay for profit for the purpose of profit.
In this book market as an example, a writer's books have a large number of loyal fans, which can be produced hardcover book, sold to loyal fans at high prices, and so after the digestion of these people, and then rollback book, sold to the general readers. In this process, not only the price difference caused by differences in production costs, there are different people are willing to pay the price difference.
Economists give this distinction between the pricing model to take an academic name, called 'three price discrimination' .Managers prefer to call the difference pricing, popular argument is differentiated.
It is understood that the geographical distance between China and Europe and the United States, as well as the various barriers to population movements, in fact for the sales market in China, Europe and the United States multinational companies, provides a natural barrier, so that the two sales market segmentation It is difficult for the purchaser to transfer the consumer goods between the two markets, so that the firm can naturally take different pricing strategies in different markets and for different buyers.
Who is pushing up luxury pricing?
Readers may have the doubts: in terms of average income, 2016 our country's per capita GDP is only ranked 72th in the world, far below the living standards of Western countries, these high-end luxury brands in the Chinese market pricing should be lower Why is reality really the opposite?
High-end consumer brands because of its brand awareness, reputation, similar substitutes less, in the market with a certain monopoly power, according to the economic language, is the demand for price elasticity is relatively low.Enterprises in order to maintain brand high-end, to a certain extent, Power to increase production, and even deliberately lower supply, through the 'hungry marketing' model so that buyers not only get the consumption of the product itself to bring happiness, there is a certain identity conspicuous function, so that buyers experience their own but others Did not bring a sense of satisfaction.
For the time being, China's per capita income is not very high, but China's population base is large and the income distribution is uneven. On January 20, 2017, China's National Bureau of Statistics released the latest income Gini coefficient - 0.465, indicating that the domestic income gap Larger.
According to the Gini coefficient, China and Brazil, Mexico and other countries in an echelon.Although the proportion of wealthy class is not very high, but the total is not small, this part of the crowd on the high-end consumer brands formed a great demand, and very It is difficult to find other similar substitutes, resulting in its willing to pay premium for high-end consumer brands.
In this context, the brand enterprises in the face of the Chinese market more steep demand curve, so the pricing will take the high-end pricing routes, and even some low-end brand in Europe and America manufacturers in China has also been created a high-end brand impression The
For example, Starbucks, which caused the discussion of all the people in 2013, was priced by the characteristics of the Chinese consumer market. Who made you feel that drinking Starbucks coffee was better than drinking coffee, and that other drinks were more petty bourgeoisie, A large number of consumers willing to pay a higher price for the Starbucks brand, the pursuit of profit Starbucks company will naturally be based on the domestic market reaction, set a relatively high price.
Electricity business overseas purchase service is producing a positive effect
It is emphasized that it is difficult for the purchaser to take a different pricing strategy for different consumer groups when the purchaser is difficult to transfer between the two markets, and to set a higher price for consumers who are willing to pay higher. The division of the division is broken, companies want to distinguish pricing in the two markets will no longer work, because if consumers can arbitrage between the two markets, after obtaining low-priced goods resale to other consumers, then the enterprise Of the price discrimination strategy can not be successful, and ultimately still return to a single pricing model.
In other words, smart consumers and entrepreneurs will naturally discover and exploit this spatial imbalance to achieve trans-regional arbitrage when there is a significant difference in market prices between the two countries.
In recent years, one side is the rise of tourism shopping abroad, one side is the major business platform, such as Lynx, Suning, Amazon, the only goods will have launched overseas purchase services.With these overseas purchase platform mature, domestic consumers Brand consumption increasingly rational, the two markets will tend to a new balance, and to a certain extent, narrow the price gap between the two countries luxury goods.
