The role of big data in understanding the effects of price promotion in the luxury fashion industry

The luxury fashion sector, recognized for its high sales volume, denotes products that convey prestige to their owners, irrespective of their functional utility, accentuating self-worth and societal esteem. While the influence of price as a determinant factor in luxury products has historically been overlooked in research, based on the belief of its insignificance to consumers, the role of price promotions remains even more under-explored, particularly in the context of luxury fashion. Some fashion brands adopt the policy of no promotion, others use promotional leverage but with little knowledge of its real opportunities and functions in the specific field. This research seeks to bridge this gap by examining the impact of price promotions within the luxury fashion realm. Utilizing big data—highlighted as a cornerstone for innovative analyses—sourced from a company belonging to this sector, this study evaluates consumer purchase histories. Through an enhanced Sequential Pattern Analysis (SPA) method, the research focuses on discerning purchase patterns related to price promotions. Preliminary findings suggest that there is a segment of consumer who are significantly motivated by pricing offers and more price-sensitive. Other segments, however, are more interested in the product and do not pay attention to promotional pricing.