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    The "Referendum" Of Luxury Goods Is Actually A Disguised Price Cut.

    2015/4/25 16:28:00 30

    "Referendum"Price CutsLuxury Goods

    Sales promotion by price reduction will play a better short-term effect, but it is uncertain that it will become a long-term market strategy. It may even shake the foundation of luxury business.

    In the absence of core resources, luxury electronics business has no confidence in price war.

    Chanel and other famous global price adjustment plans and business plan seem to have triggered the Domino effect, and more and more related industries and enterprises should make adjustments.

    And the domestic luxury electric providers that are more affected have the smell of smoke.

    The luxury service platform monastery held a special referendum price reduction program called "referendum", the first time to achieve the "user referendum" in the form of deciding the official website of the temple library to promote the luxury brand category.

    The so-called "referendum" is actually in disguised price cuts, the difference is that the sale of goods under normal circumstances is determined by the retail channel, while the temple Library's promotional activities are determined by the user.

    The temple library said it would set up a weekly voting activity and decide the brand and products to be promoted according to the voting results.

    The brand selected in the first event is LV, which covers LV's classic NEVERFULL series, SPEEDY series and ALMA series. The price reduction is also very impressive. Hundreds of LV bags and single products are directly down by 30%.

    The effect is certainly considerable.

    According to the introduction of the temple library, the first day of the LV promotion campaign of the vote brand made the temple library achieve 3 times the daily traffic volume, and some popular funds basically sold out in 1 hours.

    Temple library is considered to be a well-known brand of luxury electric business.

    It was founded in 2008 and completed the total financing of over $100 million in 2014 for the industry.

    And,

    pawnshop set up by a temple

    It has always been reluctant to position itself in the role of pure luxury electric business, but aimed at "high-end consumer service platform", that is, to open up the whole industry chain of luxury purchase, appraisal and evaluation, after-sale maintenance and second-hand circulation.

    Therefore, it is somewhat surprising that it launched a price war in such a high-profile manner.

    There are two problems involved.

    First,

    brand image

    It is the lifeline of luxury goods, and most of them do not want to see the emergence of price war, because this means that their brand value will suffer great damage, thus losing their competitive advantage relative to ordinary commodities.

    And,

    Luxury goods

    The reason why the development of electric business is not ideal is that part of the reason is that we can not get the full support of the luxury brands.

    In order to maintain scarcity, big brands have very strict control over sales channels, especially it is difficult to authorize low-priced and fast selling channels. This leads to the fact that luxury electric providers in China mostly use purchasing agents or foreign buyers to rush to buy, or cooperate with agents, but this is a big problem.

    Think about it, the big ones are willing to build their own network channels, that is, there is no guarantee that they will be supplied to the network platform.

    Second, the low price of luxury electric business as a selling point is not necessarily conducive to creating word of mouth.

    There are third party watchdog agencies claiming that the counterfeit rate of Chinese luxury goods suppliers is not low. Once they are labeled with cheap labels, it is easy to "lie down" when the counterfeit crisis breaks out.

    Moreover, in the increasingly high cost of physical stores and the heavy pressure of the Internet, luxury brands have already built their own electricity supplier channels, and there will be no advantage in terms of price distribution in front of direct customers.


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