JEANS PRICE DISCUSSION

PRICE & BRAND DISCUSSION

Regular consumers cannot figure out or really understand why there is such a big price different for "similar" fashion denim products in the retail shops. We all have seen jeans as low as 5 Euros and as high as 180 Euros. Why is that ?

The answer to this issue is related to many variables that consumers niches will accept or not. We will present in this scenario a basic 3 brand analysis so we can better understand why one consumer buys what.
This basic analysis is not a fashion jeans bible but the purpose is just to understand a little better consumer behaviour. We must also consider that these are random examples and more consumer variables could be a priority for customers in different countries, and different cultures. Also note that brands may have other products that can deny the following analysis. The purpose of this analysis is just to give the reader a basic general idea of consumer behaviour and brand awareness.

Primark is a well known international company that sells garments. We can see in their shops
a broad range of jeans. Please see http://www.primark.ie/penneys_products/womenswear/products/
http://www.primarkeando.com/2012/09/primark-hombre-otono-invierno-2012-2013.html



Please look at this ad from Primark selling a basic "unwashed" jeans for 10 pounds (aprox. 11 Euros). We cannot check physically the garment as this is a simple pic but we can notice the following:

0. Price is very attractive
1. The garment is barely washed, meaning that has little washing process.
2. The fabric seems to have some slub.
3. Simple accesories included.
4. We do not know the weight but since it is winter collection, could be a fabric of around 9 to 10 oz.
5. The overall look is acceptable and relatively classy.
6. Stiching quality and pattern of the garment we also asume is acceptable for correct fitting.
7. Pocket design is small.

Now, we will try to find a "similar" garment from another brand like Massimo Duty.
.

The price of this garment is 39,95 Euros, please see http://www.massimodutti.com/webapp/wcs/stores/servlet/category/dutties/en/massimodutti/368010/Denim

We can see from the pics, the following:

1. Stiching quality, pattern and threads seem of good quality and color.
2. Dark fabric with little washing. Hand Feeling seems soft. 100% cotton.
3.Little slub on fabric or none.
4.Accesories seem standard.
5.We do not know either weight of garment but could be around 9 to 11 oz aprox.
6.Overall look acceptable and classy.
7. Price is moderately high.
8. Pocket design seems bigger in size.


Now, let´s check a similar basic garment from top brand named Diesel

Please see the following basic garment similar to those above from the web page
http://store.diesel.com/gb/carrot_cod42280561an.html:



This nice garment sells for 95 Euros.we notice the following:

1. Garment washing is limited also, maybe just a litlle of desized washed only.
2. Fabric quality seems also good and weight can also be around 9 to 11 oz 100% cotton.
3. Stiching and thread colors, seem of good quality also.
4. Pockets similar but lower location.
5.Overall look very nice and very classy.
6.Seems no slub on fabric and accesories are standard.
7. Price is high. We must notice that there are even more expensive "similar items".


From the above examples, we realize that few technical differences can be present among these three brands. For some consumers these differences are neglilible while for others can be extremealy relevant.
Then, why a consumer chooses one from another and what customer niche buys one brand or another?

When you visit a Primark store you notice that many garments can be placed on top each other and folded. The shops do offer many other type of products, not jeans only. Therefore, the company overhead for jeans exposure is well spread among many other products.Also it is important to mention that probably the order quantities from this company may be much much bigger than others, therefore, they can get a chaper product price from manufacturers. The percentage of consumers that can buy cheaper products is obviously bigger. Therefore, this product is based sales volume for a big market consumer niche. Brand name or awareness does not play an important role on consumer decissions. In many instances, I have seen garments with no labels or very even very small. A consumer from Primark seems that looks for the lowest priced jeans and Primark supplies that need with a garment around 11 Euros.

The second brand analyzed is Massimo Duty with a product of almost 40 Euros. What does a consumer choose a 4 times more expensive product? We notice that there are some technical differences in the product itself. Are these differences enough for a consumer to pay that much or there is something else?
I have visited many times shops of this brand and the shop inside enviroment is really nice and classy. Not overloaded with many garments everywhere but with few styles of each on very specific areas. The shops do even smelt good and the workers do have a dress code. The moment I get into this shop I feel like there is  quality and fashion.The shops gives a sense of belonging to a  medium high .class. The product turnover is high compared to other brands as collections are not as big quantities. Many times I visited one shop and garments are gone already and new models just came up in few days difference.Staff attention in this brand is
quite good as well as a fitter is always around you folding garments.

My conclusion is that Massimo Duty consumers look for a combination of things when they accept to pay the price of a garment:
1. Constant new styles come and go much faster so consumer can see new things.
2. Nice quality garments.
3. Price is targeted for a medium and high class income consumer.
4. Shops are not saturated and you can get more attention from the staff.

The price of the garment is considered to be more expensive as collections tend to be lower in quantity and opportunity for consumer will not last in the shops. The company will pay more for the jeans compared to Primark therefore selling price will be higher also. The brand sells other textile products so overhead on the jean can be minimized as well.

Diesel brand and garment analyzed in this forum suggests that consumer buys the product due to brand name awareness. The quality of a garment for this brand is a given fact by the consumer. But why pay 95 Euros for a "similar" jean to other brands? I believe that the famous statement "irrational exhuberance" can apply to consumers decission to buy the brand. Brand awareness is not a tangible thing but certainly for some consumers is a point to wear a Diesel garment. What type of consumers will wear this brand?
In general, one may think that high income people but I have seen medium and low income that wears this product. The price is high because of different variables but since quality control is a given when a consumer decides that, overhead retailer costs must be bigger also. Note that this brand is mainly specialized in jeans and their shops are full of them. Therefore, brand´s overhead costs on fashion jeans are very big compared to other brands.Orders quantities for collections and styles can be short in quantities therefore buying prices of the garments must be bigger than other brands.

My conclusion on consumer´s behaviour for buying jeans is the following:

There is a market for everything and one can make money with it.