A New York-based fashion brand, Telfar known for its popular shopping bag totes, is set to trial a new pricing model based on consumer demand. Founded in 2005 by Telfar Clemens, the brand has always aimed to make fashion accessible for everyone, with its egalitarian slogan, "Not for you — for everyone." The new live pricing model will be introduced for the brand's next collection, scheduled to drop on March 27 at noon EST.
Instead of fixed pricing, Telfar will use a dynamic pricing tool that allows consumer demand to determine the cost of its items. Prices will start at wholesale and rise incrementally up to retail price (the price the clothes would be sold at in a store). If an item sells out before reaching the retail price, it will remain at that discounted figure permanently. This innovative approach ensures that the fastest-selling and most popular items are the most affordable, disrupting traditional notions of supply and demand, scarcity, and value perception.
Telfar's new pricing system aims to challenge the fashion industry's norms surrounding pricing and dealing with demand. For example, a Cup Hoodie starts at $150 on launch day but can sell for up to $600.Clemens has stated, “Many brands use price as a barrier to entry. I never wanted that for my brand.” The dynamic pricing tool will be in place for new collections dropping until late April, allowing the company to collect data and gain insights into how to price future items.
"Telfar's decision to trial live shopping was a savvy move. Telfar customers are used to buying fast before items sell out, and now Telfar is creating a similar sense of urgency or FOMO (fear-or-missing-out), encouraging customers to purchase quickly or pay more later," said Retail Expert, Jeanel Alvarado.
"The prices are rather high though; one would expect a $65 T-shirt to be retail pricing, but the sale says these are wholesale price, thus allowing for a healthy profit for Telfar weather shoppers act fast or latecomers paying a premium price" said Alvarado.
The brand has positioned itself as luxury without prohibitive prices, offering products like the Telfar bag, which has been championed by celebrities such as Oprah Winfrey, Selena Gomez, and Beyoncé. While some people may consider Telfar bags expensive, with the medium-sized version costing just over $200, they are more affordable and casual compared to high-end brands like Hermès.
Alvarado added, "Telfar's popularity among young shoppers is soaring, and the brand is cleverly positioning itself as a luxury label while still sticking to its ethos of accessible fashion. It enables early adopters to get ahold of its products at lower costs. This means that those who purchase items on launch date benefit from low prices, whereas buyers after that must pay a higher premium. In theory, Telfar can raise retail prices without fear of a backlash, as long as shoppers remember to act fast!"
With this new live pricing model, Telfar continues to push back against the imposed boundaries of the fashion industry, staying true to its mission of making fashion accessible for everyone.
