Where are the premium brands?

Posted by Oliver Koll on Sep 25, 2014

Folie2Many brand manufacturers strive to position their brands as premium in an attempt to achieve higher differentiation, loyalty and margins. A simple price-based analysis reveals that true premium brands are rare. Indexing brands’ prices to their PL peers reveals that only 13% of all brands command prices that are three times higher.

The majority of brands sells at a premium up to twice the PL price and almost 1 in 5 brands sells below their PL counterpart. There are also some interesting patterns regarding brand size: Large brands commanding more than 20% market share are less likely to sell at extreme premia, but also less likely to sell at a discount relative to PL.