How to Overcome Price Resistance for a New Luxury Startup

Transcript:

Hey, guys, I am Syama Meagher, CEO of Scaling Retail and this one today goes off to all of the luxury fashion startups. Now, this topic is really important. And this is all about how to price yourself to overcome price resistance for luxury startup brands. Now, it’s one thing to be a 200-year-old company that’s charging very high price points because you have a lot of heritage. But what can you do if you are a young startup and you’re interested in capturing a huge market share of the luxury segment? We’re also going to talk a little bit about copywriting and how you can be doing perfectly brand position statements and presenting your company in the best foot forward because, guys, after all, it’s not just going to be having a high price point product that’s going to set you in the luxury segment, it’s going to be being able to communicate that emotionally to your ideal customers so they feel like they’re having a luxury experience.

Now, before we launch into it, I just want to mention, that having a luxury brand oftentimes means having a luxury budget. It’s not often that you’re going to be able to start a luxury business by having little to no startup capital, and that you’re not going to be able to have to spend that kind of money or higher price points on higher production and better quality production. So, when you start to think about your budget going into having a luxury startup, it’s important to ask yourself, “Does my startup fashion company have the funds to be able to produce content, to produce a high-quality product, not just once, but over and over and over again?” Right? We’re still and a retail marketplace, which means you don’t just have one product. Your content needs to be reflective of a very high brand voice. It needs to be reflective of how you want someone to feel.

So, this means that your production, guys, need to be well-thought-out planned. Now similarly you might see every season Louis Vuitton comes out with a new ad campaign for the monogram bag. And what’s funny about this is, guys, it’s the same product, but yet they continue to tell that brand story over and over and over again. So, even if you are a luxury startup that’s focusing on perfecting one product or perfecting three specific kinds of products, it’s very important that you ask yourself, what are all the different iterations of campaigns and advertising that I need to be able to invest in an order to support that.

Now, in addition to that, you’re also going to be looking at building up social proof. Now, if you take a look at brands online like Sophie Buhai, or you take a look at Brother Vellies, what you’ll find is a very clearly crafted brand voice and brand positioning on their Instagram channels. You’re also going to find that the kind of press that they get, where their founders are hobnobbing and mixing and the lifestyles that they have are also very luxury. It is difficult to launch a luxury brand, again, without being able to invest those luxury dollars. Whether that’s in you as a founder having a certain type of lifestyle. And as we’ve talked about in other videos, you as a founder play a huge role in how the public perceives your business. If you are not living a luxury lifestyle, but yet you’re investing and producing this luxury product, there might be a little bit of a disconnect between who’s buying or who this is for and who the founders are. So, it’s important that you really take a step back and say, “What do I need in order to be able to make this a brand and a lifestyle that is really authentic and really believable?”

Now, of course, when it comes to actual implementation of these different processes, you want to make sure that you have built a cohesive branded platform to help showcase your brand voice. We talk about things like copywriting, making sure that all of the great benefits and features of your product are being highlighted. One of my favorite things to mention, guys, is never to use the word luxury. In fact, the moment you say, “I am a luxury brand,” right, it’s like saying, “Really? Like, are you really that cool? Like what is luxury?” Luxury is defined by emotions. Luxury is defined by feelings. Luxury is defined by a lifestyle. And you can certainly show and communicate that lifestyle without having to use luxury fashion in every other sentence that you have on your website.

So, please make sure that you understand for your particular segmentation, what does luxury mean to them, right? We still do have a lot of luxury fashion brands that are focused on a lot more flashy, you know, advertising. They have a lot of gold. It’s realty ostentatious. You also have a lot of luxury fashion brands that are focused on building more sustainable businesses, like Maiyet for example. So, understand that within that segmentation, there are different ways in which you can position yourself. So, you’re getting over price resistance. A lot of it is, are you exuding the feeling? Are you able to communicate that in all of your branding platforms? What does your content say about you? And then, do you deliver after the product has been purchased? How does the packaging arrive? Right? Are you going to really going to cultivate someone who is going to be buying at a second time? Or is it that they buy it the first time and you what, you didn’t deliver on the product or on the packaging and now they’re never going to buy from you again, or maybe they return it.

So, overcoming price resistance has a lot to do with number one, how you’re packaging it and delivering it, both in terms of copywriting as well as physical delivery. And then also, guys, in terms of the stake in the game that you have. Luxury brands tend to be on the show their worth and prove themselves not only through social proof, but through skin in the game over a longer period of time. Sometimes you’re looking at having a customer revisit your site three or four times before they actually convert because it’s a higher price point for an item. So, if you think about, that means every time they come to your site they’re expecting to see new content, new imagery. Once a month, you should at least have a homepage change or re-merchandise your product. You want to have consistent newness. Otherwise, that luxury purchaser isn’t going to come to your site once and buy, right, on the third or fourth time they might say, “Hey, that guy doesn’t have any newness on the site, I guess maybe they’re going on a business, or maybe there’s something happening within the company.” So, guys, please make sure that as you search to look to overcome price resistance from your competitors and from your consumers, what you really want to be able to do is focus on all the different ways in which you can hold their hand throughout that process.

Get more on this topic on our latest blog post called The New Vanguard, how new hot luxury brands are using storytelling in order to capture and convert their consumers. And definitely, make sure you check out our free download on five steps to analyzing your social media. This is an extremely valuable tool because, guys, if you wouldn’t follow yourself online, how can you imagine any of your customers would follow you online? And if you have a luxury brand, you’ll want to make sure that that brand values and those brand voices are really carried through through this platform. All right, guys, thanks so much for watching. Please make sure to leave a comment below. Subscribe to our YouTube channel and head on over to Instagram in order to see the new latest things that are happening on the Scaling Retail platform. When you are ready to take a leap into your business, starting it, scaling it, looking to take your business to new heights, shoot us an email, we are at hello@scalingretail.com. Talk to you soon, bye.

Ready to launch a luxury startup of your own? Learn how to justify your luxury prices with a compelling image in places like Instagram. Get your free download today: “5 Steps to Analyze Your Social Media”.