A two period pricing model for new fashion style launching strategy

Our main work is to illustrate in what condition and which one of the three strategies mentioned above is the firm׳s best choice, as well as the firm׳s best optimal retail prices over the two periods under them. Results show that a fashion firm׳s optimal launching strategy is mainly determined by the production cost and the consumer׳s mental book value. In detail, (i) when the consumer׳s mental book value and/or the production cost are relatively high, N-Strategy is the firm׳s optimal choice; (ii) when the consumer׳s mental book value is low and the production cost is high, S-Strategy is the best strategy; and (iii) when both the consumer׳s mental book value and the production cost are relatively low, the D-Strategy dominates the other two.