• Brandweek, Thursday, March 12, 2009 10:46 AM

Most marketing pundits worth their full-valued salt have maintained that slashing prices damages the long-term equity of brands; now a new Yankelovich survey convincingly confirms that conventional wisdom. Proof positive, of course, is in the WSJ story above about Neiman-Marcus trying to restore a full-price mentality to its shopper's buying habits.

But for what it's worth, 70% of consumers responding to the Dollars & Consumer Sense 2009 study say such cuts probably mean the brand was overpriced in the first place; 62% say they assume that the product is old and the retailer is just trying to get rid of it.

Another potentially damning result of lower pricing is deflationary expectations, Kenneth Hein reports, meaning that consumers postpone purchases in anticipation of prices falling further. Up to 60% percent of those polled believe companies that cut prices will continue to do so.

Read the whole story at Brandweek »