The evolution of premium pricing in Japan

This article is a little hard to excerpt, but it's not so long and well worth the read.  Here is one bit:

High prices in Japan are mostly a direct product of governmental policy. [TC: There is then talk of tariffs, cartels, and inefficient retail.]…So when foreign brands come into the Japanese market, the most obvious brand positioning has been to go “above” the domestic makers and be “premium.” This almost necessarily means pricing at a higher level than the standard Japanese price, which as we know, was already very high. When Brooks Brothers came to Japan in 1979, for example, they logically needed to set prices above the Japanese copies of their items like oxford cloth button-down shirts and ties. More recently, the standard $25 T-shirt at Supreme in New York was set at around $60 in Japan.

The rest of the article explains why U.S. brands now try the strategy of undercutting the Japanese prices.

For the pointer I thank Conrad Clark.


Comments for this post are closed