On April 21, the UK luxury fashion company, Mulberry, announced the launch of a global pricing alignment strategy to ensure customers — no matter where they shop in the world — will pay the same price. The new policy will roll out for only the brand’s leather goods category, which accounts for approximately 90% of Mulberry’s revenue, with its remaining product lines to follow. Global pricing will be achieved by matching international prices with the brand’s UK prices, though each region’s pricing will be inclusive of any local sales taxes or duties.
This is not the first time Mulberry has flirted with global pricing. According to Thierry Andretta, Mulberry’s CEO, results from two previous trials (one with Acne Studios last year, another with the M Collection earlier this year) were positive, which encouraged the company to officially roll out the program now.
This is definitely a smart strategy for brands to survive the ongoing COVID-19 crisis. As more and more consumers shop online, global pricing will boost brand transparency that’s much needed in this new digital norm. This will also help give the brand a leg up in the recovering China market. As the global price gap being one of the biggest motivations for Chinese consumers to travel to Europe to shop — and now with the halt of non-essential international travel — Mulberry’s global pricing alignment will only incentivize Chinese shoppers to purchase more feverishly domestically. Will this be an inevitable industry trend? Will more luxury brands consider this approach to survive the ongoing crisis? And how will it change travel retail and duty-free stores? Given all of these uncertainties, we shall see if more brands will consider taking this novel approach.
The Jing Take reports on a leading piece of news while presenting our editorial team’s analysis of its key implications for the luxury industry. In this recurring column, we analyze everything from product drops and mergers to heated debates that sprout up on Chinese social media.