Payless’s “Palessi” Demonstrates the Power of Brand Positioning

This article was originally posted at TC Creatives

For as long as we can remember, we would go to a mall, glance through a Payless window, and continue to walk on. Not because there was anything wrong with the shoes or socks, but because it was Payless. The shoe chain, known for its trendy styles and cheap (yes, we said cheap) pricing, has a reputation to be just that; cheap.

Over the years Payless’s quality and styles have improved. However, because of its brand positioning, we hadn’t noticed. To create more awareness of its quality products, Payless built a luxury pop-up store “Palessi.”

“Palessi” took over an old Armani store in Santa Monica, CA. They created a luxury influencer event and invited people to shop. They marked up their regular $20–40 pricing to $200–600. What happened next is amazing.

“Palessi” sold almost $3,000 in a few hours. After customers had purchased the shoes, they revealed that they were actually from Payless. This is not a phenomenon; it is brand positioning.

What is Brand Positioning?

Brand positioning is “the act of designing the company’s offering and image to occupy a distinctive place in the mind of the target market” (Philip Kotler, the father of modern marketing). It helps to set your business apart from the rest.

This key part of your brand strategy helps you to use your “onliness,” what is unique to your business, to stand out from competitors. Early in your business development, you should spend time planning on how to position your brand at launch strategically.

Brand positioning happens with or without the owner’s input. Being proactive helps to manage how your brand will be perceived by its buyers, having a positive impact.

We see how this perception works all the time in retail. Because of brand positioning Supreme can sell clearly marked Hanes T-shirts at a 407% markup. At the same time, people are having strong feelings about Michael Kors’ recent purchase of luxury brand Versace.

Why did Palessi work?

Perception

Brand positioning is a crucial part of any brand strategy. It’s almost like the “fake it until you make it” method. Whereas, you are that of which are you perceived to be.

When business owners start companies, they have a mindset that they have to start small. They believe that they have to offer free products and services, or they have to have low price points. This mindset hurts the business.

It is harder to tell someone that they have to pay $600 for a product or service that they have previously purchased for $99 than it is to sell for the former, to begin with.

By having a higher price point, and a luxury style store, “Palessi” was able to position its brand into the luxury market. This position helped the $20 products appeal to a more upscale audience.

Price Denotes Quality

We live in a society where material things are a symbol of wealth and success. People sometimes buy high ticket items, for no other reason, than to say they own them. Having these things creates the appearance that they live a luxurious lifestyle.

In contrast, things that are inexpensive are seen as cheap and low quality, like Payless shoes. This is regardless of the actual quality of the product. We see this in the previous example of Michael Kors and Versace. Some people believe that because Michael Kors is a lower quality brand, it will cheapen Versace and its positioning in the luxury market.

Create Your Brand Position

Brand positioning should be one of the early strategy decisions when building your brand. First impressions are everything, and you can spend years trying to change how customers perceive your brand.

Being proactive in your positioning helps to encourage position reactions to your products. When launching your product, create a strong positioning strategy to get into the minds of your buyers.

Charge full value for products and services to create perceived value in buyers. Of course, your products and service does have to have some value to begin with but do not shy away for charging your worth.

Your brand position changes over time, both positively and negatively. As a business owner you have to monitor brand mentions and continually work to make sure your brand positioning stays as desired.

Shoot for the stars. Start your business strong and bold. If necessary, make adjustments. Because no matter what, you and your brand are precisely what YOU SAY THEY ARE.