An Empirical Analysis of Pricing in Luxury Fashion Brands

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<p>Characteristics of luxury fashion brands were quantitatively derived from regular and selling prices extracted from online retail stores specialized in luxury fashion products. This study assumes that brands definitively determine regular prices based on marketing; however, online retail stores dynamically adjust selling prices considering the balance between consumer demand and producer supply. Regular price distributions indicated the prestige of 34 luxury fashion brands, with traditional French and Italian brands appearing in a higher rank. Two emerging luxury brands also had a higher social status. This result suggests that the mobility of creative talents allows emerging brands to inherit the brand equity of traditional and prestigious brands. The analysis of variance (ANOVA) suggests that 34 luxury fashion brands were segregated in the market, even price distributions overlap each other. Two-way ANOVA for brand groups comprised of main and diffusion lines confirmed the difference between lines, and the difference between regular and selling prices. This paper classified these brand groups forming diffusion lines into five types, based on brand operations and the price relationship between main and diffusion lines.</p>

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