Why MK and Coach must raise prices?
Raising prices is a common strategy used to adapt to market changes, deal with rising costs, or increase brand value. In the case of the two brands MK (Michael Kors) and Coach, the price increase may be due to the following reasons:
Rising costs: Rising raw material, labor and operating costs may be one of the reasons for brand price hikes. If the cost of materials and manufacturing used by the brand increases, the brand may adjust the price of the product in order to maintain profitability.
Brand value enhancement: With the development of the brand and the improvement of market recognition, the brand value will also increase. Brands may raise prices to highlight their high-end, luxurious image and maintain a certain gap with other luxury brands.
Supply and demand: If market demand exceeds supply, brands can take the opportunity to raise prices to balance supply and demand. By raising product prices, brands can control sales volume while maintaining the scarcity and exclusivity of the product.
Market positioning adjustment: Brands may reposition themselves in the market by raising prices. The price increase can attract a higher-end target consumer group and differentiate it from other competitors.
It should be noted that the price increase is not without risk, as it may lead to a decrease in consumers’ desire to buy, or make the brand uncompetitive. Therefore, brands usually conduct sufficient market research and analysis before deciding to raise prices, weigh the pros and cons, and ensure that their decisions are in line with market demand.
In the end, the specific reasons why MK and Coach decide to raise prices may need to refer to their market strategy, brand positioning, and the comprehensive consideration of multiple factors such as the current market environment.
