Superior good
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Superior goods are products that consumers are willing to pay a higher price for because of their superior quality, durability, or status. Examples of superior goods can include luxury cars, designer clothing, and high-end electronics. These goods typically have a higher profit margin for manufacturers and sellers, and consumers are willing to pay more for them because they perceive them to be worth the extra cost.
Examples of superior goods
Examples of superior goods include:
- Luxury cars such as Mercedes-Benz, BMW, and Porsche
- Designer clothing and accessories from brands like Gucci, Louis Vuitton, and Prada
- High-end electronics like Apple's iPhone or Macbook
- Fine watches from brands like Rolex, Patek Philippe, and Omega
- Fine jewelry from brands like Cartier, Tiffany & Co., and Bulgari
- High-end home appliances like Sub-Zero refrigerators and Viking ranges
- Premium spirits like Scotch whisky, Cognac, and fine wine
- Artwork and antiques from well-known artists and periods
- Organic and gourmet food products
- High-end furniture and home decor
It's worth noting that the perception of superior goods can vary from person to person and culture to culture, and can be based on factors such as taste, preference, and social status.
Superior goods sales strategies
There are several strategies that companies can use to increase sales of superior goods:
- Highlight the exclusivity and prestige of the product: Superior goods often come with a sense of exclusivity and prestige. By emphasizing these aspects, companies can make their products more desirable to consumers.
- Target high-income consumers: Superior goods tend to be more expensive than other products, so it makes sense to target consumers who are more likely to be able to afford them. This can include targeting consumers who live in wealthy neighborhoods or have high-paying jobs.
- Use influencer marketing: Influencer marketing can be an effective way to reach potential customers and generate buzz about a product. By partnering with influencers who align with the brand's image and values, companies can increase the desirability of their products.
- Create a strong brand image: Building a strong brand image can help to establish a product as a superior good. This can include creating a high-end, sophisticated image through advertising and packaging, as well as offering excellent customer service.
- Use experiential marketing: Experiential marketing allows consumers to experience a product before purchasing it. This can include offering test drives for luxury cars, hosting fashion shows, or offering private viewings of artwork.
- Personalization and customization: Personalization and customization can make a product feel more exclusive and unique to the consumer. This can include offering custom-made jewelry, bespoke suits, or special edition luxury cars.
- Emphasize craftsmanship and quality: Superior goods are often associated with high-quality craftsmanship and attention to detail. By emphasizing these aspects, companies can make their products more desirable to consumers.
- Partner with other luxury brands: Partnering with other luxury brands can help to increase the prestige and exclusivity of a product. This can include collaborations with fashion designers, luxury car manufacturers, or other high-end brands.
Superior goods in economic boom and crisis
During an economic boom, sales of superior goods tend to increase as consumers have more disposable income and are more likely to make luxury purchases. As people feel more financially secure, they may be willing to spend more money on high-end products and brands. Additionally, during a boom, businesses also tend to have more revenue, which can lead to them making bigger investments in advertising and marketing, making these superior goods more attractive to consumers.
On the other hand, during an economic crisis, sales of superior goods tend to decrease as consumers have less disposable income and are more cautious about making luxury purchases. People may be more focused on saving money and may prioritize their spending on necessities rather than luxury items. Businesses may also be impacted by the economic downturn and may not have the resources to invest in advertising and marketing. As a result, consumers may be less aware of or less interested in these superior goods.
It's worth noting that, while superior goods tend to be less affected by economic downturns than other products, they are not immune to the effects of a recession. However, it's often the case that luxury goods companies have a more loyal customer base, so they can still maintain sales even in tough economic conditions.
References
- Yao, S., & Li, K. (2005). Pricing superior goods: Utility generated by scarcity. Pacific Economic Review, 10(4), 529-538.
- Kohli, U. (1985). Inverse demand and anti-Giffen goods. European Economic Review, 27(3), 397-404.
- Moral-Arce, I., Sperlich, S., & Rodriguez-Póo, J. M. (2013). Consumer behaviour analysis for luxury goods: a technical note for empirical studies. Applied Economics Letters, 20(4), 358-363.
