Pricing objectives and demand factors in Starbury sneaker marketing

Starbury Collection

Stephon Marbury's pricing strategy to endorse a signature sneaker for $0.98 only demonstrates his objective for his brand to become the "cost leader" among sneaker products in the market. As a cost leader, Marbury's sneaker brand aims to appeal to a broader set of markets, offering them a sneaker collection that is similar to style, design and function as other leading brands in the market -- only, Marbury's sneaker collection, Starbury, is sold at a cheaper price than these leading brands.

The Starbury brand's positioning in the market reflects its pricing strategy. It appeals to a broader consumer group, which means Marbury's sneakers target a broad range of consumer groups. Starbury's customers range from young adults to adults. In addition, the inclusion of a clothing apparel line shows that the brand tries to be a 'lifestyle' brand to its target markets. As a result of its broad scope of target markets, it has low differentiation from the leading brands in the sneakers market. However, its pricing strategy sets the Starbury brand from its competition. Low prices appeal to a broader set of markets, which is in keeping with the brand's strategy and positioning. Sneakers as a basic commodity in the country today justifies Marbury's strategy to keep it at low pricing and broad market positioning. This justification prevents, if not totally eliminates, quality issues that can be used against the brand by the competition. However, despite these possible issues on the quality of Starbury sneakers, its low pricing can still be a factor that will make it a more preferred brand than the brand leaders in the sneakers market.

2. Consumer demand for Marbury's Starbury sneakers is dependent on multiple factors, namely: consumer taste, price, availability of substitute products, and consumer income.

As discussed earlier, Starbury's positioning is consistent with its pricing strategy: it can price its sneakers at a lower price than the competition since it targets a broader spectrum of consumers in the sneakers market. Inevitably, price is indeed a consideration, especially for a basic clothing item (footwear) such as sneakers. Starbury's dependency on its pricing strategy makes it a cost leader in the sneakers market -- not highly differentiated but captures a broader segment of consumer groups. The availability of substitute products further strengthens Starbury's positioning as a cost leader in sneakers. Because there is no close competition against Starbury in terms of pricing, consumers who only have budgets within Starbury's price range would prefer the brand over leading sneaker brands, such as Nike and Adidas. In this scenario, consumer income (budget) is factored in, which resulted to the consumer's preference of Starbury over Nike and Adidas, simply because the former satisfies the consumer's budgetary requirements compared to the leading brands. Consumer taste in the case of Starbury is another driver to consumer preference; while Starbury's style, design and function could be lower in quality than Nike or Adidas, its 'face value' similarity with leading sneaker brands make it appealing to its target market. Combining low pricing, at-par style, design and function, and limited availability of substitute products make Starbury escalate from a low-priced to a leading brand in the U.S. sneaker market today.