Limited Editions As A Marketing Strategy
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    • Limited Editions as a Marketing Strategy

    To celebrate the launch of the latest James bond movie The Quantum of Solace, sony Corporation has launched a series of limited editions for its brands- Vaio and Cyber shot.

    Limited editions have always been the favourite strategy of marketers of luxury products. These products come in limited numbers loaded with features and attributes. The term ‘limited Edition’ has its origin in the publishing industry where limited numbers of copies of books are printed with top quality impressions. These limited edition publications are then sold at a premium price.

    Benefits of Limited Editions:

    · Induce Brand Rejuvenation

    · Consumer connect

    · Celebrating Evnets/occasions/Festivals

    · Test Marketing

    · Creating hype in the Market

    · Celebrity Endorsement

    · Enhance share of mind

    Although there are many advantages to using limited edition as a strategic marketing tool, these are expensive for both the company and the consumers because of the small volumes. Maruti once launched a two-door version of its popular Zen hatchback- car, but the variant failed to generate the desired response in the market. Marketers have to make sure that there is no compelling reason for the consumer to buy the limited edition product at premium.

    Many brands today introduce limited edition (LE) products as part of their product line. However, little is known about the conditions under which a brand should introduce an LE product or the competitive implications of doing so. Analysis shows that adding an LE product has a positive direct effect on brand profits through the increased willingness of consumers to pay for such a product, but also has a negative strategic effect by increasing price competition between brands. These effects result in different conclusions depending on the nature of brand differentiation. When brands differ in quality, we show that only the high-quality brand may gain in comparison to a scenario where there are no LE products. Although a low-quality brand may offer an LE product as a defensive strategy, its profits are lower than would be in a world without LE products because of the negative strategic effect. When we consider brands that are differentiated on a horizontal attribute such as taste, we find that the negative strategic effects cause lower equilibrium profits if both brands introduce LE products. Yet brands cannot avoid introducing LE products because they face a Prisoners' Dilemma.

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