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It will be very interesting to see if this pricing strategy is successful. If Everlane can promote to and convince consumers ad to HOW their bags are affordable i.e. cutting out the middle men. Consumers must believe that they are getting the same quality compared to $1000 bags. Not offering discounts is one of the major keys to getting this to work. I do love a good deal but if a bag was already significantly priced lower plus discounts I would begin to question the brand. Im convinced but will consumers be?

I think the best part about this article is when it states, "Everlane's big challenge will be convincing shoppers that they're getting a good deal by purchasing bags that would retail between $1,000 and $1,500 for a fraction of the price." They are right by saying that consumers have no idea how much retailers mark up a simple t-shirt let alone a purse/handbag. Many women show "status" by carrying high-end handbags by Louis Vuitton, Marc Jacobs, Coach, etc. Like the article said, these handbags can run upwards $1000 to $1500! Interested to see how their handbags will sell, I really like them!

The idea is really great, but I do worry about how they are going to advertise this to consumers to convince them of this great idea as well. If they can devise a plan to convince the consumers, then I think Everlane could be very successful. Though I am a huge fan of discounts, even if a $1000 bag were 50% off, I'd still be paying more than the $400 bag from Everlane. That being said, if they can convince consumers that the quality is still there, then I do think this pricing strategy could work.

This is a really interesting pricing strategy for a brand that is interested in conveying quality. The brands that come with status are known for quality but women are also attracted to the altruistic aspects that women get from carrying a name brand bag with a designer name on it. I think that if this strategy is to be successful then they need to build their name in the market by growing their popularity and quality through consumer testing and testimony. They need to get their bags to have that status before they can expect to be in the same market as the other designer brands.

I have seen the same pricing strategy before. A Dutch firm called Suitsupply sells high quality suits (also produced in Italy or Portugal btw) for medium prices (between $300 and 700$), even including in-store tailoring. They just started about 10 years ago but are now expanding all over the world. I visited their Chicago penthouse store last month and it looks really great. They also achieve those low prices by cutting out the middleman of the supply chain. The thing is that they rely almost only on mouth-to-mouth marketing and endorsements such as one of the WSJ that ranked a standard Suitsupply suit even above a $2000 Armani suit. What I want to say with this is that both Everlane and Suitsupply might have found a new way of price marketing that propells them in front of many of their competitors.

I think Megan has a good point, if the brand doesn't have a status then why would people believe or want to buy it? When a brand has a status it gives it an association with quality, high cost, and etc. The status and association is what I think draws consumers in to purchase the various brands that are of the designer level. The brand needs to establish itself as a brand of quality a before they can expect consumers to believe they are offering them a deal on this bag that is comparable to the quality of a designer, well known brand.