Objective:

1. Develop a relation between price increases & sell through. 2. How would sell through be affected when prices are increased for a lifestyle brand? 3. How much price increase will deter customer to move out of from brand loyalty?

Process flow:
Analysis of Pricing Strategy

Analysis of past sell through

Determining factors affecting the sell through

Establishing relationship between sell through and pricing

Market and customer survey

Interpretation of data

conclusion

Methodology:
1. Analyses of pricing strategy Type of pricing model followed by the brand (premium, penetration, economy, skimming etc) Target customer Pricing objectives - for example, profit maximization, revenue maximization, or price stabilization (status quo). 2. Analyses of past sell through of the brand (for past 1 year, or 6 months) Reason of sell through (more or less) Area of improvement to increase the overall sell through Sell Thru % = Units Sold / (Units on-Hand + Units Sold) A higher value is better indicating your sales velocity is good and your inventory is appropriately forecasted. If sell thru is low this indicates either poor sales or too much inventory. While calculating or comparing sale through following points should be kept in mind: Comparison should be done for same no of days Comparison should be done for the products which are sold into the similar store types 3. How the following factors affect the sell through of a product Cost Demand Competition - customers shop around and compare prices Economic trend Level of market demand Demographics Class of targeted customers 4. How these factors are related with pricing, and when pricing is increased what is its impact on these factors and vice-versa 5. Market/ customer survey to know about the effect of increase in prices 6. Interpretation of data, using statistical process control tools Comparing the sell through before and after the prices are increased Finding the reasons, that make customer to buy products Finding the reason that make customers loyal to a particular brand

Sample questionnaire:
1. Rate the factors that you see while purchasing the garment: Brand name Quality Price Discount or sale Comfort/ size/ fitting

2. What make you to purchase these brands 3. If the price of products is increased, will you still purchase this brand? Why or why not? ......................................................................................................................................... ............ 4. If you are getting the same product, with difference in prices You will go for the brand you always buy, in-spite of its rate is high You will switch to that brand which provides you less pricing Other, please specify ............................................................................................................................. ............................................................................................................................. ...................... 5. How much price difference from other brands you will accept for this brand <=250 250-500 500-750 More than 750