Muji’s pricing problem: Viral fame, sluggish sales

What happened Muji’s fall collection — including a herringbone jacket priced at 398 RMB ($56) and matching work pants at 248 RMB ($35) — has gone viral in China for evoking the utilitarian workwear of the country’s 1960s state-run “supply and marketing co-op” stores. These stores operated throughout China’s planned economy era. Clerks in dark blue uniforms stood behind high counters, where fabric required ration coupons and grain the same. In an age of scarcity, clothing prioritized durability over design. Loose, boxy cuts and oversized pockets became standard. Function defined aesthetics. The minimalist Japanese retailer’s new collection is a near-faithful revival. Oversized, unadorned pockets mirror the workwear of that era; deep greens and navy tones recall the utilitarian color palette; straight, loose silhouettes inherit the labor-ready cut. Paired with khaki platform shoes for 91 RMB ($13), the look distills collective memory into something tangible, wearable, and instantly recognizable. The Jing Take Muji’s physical stores have become a kind of retro photo hotspot for young shoppers. They flock to try on the “supply and marketing co-op” outfits as props for social media, snapping pictures to generate likes, only to return the garments to the rack afterward. Behind this lively spectacle lies a more awkward reality: while the buzz has exploded online, actual sales remain low, creating a striking mismatch between traffic and conversion. Price is the main barrier. On social media, consumers said that a jacket at $56 is not affordable for a nostalgic novelty. As one Xiaohongshu user, Maotougu (@猫头股), described it, the initial shopping impulse fades when friends become “price police” — she was talked out of buying. Competitive squeeze For years, the label’s Japanese minimalist aesthetic and reputation for quality gave Muji a commanding position in China’s retail market. Since 2020, local competitors have steadily eroded this advantage. Brands like Miniso and NetEase Yanxuan offer comparable designs at lower prices, diluting Muji’s market differentiation. Its quality premium no longer justifies the price gap, leaving the brand with a positioning problem: too expensive for mass market appeal, too ordinary for luxury status. It neither conveys luxury’s status signaling, nor competes on value with local brands. The “supply co-op” collection exemplifies this dilemma. It reveals contemporary Chinese consumer behavior: consumers embrace the cultural reference, but reject paying premium prices for novelty without tangible value. The brand evokes collective nostalgia, yet its pricing strategy is misaligned with the collection’s inherent practicality, turning the campaign into a traffic show without conversions. This core tension is clear: design captivates, pricing repels. When young shoppers treat stores as content backdrops but avoid purchasing, they signal that the brand must offer compelling value beyond being photogenic. For Muji, the real challenge is not creating viral moments, but converting fleeting attention into lasting loyalty. This requires recalibrating its pricing strategy to match perceived value — transforming social media engagement into actual sales.

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Muji’s pricing problem: Viral fame, sluggish sales