An investigation of the influence of premium pricing on customer perception of product quality during economic hardship: A study of a luxury brand in Kano, Nigeria.
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Background of the study
During economic hardship, premium pricing strategies are often used by luxury brands to signal superior product quality and exclusivity. In Kano, luxury brands adopt high pricing as a strategic tool to differentiate themselves in a competitive market, where consumers associate premium prices with enhanced product attributes (Okafor, 2023). However, the economic challenges faced by consumers may also lead to increased scrutiny of whether the high price is justified by corresponding product quality. Recent studies suggest that while premium pricing can elevate perceived product quality, it may also alienate price-sensitive segments during economic downturns (Ibrahim, 2024). This complex interplay between price and quality perception is critical for luxury brands that aim to maintain their premium image without compromising market share. The study investigates how premium pricing influences customer perceptions of product quality during times of economic hardship, examining the underlying factors that either reinforce or undermine these perceptions (Adebayo, 2025). The findings are expected to provide actionable insights for luxury brands seeking to optimize pricing strategies in challenging economic climates.
Statement of the problem
Luxury brands in Kano encounter significant challenges when employing premium pricing during economic hardship. While high prices are intended to signify superior quality, consumers facing financial constraints may question the value proposition (Okafor, 2023). The perception that a high price does not necessarily guarantee enhanced quality can lead to diminished consumer trust and reduced purchase intent (Ibrahim, 2024). This disconnect between premium pricing and consumer expectations poses a critical problem for luxury brands, as it can erode brand prestige and market position. This study aims to investigate how premium pricing during economic hardship influences customer perceptions of product quality and to identify strategies to bridge the gap between pricing and perceived value (Adebayo, 2025).
Objectives of the Study
To evaluate the impact of premium pricing on perceived product quality.
To analyze consumer perceptions of luxury products during economic hardship.
To propose pricing strategies that align with consumer expectations of quality.
Research Questions
How does premium pricing influence customer perception of product quality?
What are the consumer responses to premium pricing during economic hardship?
What strategies can luxury brands adopt to balance premium pricing with perceived value?
Significance of the study
This study is significant as it examines the role of premium pricing in shaping consumer perceptions of product quality during economic hardship. The insights will assist luxury brands in Kano in fine-tuning their pricing strategies to ensure that premium prices are justified by perceived quality (Okafor, 2023; Ibrahim, 2024). The recommendations will help maintain brand prestige and consumer trust even in challenging economic conditions (Adebayo, 2025).
Scope and limitations of the study
The study is limited to a luxury brand in Kano and focuses on the influence of premium pricing on customer perception of product quality during economic hardship. It does not extend to other pricing strategies or regions.
Definitions of terms
Premium pricing: The strategy of setting high prices to signal superior quality and exclusivity.
Product quality perception: The consumer’s assessment of the excellence and performance of a product.
Economic hardship: A period marked by financial challenges that affect consumer spending.
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