Smarter Pricing: How to capture more value in your market

1. Innovation, novelty and new products

Low-price operators must make savings in order to give discounts. When these savings are in research and development, to avoid costs or risks of new product failure and the low volumes of new lines, an opportunity is opened for innovation as a differentiator.

How it works

The women’s clothing chain, Zara, has more than 700 stores in 54 countries. Design is seen as an active innovation process. Every day comments and behaviours from customers are fed back to Arteixo design centre by store staff using handheld communication devices. The 200-strong design team respond and new designs are shipped to stores twice a week. Value-playing competitors may be lower price but they lack the innovation that fashion ...