27 Pricing 6: Be the most expensive

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PRICING 6: BE THE MOST EXPENSIVE

It’s about prestige. You can’t just put your prices up without matching them with quality, and expect customers to pay. But by being expensive you are making a branding statement. It positions you right at the top of the luxury market. Not everyone wants to be there, but when you occupy that slot it’s something you can draw attention to.

The idea Breaking records attract publicity, including to prices. Each time a house breaks the top price barrier, it’s reported in the press. If you are at the top end of the market, you can use your price positioning to get people talking about you. Bear in mind that you’ll be criticised for encouraging extravagance (“fat cat”) once you attract media attention for being expensive, but if that’s where you want your brand to be, then go ahead.

As customers, we tend to believe that if something is exceptionally expensive, it must be exceptionally good. This is a very cynical view of pricing policy, but there is a ring of truth about it.

For high prices to be sustainable, you really do have to keep your quality top notch. You can only fool somebody once, and that really isn’t a good business strategy, but if your brand does offer exceptional quality, then there’s no need to be afraid of setting a high price for it. For decades, Joy perfume by Jean Patou was known

as the world’s most expensive. Now the slot’s been taken by Clive Christian’s Imperial Majesty, but the price ($215,000) is mostly for the diamond studded bottle.

In practice • If you have an expensive brand and you can justify the price in quality terms, tell the press all about it and get yourself talked about. • Make sure that all your staff, especially your sales people, feel comfortable with the pricing and are proud of what you’re offering. • Be courageous. Explain why it’s expensive and give your potential customers the reasons they should buy it.