Price Elasticity Report Shows Impact of COVID-19
Data analytics firm Edited has crunched the numbers on online fashion pricing in the U.S. and U.K., which revealed upticks in certain categories such as luxury handbags and apparel and declines in footwear and activewear.
“Luxury handbags are getting more expensive as prices are raised to pad out margins,” authors of the report noted. “In contrast, designer footwear prices are slowly dropping in the U.S.”
Hoodies, bathrobes and sweatshirts — the seemingly pandemic-induced uniform for many consumers during the height of the COVID-19 outbreak — have seen price point gains “as demand for comfort continues to grow,” Edited said, adding that women’s sweatpants, though, “are becoming more affordable due to the saturated market.”
And despite the home workout boom, Edited said “pricing for sports bras and leggings have remained stable while men’s performance sneakers have seen a slight price decrease.”
Looking deeper at the pricing data and what’s driving it, researchers at the firm said luxury brands such as Gucci and Louis Vuitton are counting on the loyalty “of their wealthy consumer demographic to survive the pandemic” and, subsequently, “the average price of luxury bags market-wide has sat mainly higher than in 2019.” The authors of the report said in July alone, “the average prices on U.S. and U.K. sites saw a 12 percent and 18 percent hike, respectively.”
For luxury footwear brands, Edited said prices are dropping, with the average decline in the U.S. being 2 percent while prices in the U.K. slipped 0.8 percent. “Analyzing footwear currently available online in the U.S., styles seeing the most notable pricing decline [year-over-year] are women’s sandals [down 5 percent], men’s boots [down 4 percent] and both men’s and women’s sneakers [down 3 percent].”
When Edited looked at apparel on mass-market online sites, the U.S. had higher price points throughout the pandemic as compared to the U.K. “with July average prices 8 percent higher than 2019.” The researchers said in the U.K., “retailers have tried to regulate their price points to last year and show very little discrepancy.”
Other notable findings include an average price-point decline in U.S. activewear of 3 percent (as compared to six months ago). “Separately, all products currently online are cheaper or the same as before COVID-19, except for tank tops where the seamless trend bears some responsibility for the higher price tag,” Edited said in the report.
Finally, with the market becoming saturated, Edited said “prices for women’s sweatpants have become more competitive, noting a 5 percent decline,” while sleepwear is up 7 percent.
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