Should Premium Brands Slash Prices for the Holidays?

Sunday’s New York Times has a full-page ad for Barney’s, saying prices are slashed 50% right now, before Black Friday. So that means you can probably buy a $700 pair of shoes for $350. Big deal. I don’t buy $700 shoes, and I don't need $350 shoes. And now I’m annoyed too, because the message is clear:

“our prices are so high we’re still making a buck when we sell at 50%.”

What should premium brands do this Christmas? Emphasize service above all, followed by quality and selection. I know I can get the same shoes cheaper other places, but I don’t mind paying more for shoes from Zappos because I know they have the best service on the Internet.

Lower prices would be great, but I’m going to buy from them anyway because I know and love them, and I know I can count on them. Barney’s? Just last week they were acting too snobby for the likes of me to go to their fancy store. Now, they can keep their 50% off sale!

Premium brands are cheapening their brand by offering massive discounts. Brands need to stay consistent. By going with cheaper products they are only focusing on the short term. When the economy bounces back, their brand will be cheapened.

It probably isn't comfortable and easy for them to offer up expensive products during a rough period, but it is necessary for their long term image.

Imagine if WalMart tried to sell premium products. It would be laughable. Now we are seeing premium companies imitate WalMart with cheaper products. It doesn't work.