Latest report: Fashion retailers turn to optimized discounting to manage inflationary pressures

BERLIN - March 31, 2025 - PRLog -- Fashion retailers have been under increasing pressure to adjust their pricing strategies to remain competitive and drive sales in a challenging market. In response, brands and retailers are increasingly focusing on optimized discounting as a means of managing inflation and avoiding excessive price hikes. Cost and competitive pressures also led to price convergence between brand stores and marketplaces.

These are the findings of a recent report by 7Learnings in collaboration with Dealovo. Price data from 966 brands and 1,006 retailers for the period from 2023 through 2024 was analyzed for the report.

Strategic discounting reduces inflationary pressure

Analysis of the price data shows that overall prices in 2024 are higher than in 2023, as expected. However, it should be noted that the rate of increase has slowed down.

Despite the increase in original prices, average discounts in 2024 are lower than in 2023, suggesting that retailers are using discounts strategically to persuade consumers and keep prices affordable.

By optimizing discounts to temper rising original prices, retailers can effectively cushion the impact of inflation. Retailers and brands maintain their competitiveness by avoiding significant price increases that could deter customers and drive them to competitors. This also impacts brand image as the perception of affordability is prioritised.

Price convergence for brand websites and marketplaces

Another trend revealed by the report is the convergence of pricing strategies between brand websites and marketplaces. In the past, brands had higher prices on their own platforms, while marketplaces lured customers with discounts. However, brand shops are now adapting their prices to the marketplaces in order to remain competitive.

AI supports strategic pricing and discounting

The Tamaris case study shows the potential of artificial intelligence (AI) to optimize discounting. By implementing a predictive pricing tool, Tamaris was able to reduce its overall discount rate by 5 percent. This technology enabled the company to increase profitability without jeopardizing sales.

'Our analysis shows that fashion companies that are data-driven and using modern technologies such as AI are able to optimize their pricing strategies and remain competitive in the long term,' says Felix Hoffmann, co-founder, and CEO of 7Learnings. 'This report provides valuable insights and practical recommendations to help companies improve their pricing and discounting strategies.'

Outlook for the fashion industry

Looking to the future, the report calls on fashion companies to focus more on data-driven discount strategies and AI-supported optimization. This will help to increase profitability while securing consumer engagement.

Download the full report: https://7learnings.com/resources/download-the-state-of-fa...