Before you make this decision I think you need to think about:
- What your brand stands for?
- What its position is in the market vs your competitors.
- What is your consumer’s perception of the brand?
- If you go down market now, will you be able to crawl back up later? Or will it then be positioned as a cheaper product in the market?
- Do you really need to go down market or could you position it slightly differently to maybe appeal to a different target audience.
- Do you currently export? Could you focus more on the export markets? (With the dollar as it is, you probably make more money this way).
- Could you perhaps bring out a slightly cheaper product under a different brand name and therefore not damage your brand?
I think you can guess that I am not overly keen on a luxury brand going down market. In the downturn I would say that if you start to compromise your brand now then you are starting on a downhill slippery slope.
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The million dollar question is: What will you do when the downturn ends if you have gone down market?
Start with the end in mind; don’t just panic or you might regret it.
Lara Solomon is the founder of Mocks, mobile phone socks www.MyMocks.com and author of Brand New Day – the Highs & Lows of Starting a Small Business. Lara’s business LaRoo was the winner of the NSW Telstra Micro-Business Award in 2008.
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