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This is deceptively complex question as the answer requires an explanation for how consumer-fashion brands price products and subsequently the factors that drive price deviations. This answer is broken up into 2 parts:1. How are prices in consumer-fashion set?: This reviews the actual pricing analysis from two of previous footwear brands with illustrated examples to explain how pricing is done in the real world.2. Why are prices on a brand’s site different from a retailers? Illustrates the market, organizational, and strategic challenges facing the current landscape for consumer-fashion. These factors drive the price discrepancies & explains why they occur.As many of you know, I run a brand called Cloven Footwear - a men’s outdoor footwear brand that just launched SS12. For purposes of answering the question, I will illustrate in-depth analysis of how we priced one of our launch models and the problems that are inherently involved in the process. Since Cloven has not been in the market for consumers to purchase, the answer will pivot into actual data from the VÆL Project’s Deckard Boot to provide more insight into the observed pricing deviation.1. How are Prices set in Consumer-FashionConsumer-fashion is a bare knuckle, knock ‘em down, drag ‘em out brawl that is hands down on eof the most challenging, engaging, and addicting industries that I have ever worked in. It is an insanely ambiguous and obfuscated operating environment surrounding the horrendously complex brand development and diffusion processes.In order to effectively serve the marketplace, the consumer-fashion industry is split into two complimentary segments of brands and retailers. Brands focus on designing, producing, and delivering great products to the marketplace that engage their target demographic. Retailers focus on optimizing their brand assortment, inventory quantities, and demand generation that maximizes product / market fit for each retail location or property.GAP’s terrible financial performance throughout most of the aughts is probably the best example of the risks & challenges that can plague a vertically integrated retailer when one of these two divisions is lost (in GAP’s case it was that they lost their product-mojo and are only just starting to get it back). Hence the specialized focus of these two partners has governed the strategy for consumer-fashion & retail for the better part of the last 20 years - the core reasons that this has been successful the business model are:Retailers:Derive long-term value from major investments in building customer mindshare (i.e. ‘I think that I am going to stop by Bloomingdales on Saturday’)Have extensive customer insights that enables retailers to optimize their merchandising assortment of brands, styles, and inventory quantities dynamically for each location (i.e. GAP only sells GAP stuff and that’s risky if the GAP product sucks)Trying to own the brand side is hugely expensive & massively risky when the entire organization has been built around the retail sideBrandsGreat product design & authentic brand narratives emerge from data-informed & design-driven cultures (versus being reactionary in data-governed design - although Zara and H&M are dialing in a damn good solution that could prove this wrong)Brands begin life by focusing on one product vertical (i.e. Cloven for men’s outdoor footwear) & don’t have the resources nor the product depth required in the demand generation model (remember we are talking about the last 20-years - we’ll get to how the world is today)Need the freedom to work with hundreds of retailers to effectively distribute inventory risk and disseminate the brand narrative to ‘get the word out’Before the onset of the Great Recession & technical innovation began to sow the seeds of change, consumer-fashion brands’ B2B wholesale (i.e. retailers) generated around 80 - 90% of revenue from retailers for the first 2-years. This relationship creates two transaction points where the product is 2x the cost basis for the preceding transaction - a theory in retailer called “Keystone Markup”.Keystone Markup is a pricing methodology that multiples the cost basis by a factor of two (sometimes can be up to 5x in the case of jewelry) to dictate the price for next rung in the value chain. Keystone markup arose as the simplest way to universally markup goods across the retailer to a profitable level. Generally speaking, it is logistically impossible to uniquely price each product (from 100s or even 1,000s in a given retail location) to reflect market conditions and retail demographics. The theory being that retailer profitability was more of a function of units sold versus maximizing each product’s price. Subsequently, this approach normalized prices across the marketplace (i.e. everyone is pricing a shirt at $100).Brand to Retailer: This is the B2B wholesale transaction where the brand sells products to the retailer at wholesale price. This B2B price is based on theory of audiences of scale (i.e. millions of customers going to Nordstrom brick and mortar retail stores and online properties) who should receive a discounted price (off retail price) for the retailer’s contribution in the consumer fashion dichotomy. The brand sells to hundreds of retailers to provide them with the volume of units required to run their business profitably.Retailer to Consumer: This is the B2C retail transaction where the retailers sells product to the customer at retail price. The retailer sources product from hundreds of brands to dial in their product mix for selling product to their customers.Now that we have established the basic building blocks for pricing, we need to establish the market rate to understand how individual products are priced in the marketplace. When you are in the beginning stages of launching a brand, you do a ‘market analysis’ to clearly define the competitive landscape. This competitive analysis determines the corresponding balance of style, price, and quality that enables the brand to most effectively capitalizes on the opportunity.The product’s price must reflect a value proposition relative to where the competition is positioned. The rationale is that the overall product landscape establishes the data points that a customer will evaluate the product relative to what the customer sees as comparable goods. In consumer-fashion there are general pricing bands that establish certain boundaries for potential pricing. For example, one of the launch styles for Cloven was a boat shoe where the pricing bands for a mid-tier boat shoe are about $70 - $90 retail price. This means that pricing the product outside of this range immediately draws a red flag in the eyes of the consumer as being out of place (i.e. not in the $70 - $90 expected price range) - so pricing is heavily dependent on consumer expectations.There are two important aspects of this foundation:Prices are confined to ranges of established norms outside of the brand’s control & constrained by the consumer’s expectations (i.e. ‘if you are going to make product for this market, you have to price within this range to even be viable’)The price range is a subjective analysis of the competitive landscape from the brand’s perspectiveTo illustrate how prices are set, let’s roll through the process for how Cloven conducted the market analysis and subsequently arrived at our retail price.1. Market Product Opportunity Analysis: The strategic analysis of how competitors have positioned their brands & products by price - where price is the defining metric to govern the product development of the startup2. Define Strategic Brand Position: Formally establishes where the brand will sit in the marketplace to serve as the unifying creative direction of the brand.The potential price is inherently defined by how the brand needs to position its product relative to where the competition is. The logic behind Cloven’s pricing is:The market is defined by the Sperry’s Authentic Original boat shoe - it has been in the market since 1935 and is one of the first shoe styles ever created - anything that Cloven would produce would be compared relative to this anchor product.Cloven uses a super interesting technology that will offer a dramatic improvement on fit & comfort over current Outsoles used in production - leading to a fit and comfortable advantage over the competitionCloven uses Outsole & Midsole tech to reduce leather quantities generating a lower cost basis that allows Cloven to compete on price as a small company without economies of scalePricing below Sperry will offer an incentive to the customer to try on the product - competing on product quality for brand-insensitive customers (i.e. ‘I don’t care what brand it is so long as it fits well’)[Note: For the rest of this answer, we are going to pivot to an actual example from my old brand VÆL Project’s Deckard Boot.]3. Wholesale Price: Wholesale price is the price charged by the brand to the retailer for product that they have ordered - it’s revenue to the brand and represents the cost basis of the retailer. The general rule of thumb is that wholesale price is a 2x keystone markup on the first cost (the total cost to create finished goods ready for sale in the marketplace) or in other words - wholesale price is a 50% discount (0.5x) retail price.However, the simple world of 2x keystone markup is ending as ERP and IT Systems enable new insights in all aspects of the retail business that were previously abstractions based on averages. Today, most brands are under considerable pricing pressure from retailers to markup wholesale price at less than 2x to provide the retailer with the margin required to profitably sell the product. Retailers are marking up wholesale price 2.1x to 2.4x to compensate for inventory markdown & return risks that delivers the overall margin required to achieve the profitability goals of the firm. This focus on margin is a function of increased adoption of IT Systems that allow deeper insight into product performance on the brand and product level versus the obfuscated aggregate view that plagued organizations just 5 - 7 years ago.Despite the major strides in retail analytics, it’s still a major challenge to dynamically price products based on demand signals and current stage of brand development - subsequently, retailers generally apply a universal markup on wholesale price to derive the retail price. Both brands and retailers live and die by the wholesale price - if it’s too low then the brand risks not generating enough Contribution Margin to run operations and conversely if its too high then the brand risk pricing the product outside the optimal competitive price range.The important aspects for a brand’s wholesale price are:Wholesale price is a dance that requires the brand to balance the scope of retailers markup strategies with the realities of order volume and profitability constraints on funding the brand’s operationsRecognizing that setting the wholesale price on the high end of the range allows the brand to always back off the price through discounts on product (i.e. 5% off wholesale price for 1,000 units) or marketing discounts (i.e. 5% discount for ad-spend or marketing placement).This is an example for how pricing works in the market:4. Product Development: After you have your target price and wholesale price, you begin to work backwards to define your costing & materials. The operating cycle in consumer-fashion is traditionally 12 - 15 months meaning the from the time you have your design to when it finishes its basic life cycle in the market.One of the main problems with the launching a new brand is that you have absolutely zero pricing power - meaning that you have the market setting the price within a narrow range & subsequently have a high cost basis to manufacture product. This begins the most challenging part of this stage - the tweaking of materials to levels that deliver sufficient quality right up to the monetizable equilibrium between the quality of the materials, construction of the product, and the customer’s willingness to pay for these costs. Keep in mind that $0.50 in manufacturing costs equals about $2 at retail (2x markup to wholesale and 2x markup to retail).Here is an example of the product development revisions made to the VÆL Deckard Boot to dial in the first cost subject to the constraints of wholesale price & retail price.We are in a very interesting period in the modern business environment as the fundamental business model that has ruled consumer-fashion for the last 20-years (what was referred to in the 90s as the ‘China Strategy’) is dying - the world of cheap goods is over. Factories in China are closing and the good factories are dropping small & unprofitable brands to stem the losses from 20% real wage growth & materials inflation like leather (cows eat lots of corn & most hides are shipped from the US to China for tanning).In footwear particularly, a brand has essentially zero pricing power or ability to generate economies of scale for a considerable period of time. The break points are generally around 15,000 pairs, 45,000 pairs, 80,000 pairs, 150,000 pairs, 400,000 pairs where prices drop by 10% - 15% successively at each interval.===============================================Why do dresses cost more on a designer's website?===============================================Consumer-fashion at its core is highly tactical, deeply psychological (a style/trend gaining momentum is highly reflexive of the mood that pervades social-cohorts), and heavily dependent on intellectual-capital (i.e. aesthetic, creative, and strategic direction requires immense cognitive investments).Direct business (brands/designers selling product directly to the customer via it’s website) has been an ancillary consideration to most brands (i.e. the direct business took the back seat to wholesale (brands traditional B2B revenue channel for major retailers like Nordstrom & Bloomingdales).2.1. Conflicting Priorities Destroy Feedback Loop:One of the fundamental problems driving price deviations in consumer-fashion is the dearth of communication & data sharing that adversely inhibits the development of a healthy & efficient feedback system between the two primary vertical partners, Brands & Retailers. This is a structural problem that arises from the business cycle at two distinctly unique phases:1. The Buying Cycle:The traditional (... and rapidly deteriorating) business model for consumer-fashion revolves around 9-month seasonal sales cycle, where 80% of a brand’s revenue is generate through B2B wholesale orders place by retailers (via ‘buyers’ - the person/team responsible for procuring inventory from brands that achieves the optimal merchandising assortment for the retailer) at major industry trade shows. The importance of trade shows in the archaic business model for consumer-fashion arose to provide a convenient, centralized location and time frame for retailers to touch, look, and feel all the products from hundreds of brands, dial in their merchandising assortment for complimentary products (i.e. boots from Brand X that would look great with the selvage denim from Brand Y) in direct, comparative context, and account for the production lead times for brands to manufacture the goods.At the trade shows, brands exhibit their seasonal collections of ‘samples’ - the array of potential products that are in the final stages of product development and represent the full product mix. Buyers subsequently place orders for the styles, variations, and quantities that they believe will work best for their customer based on what other products in the pipeline, the goals of the merchandising assortment, the retailer’s brand & market position, customer & sales development strategy, and customer demographics. Obviously, brands are only going to go into production on the styles & variations (variations are generally the different colors - they have the same parent style, but differ by color) that retail buyers have placed firm orders to produce.The trade shows are scheduled around the seasonal production cycle for brands:Jan - Feb: Trade ShowsMar - Jun: ProductionJul - Aug: Shipping & Inventory TurnSep - Nov: Selling SeasonThis process inherently does not make sense to me because an entire segment of the consumer-fashion industry is basing major, life-and-death decisions on product volumes for inventory based on a proxy demand signal - the retailer buyer serving as a representative agent for consumer demand. Now the most accurate forecasting methodologies still involve are a weighted algorithmic + Delphi Expert Model, but even with the incredible strides in retail analytics - the concept of elite group of people (buyers) controlling major segments of the ecosystem through their assessments of what they like or believe the customer likes. The prevailing theory that drove the evolution of this model was that buyers have all of the extensive customer intelligence gained by the retailer that is inherently put into practice through the B2B wholesale order placed with the brand at the trade show.The major problems with this stage of the pricing model are:- The order placed the buyer is a based on limited historical data constructed by vanity-analytics like gender, category, and price - these top-line numbers are generally too broad to deliver true insights to account for brand-specific factors- This order does not take into account endemic brand factors like the current stage of brand development, customer mindshare, marketing & promotional activities of the brand - all demand signals that will substantially impact retail performance- There is a disconnect between the end-customer even having the opportunity to see the scope of the product landscape (products that perform poorly with buyers at the trade shows are dropped and never make it to retail) - buyers are making decisions for the customer as their representative agents with only tertiary support of this relationship (by monetarily supporting the retailer based on the product assortment)Bottom line for how this influence priceThe marketplace is directed by buyers:placing orders for product constraining the product scopeforecasting quantity demanded by top-line data that doesn’t factor any endemic brand-specific factorsorder determined 9 - 12 months before the product hits retail shelves and the customer even has the opportunity to product ‘market fitting’ feedback[Note: I am not trying to take a piss on buyers - I have an immense amount of respect for what they do and consistently am awestruck by some of the most talented buyers in the industry.Being a great buyer requires that they procure products that customer’s will purchase for the current season, but they need to build a product pipeline of demand for styles that they are financially judged against. This means that they need to stay ¼ step ahead of their customer falling into 3 - 5 different customer-demand narratives to balance current demand while seeding trends for the next season. Great buyers introduce a style one season as an outlier styles that drive purchases next season to capitalize on demand as the trend diffuses over the current season. Furthermore, buyers need to prime for trend shifts that will be hitting the market in one year (and subsequently require introduction today to incept the idea and begin to trigger the want/demand at the correct time).Buyers are what we would know today as curators except they are under incredible levels of stress as their decisions are made way in advanced and responsible for financial performance of the retailer. If a buyer screws up one time - they can destroy profitability for entire product lines or divisions. After spending a lot pf time working with buyers over the last 10-years, I generally don’t like a lot of buyers because of the ‘too cool for school’ mentality that drive purchasing decisions based on ego rather than data-informed and intelligent. Hands down the best buyer in Men’s is Emma Lee, at Gilt Groupe - to say that girl is brilliant is an understatement as I consistently look at what her buys tell me about the industry.]2. The Sales Cycle:This is where the plot thickens and gets really interesting - let’s fast forward 9-months through the ordering, production, and shipping & fulfillment to a retail store - the product is now on the retailers website or store shelves. Customer’s now have the opportunity to purchase the brand’s product. In retail, there are certain sales level that innately occur simply by virtue of product being in the marketplace - the product is on the store’s shelf, the customers it, likes it, tries it on, and buys it - easy peasy lemon squeezy. However the vast majority of sales are generated following about 11-touch points with the trend/style/brand/products - meaning that converting consumers into customers requires on average about 11 touch points with the product on blogs, in marketing, at retail, or the consumers wearing the product to generate sufficient customer mindshare that drives purchase actions.The most exciting data is the on the ground sales staff qualitative data collection and archetypal narrative development. Talk to a really good sales reps at Nordstrom - they have massive mental databases about the most valuable customer behavior and how customers break down aesthetically to certain groups (this is highly subjective data and definitely subject to huge bias - but the fact that it’s based on a significant amount of time & transaction by sales reps building the insight on the actual transaction level makes it far more interesting than #s on a page as each instance is embodied by a visual reference).Remember how in the ‘Buying Cycle’ section, I commented on the prevailing logic was that retailers have all the customer insight? Well, the systems is fundamentally screwed up in that retailers do not share any of this data with their vertical partners - it is viewed as a competitive advantage and subsequently the property of the retailer. This data-silo’ing behavior adversely constrains brand partners from foundation level data to inform the basic comparative framework in the ‘Market Analysis’.Retailers protect this data because they are desperately clinging to this as a competitive advantage (like Networks in releasing content to the web that fuels piracy) and do not share it because they are scared that brands will usurp the retailer and go straight to the customer. Ironically, it’s this protectionism that is forcing brands to build their own consumer-direct relationships to gain this information.This protectionism mentality creates the following main challenges in the ‘Buying Cycle’:Retailers do not have the resources nor the incentive to effectively make use of this purchase data for the 100s of brands that retailers stockDemand generation is the responsibility of the brand - how can brands make meaning use of data to refine the product mix & pricing mix if the market feedback is hidden from them? For example, let’s say I ran a marketing campaign with a discount of 15% off a pair of shoes at Bloomingdales San Francisco. that discount code must be able to be scanned and accepted by the Bloomingdales ERP - meaning that the brand loses any insight about the customer and has given up generating any long term value from issuing this discount.By not sharing feedback like this and relying on the brand to drive demand generation (i.e. the brand driving traffic to the retail partner), the brand is incentivized to full that support from the retailer and focus on owning the customer relationship in a way that creates the most strategic, long term value for the brandIt would make sense to drive traffic to the brand’s core strategic objectives like the brand’s Facebook Fan Page or to the brand’s E-Commerce site to work on building the customer relationship.- How do brands discover marketing channels when customer insights about referral traffic is deliberately hidden from the brand? If the brand is responsible for generating online traffic and sending traffic to Bloomingdales but cannot benefit from the customer insights then how can brands tailor marketing campaigns?- [Most Important] Brands cannot effectively price products without substantive insights into the data feed meaning that there are systemic problems with this modelBottom line for how this impacts pricing: Conflicting priorities between vertical partners drive information asymmetries that inherently inhibit accurate insights into the ‘market fitting’ pricing feedback and leads to widely inaccurate information fueling pricing discrepancies.2.2. High Subjectivity and Large Biases Adversely Impacting the Comparative Pricing Analysis:In Section 1, we discussed that the first stage of pricing involves the brand conducting a market analysis of the competitive landscape. This market analysis establishes the brand’s evaluation of the strengths and weaknesses of competitors products and determines an implicit estimation for how the brand will balance style, price, and quality that will most effectively capitalize on opportunities in the marketplace.This market analysis is an extremely challenging process because of the dearth of information available at the product level (retailers protect this data) and the high degree of managerial bias in evaluating competing brands & products for this framework - there is simply no way to extract transaction data from the marketplace. There are proxy signals like time to discount and channel checking via local retailers, takes time that’s not really practical as pricing decisions are made 9 - 12 months before products hit retail shelves - but no hard data available to brands to truly substantiate traction based and product / market fit effectiveness for products in the analysis.Additionally, the pricing strategy is driven by highly-emotionally biased managers that deeply invested & fluent in brand-specific details. This leads to a managerial bias that outweighs product differences in favor of the brand - most of which is are not reciprocated by the uninitiated new market participants (i.e. customers).This problem is seen all too often in tech when founders focus too deeply on a niche and product features as a source of competitive advantage. For example, let’s take a fictitious daily deal startup that also schedules the local services in conjunction with the daily deal (i.e. eat at this restaurant at 2 PM or the massage at 3 PM). I have heard probably 20 - 30 pitches over the last year where this occurs that the founder will say that the scheduling is what differentiates them from Groupon or LivingSocial and has lost site that features are not a source of competitive advantage. In the same vein, people who work in consumer-fashion (and I, admittedly, have found myself to have done this numerous times in hindsight) become so ingrained with their products that profound product differences to internal team does not translate into how the customer sees it.Furthermore, the current phase of the brand’s development process dramatically skews the comparative analysis. New brands that are just entering the market have little traction and social proof to validate their brand & product strategy leading to an inherent undervaluation of their product and overvaluation of their competitors (the though being “well, this more established player is priced at $80, so we need to be below them because no one knows who we are.”). Subsequently, a brand that has caught fire and are generating substantial traction begin to overvalue their historical success as the basis for vertical product extensions and new found ego-based biases that overvalue their pricing power to command above market rates.Bottom line for how this influences prices: The subjectivity and biases associated with the initial pricing framework is one of the most important factors in understanding why prices deviate between retailers and consequently from retailers to brand direct. The price is established by emotionally-invested managers that are heavily entrenched in relative valuations of their products and do not have the information resources to effectively adjust the pricing strategy before going to market.2.3 Supporting Legacy Revenue Channels with Conflicting AgendasAs we established in section 1, Retail Price is a function of Wholesale Price that the brand sets based on the market analysis and Brand Strategy. In the traditional consumer-fashion retail environment where B2b Wholesale represents upwards of 80% of the brand’s revenue, brands set Suggested Retail Price on their websites at the top end of the marketplace, and often times above the ‘actual’ retail price quoted to retail partners, to support the B2B revenue channel and make retailers appear like a good value / discount.Prior to 2010, it was an inordinately challenging process for brands to generate sufficient online traffic in consumer direct (i.e. BrandXYZ.com E-Commerce Business) to be a strategic priority for most resource starved brands. The prevailing theory was that retailers have made the significant investments to build customer mindshare and owned the customer relationship so it was in the best interest of the brand to drive traffic to their retail partners.For most brands without significant online consumer-direct presences, which was most brands before 2010 when you began to see brands 10Qs pepper in statements targeting 15 - 25% of revenues coming from consumer direct channels, the brand’s site served as an authoritative reference for product information to consumers on price. This meant that on artifically high prices set on the brand’s site and comparatively ‘better’ price on the retailers would generate opportunity costs to drive purchase via the retailer.In the majority of cases, a brand’s site served as an authoritative reference of product information source about brand’s products where an artificially high price would make a comparatively lower price at the retailer assuage concerns with any consumer. With B2B Wholesale responsible for such a large portion of revenues, it was thought that driving a small number of traffic (the aforementioned inordinately challenging process) would assuage price-checking customers concerns to deliver these customers to the most strategic purchasing channel.One of the core value propositions that retailers create is the cultivation of mindshare (‘I am going to go to Bloomingdales on Saturday’) and generation of significant amount of goodwill as the customer - whereby the customer had dealt with the retailer & the brand served as the product of the retailer. If the customer loved the brand, the retailer was the beneficiary of the customer’s goodwill/happiness as the provider of the garment (versus the brand as the producer of the product - it's a level of abstraction away from a direct relationship between product & consumer). The retailer controlled the relationship and therefore is the recipient of the customer's projected satisfaction or enjoyment of the product (as opposed to the brand that created the product).Establishing mindshare & building goodwill deeply connects consumers with retailers - a trend that is even far more pervasive online as offline. Online shopping for consumer-fashion is a world of information asymmetries that, when done properly, engenders significant brand engagement & loyalty (i.e. fanatic Zappos customers thrilled by overnight shipping, free returns, and killer customer service). One of the most interesting things about a high Suggested Retail Price on a brand’s site enabled a certain flexibility for retailers to set prices at optimal levels for their target demographics.To support their retail partners, brands would set the Suggested Retail Price at the top line of the marketplace with the understanding that retailers would adjust their prices to what works for their customers.Historically (i.e. before 10 years ago), if a fashion-savvy teenager wanted to purchase an item from Abercrombie & Fitch & there wasn't one located in the local mall - there were two options: 1. purchase via mail order catalog or 2. wait until they took a vacation to a location that had an Abercrombie retail store. Great consumer-fashion E-Commerce sites understood that their value proposition was in their ability to generate significant loyalty by serving the void in the marketplace that the fashion-savvy teenager wants across the country.This process of E-Commerce sites being one of a very select # of Online Retailers to retail the cool brands has the same impact that boutiques traditionally held & create pretty loyal customers that are branded to one property over another - say Tobi.com to RevolveClothing.com. This is not like daily deal sites like the zero sum game that LivingSocial & Groupon engaged in an epic trench-style war of attrition - customers are predominately StyleABC site or StyleXYZ site with little overlap.By pricing on the high-end, the brand enables the retailers to dial in their pricing model to what works for their customer & explains why this prices can vary significantly from retailer to retailer as well as designer/brand to retailer.2.3.1 Tertiary Drivers in the Legacy Channel1. Cash Requirements:Product Information Management is a major challenge for any E-Commerce company & consumer-fashion brand - especially when technical development is not an in-house core competency of the firm. Therefore, more E-Commerce sites historically implement blanket discounting models - if the product has X% remaining stock after 4-week then the product is automatically discounted by 10%.Once an order to a retailer leaves the docking bay, the ownership of the product changes to the retailer - an accounting & legal concept call FOB or ‘Free on Board’. Thus, the brand has little functional control as the retailer owns the product & has the financial imperative to ‘turn’ the inventory. The brand can do things like threaten to pull the account from a retailer - but this does not happen most of the time because the brand needs the retailer more than the retailer needs the brand.2. Organization Oriented Around B2B Wholesale Business:Brands are still predominately organized to serve the business model of the last 20 years - where sales reps ( glorified order takers ) form the backbone of the revenue generation priorities of the firm. A small consumer-fashion brand ( <$10m) has approximately 3 - 7 sales reps covering geographic locales - remember this model is geared around sales reps who would put samples in the car and drive around their territory to sell shops.In the wake of the financial devastation brought on by the Great Recession, management teams for consumer-fashion companies retreated back to what they know best. Generally speaking these are guys and girls in the 30s & 40s (Gen-y’ers) whose first response is to get back to basics (i.e. the dying 20-year business model) to keep the company alive - thereby reinforcing the sales rep’s sole in the company & managerial support for this model3. Drive Retail SupportMajor retailers were the primary revenue channel for brands & their scale enabled brands to achieve the volumes that made the business attractive. The goal of the brand was to support the retailer and stay “in their good graces” by driving potential traffic to the retailer. Here was the basic strategy:A major retailer like Nordstrom.com will place a pre-season order for 1,300 units with a wholesale price of $105.00The Brand sets the Suggested Retail Price at $245.00, while the retailer prices it at $230 representing a 6.1% discountAssume that seasonal mins are 2,500 units - a minimum is the # of units set by the factory that must be purchased by the brand prior to the order being accepted.Here are how the #s breakdown in this example:By virtue of Nordstrom’s scale, their one test order of 1,300 units ($136k) essentially pays for production for the entire season ($135k). However, the real value is in working with Nordstrom over numerous season, when the numbers can look like:In order to illustrate the huge challenges in building an E-Commerce presence for a consumer-fashion brand, take a look at some statistics from VAEL Project.com in Season 4 of the brand.Keep in mind these traffic #s are based on a brand that first hit the marketplace in Jan ‘08 - so these visitors are based on a product in the marketplace with 1000s of promotional blog articles. In my example about Nordstrom’s, we are showing that Nordstrom *could* be generation something like $5.25m in top line revenue. Additionally, if we extrapolate this VAELProject.com E-Commerce out (assume $40k/mo), we are looking at brand direct at about 8% of total revenue.2.4. Emotional Engagement Drives Pricing Power:I wholeheartedly believe that modern brands are evolving into more substantive, direct, and engaging relationships with their consumers to the level of aesthetic & intellectual peers. This transformation has is roots in the Great Recession when the macroeconomic devastation sparked a reevaluation of consumption psychology to and technology opened the door to a new world. Consumers writhing in pain from the market’s ferociously bite after they played by the ‘rules’ of the aughts (purchased a single family home, worked in secure corporate America, and leverage home equity to buy TVs). After the house was foreclosed on, Corporate job lost, and all the debt-fueled toys were taken away - the pervasive American consumption psyche has started a fundamental change as consumers (consciously & subconscious) are shifting their consumption dollars to products & brands that deliver greater value beyond product & with whom consumers identify with as individuals and feel like their business matters to the companies they are supporting.This shift in consumer psychology was enabled by the explosion of the “social web” that collapsed the barriers for consumers to discover about brands & products and learn about who they are as people. The brilliance of the social web is that it enables engagement to be driven by rich, personal, and substantive relationships that support companies & people that you actually like and identify with. From Quora to Gilt Groupe, every transformative startup over the last 5 years has demonstrated that great products require the creation of a meaningful emotional bond between the user/customer & the product/brand that fosters a sense of personality, ethical, & philosophical congruency. This is what we now call ‘emotional engagement’ - where the combination of product, brand, and social experience cultivate a friendship between the people at the brand and the customer.The phenomenal successes of Etsy, Kickstarter, and invested.in demonstrates that consumers will support independents that are less price-sensitive when they know it’s helping the little guy. The most interesting thing is that customers are implicitly beginning to monetize the brand experience & deep emotional engagement of these types of products.

What is this GIG in Fiverr?Except if you've been living in an opening the most recent five years, you've likely known about Fiverr.To the unenlightened, Fiverr is where individuals will do stuff for you for $5.This can be anything – a vintage-style logo configuration, fix site CSS issues, or convert music to 8-cycle style.Consider it an outsourcing stage where as opposed to choosing consultants, you purchase pre-made 'gigs' for $5.The magnificence of Fiverr is the low cost and the gigantic assortment of gigs. Whatever you can think about, there's most likely a gig for it on Fiverr.For bootstrappers like us, the low cost, simple purchasing cycle and assortment of gigs makes Fiverr an especially alluring stage. Rather than testing various consultants, you can simply purchase gigs and complete your work for inexpensively.Obviously, not a wide range of gigs merit purchasing (in any event, for $5). So in this post, we'll reveal to you how to choose the correct gig on Fiverr, and show you our rundown of suggested gigs.What You Will LearnThe Fiverr upsell frameworkThe key to finding an incredible gig on FiverrThe one sort of gig you ought to totally avoid8 worth for-cash gigs that will spare you huge loads of timeOptions in contrast to FiverrWhat Is Fiverr?The thought behind Fiverr is straightforward: purchase singular administrations from consultants for $5 (or possibly from $5).Along these lines, rather than employing a specialist, you are purchasing an assistance the consultant gives. This basically diverts outsourcing from an assistance into an item.For instance, on the off chance that you needed to get an article composed without Fiverr, you'd initially go to an outsourcing stage and set up an advertisement. Specialists would present their recommendations and you'd pick the best among them.On Fiverr, the cycle is turned around. Specialists mention to you what they will offer – an article for instance and you purchase the administration straightforwardly without filtering through recommendations or setting up advertisements.It's incredible on the off chance that you would prefer not to experience the difficulty of setting up advertisements, evaluating various consultants, and finding the correct one. We can't suggest it enough for snappy undertakings that would typically take you hours through the DIY course.There's one more thing you should think about Fiverr, and that is the upsell framework and how they may get more than $5 out of you (Spoiler: I spent up to $200 on a solitary gig once).The Fiverr Upsell SystemAt the point when Fiverr was first presented, it was a straightforward stage where individuals could sell their administrations for $5.After some time, as Fiverr developed, specialists and purchasers began requesting more work and better compensation.To fulfill these needs while as yet keeping up the "$5 for anything" idea, Fiverr presented an upsell framework.It works along these lines:Specialists offer a straightforward assistance for $5 (model: logo plan)Consultants at that point offer extra administrations at greater expenses. For instance, a logo creator may offer quicker conveyance for an extra $5, or sell a heap of online media covers + logos for another $20.Purchasers can purchase simply the basic $5 gig, or they can purchase the $5 gig + gig additional items.It's an extraordinary framework for consultants to get more cash-flow, and for purchasers to improve work from confided in suppliers.That is likewise probably the best illustration of tripwire organization out there. You can enlist anybody for just $5 however there are prompt up deals that definitely increment the exchange esteem.Options in contrast To FiverrA while ago when Fiverr was first dispatched, various organizations duplicated the model and assembled comparable stages for various value focuses ('Tennerr' for $10 gigs, 'Fifteenerr' for $15 gigs, and so forth) The majority of these were fruitless and are currently bankrupt.In any case, various choices keep on flourishing. A portion of these are:gigbucks logogigsta logotask armed force logoHow To Recognize A Great Gig On Fiverr?Likewise with each outsourcing stage, there are a lot of con artists, spammers and inferior quality suppliers on Fiverr.The way to discovering great gigs is to exploit the devices Fiverr offers and to heed your gut feelings.Star Ratings And ReviewsFiverr allows purchasers to audit and rate venders after conveyance. Evaluations are out of 5 and audits are commonly short, one-sentence long.fiverr evaluationsRemember that this isn't Amazon. Principles on Fiverr aren't actually high and individuals will regularly give 5-star evaluations to inferior quality suppliers. All things considered, you can't be too requesting when you're simply paying $5.So take all evaluations and surveys with a spot of salt. On the off chance that it's anything beneath 4.5, you most likely need to avoid it.Additionally focus on the most basic surveys (sort by 'Negative Reviews') as these typically give a more precise image of the most dire outcome imaginable.Work Samplesfiverr gig testDealers can join tests of their work with their gig advertisements. This gives you a thought of the supplier's ability level and quality.Indeed, take these with a touch of salt. Dealers will just remember their best work for their examples, and it may not generally be intelligent of genuine quality.When you take a gander at an example, ask yourself: is this something that will look great on my site? Will it enhance my perusers? Will it make my image look better?On the off chance that the appropriate response is 'No' (and it regularly is), you likely need to look somewhere else.Furthermore, as usual, trust your guts. In the event that it sounds unrealistic, it presumably is. A vender offering top-quality work for $5 is most likely misrepresenting.Remember these focuses and you won't consume yourself with low quality gigs.What NOT To Buy On Fiverr?You're most likely tingling to begin purchasing gigs on Fiverr and spare huge loads of time.In any case, before you can do that, there's something you need to know: not a wide range of gigs merit purchasing on Fiverr.As a rule, whatever speaks to your business' essential worth does not merit moving to Fiverr. This incorporates your site's principle substance and advertising.what NOT to Buy on FiverrWe suggest avoiding the accompanying gigs on Fiverr:Showcasing ServicesIt's a loosely held bit of information in the showcasing network that Fiverr's advertising administrations aren't simply useless, however can even damage your site.This is what you should avoid (and why):Backlinks: Buying backlinks breaks Google TOS – not a generally excellent thought. In addition, for $5, you'll get backlinks from inferior quality PBNs which are useless. Bad for your site's drawn out wellbeing.Visitor Posts: These will be simply inferior quality articles set up on somewhat better PBNs.Public statements: For $5, your public statements are simply going to wind up on malicious news sites. Besides, as Matt Cutts says, joins from public statement destinations don't actually help your SEO.Social Signals: Buying counterfeit supporters/fans doesn't help your SEO. Twitter and Facebook are additionally getting more genuine about battling spam and will probably eliminate your adherents inside the instance of Facebook really, counterfeit fans will hurt your scope in light of the manner in which edge rank works. On the off chance that your fans don't respond to your updates (which phony fans don't), Facebook will quit conveying your updates and your arrive freely be substandard.Traffic: You won't get any fair traffic for $5. It'll either be bot traffic, or bad quality, untargeted guests that won't change over by any stretch of the imagination.Content, Design and ProgrammingOn the off chance that the substance will go up on your fundamental site, Fiverr isn't the best spot to source it. For $5, you're not going to move content that will overwhelm perusers. It will be bad quality, short, and have helpless punctuation and organizing.With respect to plan, while it's alright to get logos or web-based media covers, you should avoid anything complex or time-escalated, (for example, a custom blog plan).The equivalent goes for coding gigs. On the off chance that you need to fix your CSS, Fiverr is an extraordinary stage. Be that as it may, in the event that you need a custom web application, $5 won't get you much.Eventually, be shrewd and pick gigs where $5 really speaks to an important return for the supplier. No author worth his time will put 2 hours into composing a $5 article, nor will a decent architect or coder go through an entire day just to make $5.You get what you pay for.What To Buy On FiverrOn the off chance that you skirt the internet showcasing segment, you'll see that there's huge loads of significant worth on proposal on Fiverr, particularly for imaginative work, for example, logos, representations, and so forth You won't be overwhelmed by the quality, yet for $5, you can get sufficient work to begin.

Absolutely garbage.That is the kindest way I can possibly say it. It is useless both in construction, and in application. It was created by a person that should not have anything to do with the diagnosis of psychopathy, let alone be the defining feature of it. Let’s start with the patron saint of psychopathy, Robert Hare, shall we?He hates psychopaths.Why you might ask? Because people that he thought were psychopaths played him like a fool. Back when he was first interviewing criminals, some of the interviewees figured out that if they told Hare what he wanted to hear, he would literally bring them treats.Well, this is not a hard thing to crack. They’re in prison, they want stuff that makes things more interesting for them, and they have a pathway that makes that possible. Human nature says that pretty much anyone is taking that deal. Hare however wasn’t smart enough to figure that out. He felt betrayed. Apparently criminals are supposed to be nice and not dicks. Go figure he was wrong.So Hare found out that he was being played for a fool and he decided that psychopaths are just awful terrible people that can never ever be trusted. We are all out to ruin the world and steal all its spoils. This was the mindset that he went into his investigation of psychopathy with.So, how did that play out?He found an unoccupied niche that he stepped into at the right time. He also stood on the shoulders of a man that came before him that did the brunt of fleshing out Hare’s vision of psychopathy back in the 1940’s. So, he stole the work, subtracted from it by adding to it a great deal of antisocial traits and criminality, and went forth to copyright the ideas about psychopathy that weren’t his. From there he pushed forward to be the loudest voice in the field of psychopathy research.Not the guy you want being looked to for advice about anything, let alone be the one that writes the checklist for it. Good news however!He didn’t write the list, he stole it.It is almost entirely stolen from a previous checklist that was developed in the 1940s. The original psychopathy checklist was developed by Hervey Cleckley when he was studying psychopathy back in the forties. It was a good list for its time, but Hare changed it only very slightly when he came out with the PCL-R. The problem that this brings about is that a great deal more is understood about psychopathy, yet the list remains stagnant. If this were the case with any other scientific measurement, people would laugh because the premise is absurd. When you have more and better information, you have better tools. Yet with the PCL-R it has gone the opposite direction as some of the things that Hare edited out of the original Cleckley checklist were relevant, and things added in are not necessarily useful.Hm… not cool Hare. It’s got to have some value though, right? Nope. Not even a little as it’s turning out. You can complain about that if you are in forensic research, but if you dare write a paper about it, decrying the failures of the PCL-R, Hare will sue you for defamation.If the PCL-R was treated like a scientific tool it would be open to challenging. Hare would welcome it because proper scientific method is about disproving what you think is accurate, not vehemently defending your ideas when valid criticism arises regarding it.https://pdfs.semanticscholar.org...Fear Review: Critique of Forensic Psychopathy Scale Delayed 3 Years by Threat of LawsuitWell, you can’t do that. Hare was super smart in that lawsuit, and surely put down any and all disagreement with his masterwork then, right? Oh… that would be a big nope once again;“There’s a lot of stuff that looks like it’s junk and should be filtered out by the courts, but it’s not being filtered out,” said Arizona State University psychology professor Tess Neal, the lead author of the study.One controversial psychological test, the Hare Psychopathy Checklist—Revised (PCL–R), came under fire in the American Psychological Association’s journal, Psychology, Public Policy, and Law. In a joint statement first published on-line on January 30, 2020, thirteen expert psychiatrists and psychologists wrote that while the test may have general usefulness in measuring psychopathy “as a construct,” it is “inappropriate [to use] the PCL–R to draw conclusions about an individual’s risk for committing serious violence in high-security custodial facilities.” Such conclusions are often critical in capital sentencing determinations in states such as Texas in which finding that a defendant poses a continuing threat to society is a prerequisite to imposing a death sentence.The experts criticize the PCL–R as plagued by adversarial allegiance — mental health witnesses called by the prosecution will rate a defendant’s level of psychopathy higher than defense experts will during “evaluations of the same person, made around the same time, and even when made on the same information base.” They also say that “the association between PCL–R scores and serious institutional violence is negligible,” making the test unreliable as an indicator of whether a defendant will actually commit violence in prison. The PCL–R “cannot make predictions that an individual will engage in serious institutional violence with any reasonable degree of precision or accuracy,” they say, “and should not be used for this purpose in capital sentencing evaluations.”and;*Finally, the PCL-R has been described by prominent psychopathy investigators as the “gold standard” for the assessment of psychopathy in adulthood (Lynam & Gudonis, 2005, p. 383), and was referred to in the 16th Mental Measurements Yearbook as “the gold standard for the assessment of psychopathy” (Acheson, 2005).*The PCL-R is regarded as the ‘gold standard’ (Wikipedia 2013) in scoring psychopathy. However concerns have been raises against the PCL-R as a method for scoring psychopathy because of it’s divergence from Cleckley’s original construct, as well as concerns of systematic measurement error, research on underpowered sample sizes, and frequent inappropriate application.That’s pretty messy for an apparently unbiased and totally scientific tool, right? But… that doesn’t translate to actual real world consequences, right? If the checklist is so problematic, it’s just used as a minor screening tool, but doesn’t have any major implications, right?After 26 years in prison, he was due for a parole hearing. In California, before a "lifer" like Dixon appears before the parole board, a state psychologist must first evaluate whether he poses a risk of further violence if released. To do that, the psychologist administers a test — the PCL-R, or Psychopathy Checklist-Revised — designed to measure whether that inmate is a psychopath.This test has incredible power in the American criminal justice system. It's used to make decisions such as what kind of sentence a criminal gets and whether an inmate is released on parole. It has even been used to help decide whether someone should be put to death.Ooo, ouch. That’s not great. If you are wondering how this cycle perpetuates, let me educate you;Robert Hare has a copyright on the PCL-R. Not only that, it brings him over thirty thousand dollars in royalties annually. Being the proprietor of the PCL-R also gives Hare the distinguished position of being the recognized expert in psychopathy, and puts him in a unique position to be the gatekeeper of the perception of psychopathy. He capitalizes on this by conducting seminars, also called psychopath-spotting weekends. These not only generate a tremendous amount of income for him, but they also go against the ethics of assigning diagnoses by a layperson to people that they may meet. It flies in the face of professional ethics to be “instructing” people without training that they are in a position to be making these assessments.It is overreaching when it comes to the antisocial part of it. This has been a large bone of contention with researchers. A paper was published regarding this, and Robert Hare sued the researchers to stop the paper claiming defamation of character. It delayed the paper for three years, but it was published in the end.It successfully describes criminals, and it is only used in a prison or forensic hospital. This in and of itself can create confirmation bias and I spoke about that previously. First regarding the landscape that it is used in;Many criminals receive psychiatric evaluations prior to trial.Many clinicians are not actually trained to assess psychopathy but do so anyway.Even Hare admits that this is a crucial failure of the PCL-R. It doesn’t change it’s prevalence of use however. So you have untrained people that think, this person might be a psychopath, administering a checklist that they have no business administering. This causes a multitude of problems.The person might now receive more time on their sentence due to being “diagnosed” a psychopath.This perpetuates the criminal archetype of psychopathyIt makes psychopathy appear more prevalent than it is.It stalls research into actual psychopathyIt drives the myths of psychopathyIt reinforces the “usefulness” of the checklist, thus making it be used more often.This starts the cycle over again.You have a man that is driven by his ego. If you think I am being overly judgemental about Hare, you might want to consider this about him as well;This extends to people that write about him favorably, but not how he prefers. There was a book written about Hare and “his” list written by Jon Ronson called “The Psychopath Test”;The book was written about Hare and his stolen test. That is not addressed in the book, most disappointingly. However, Mr. Ronson writes about Hare with respect. He even seemed to like him. Perhaps this is just his methodology of writing, but he seemed to find him, at the very least, affable. However, what he describes Hare’s behavior to be is very illuminating to Hare as a man.What makes this very interesting is that Ronson seemed to miss all the ways that Hare was an ass to him. He writes about it in a way that doesn’t seem to grasp how absolutely demanding and dick-ish it was. Take the very start—he goes to one of Hare’s “psychopath spotting weekends.” This is a way that Hare rakes in the cash while indoctrinating young people into his cult of personality. Not his personality, but the one he created in his mind for us and now sells at $1238.66 a person for the weekend. Ronson negotiated a discount down to $515.40.This is the first hint at who Hare is. The book is being written to memorialize what he considered his test. Yet, he can’t be bothered to let go of his $500 bucks to let the author in to gather his research. It seems obvious that his priorities are financial.Next, Jon meets Hare in a hotel lobby and has a interaction with the hotel concierge that was unpleasant. He mentions this to Hare, and Hare immediately pronounces the concierge to be a psychopath with some explanation about us wanting to be gatekeepers. That is a power trip. I did actually laugh at this assertion. Hare is supposed to be a trained clinician that KNOWS that you cannot assess psychopathy in a person without there being an extensive workup. Yet, without even speaking to the man, he’s a psychopath. Does this speak to Hare being really, really good at what he does? No. It speaks to a man drunk on his ego. He thinks he can psychically determine psychopathy.Next, he needs a ride to catch a train so he could get to the airport, and of course, he’s in a hurry. Instead of calling a cab, he calls Jon. Seems appropriate.He basically treats Mr. Ronson like a lackey that should be at his beck and call. His behavior in the book to me is very telling. However, it is the behavior after the book that tells the most of all.He trashed it.You can read for yourself his rebuttal to the book that ran Mr. Ronson through hell’s half-acres to write. Not only did he trash it; he wrote ten pages to do so. It’s the last link, but ask yourself: What kind of a person behaves as he did in the book and then trashes it while simultaneously promoting his own? You know my opinion.http://www.psychopathysociety.org/images/hare%20commentary%20on%20ronson%20april%2017%202012.pdfThe PCL-R is worth the paper that a verbal agreement is written on. It should be walked away from and the idea of psychopathy diagnostics should be overhauled entirely. This should be a hard sciences approach instead of one that is looking at a checklist to make diagnosis “easier”. When you are talking about the potential death penalty, the agreement with the state to take someone’s life, you need to have all your ducks in a row. If the PCL-R is a part of that process, not only are they not in a row, they are off playing by the side of the highway without their mother.Just to clarify, the PCL-R is NOT used outside of prisons and forensic hospitals. I see a lot of supposed psychopaths claiming this super high score, 38/40, 40/40/ 35/40, not realizing this is the case. If they scored that high on the PCL-R, it is unlikely that they are getting out of prison anytime soon. They keep that sort locked up, and use the PCL-R to justify it, regardless of whether or not it is reasonable or ethical. You are not going to find a person that is high scoring on the PCL-R just wandering around.There is a PCL checklist for use outside of these very particular institutions, but the scoring is different, and the top of the scale is not as high. There is also one for juveniles, but that is nonsense.It also has a very different scoring system as well. If the top end of the claimed checklist given is 40, the person is claiming the PCL-R. That means that almost certainly they self tested. It could mean that they have the most incompetent psychologist alive, and there is a slim chance that they were actually tested in prison or a forensic hospital. That just circles back to the value of the checklist, so there we go there.Robert Hare has pretty well single handedly created a quagmire in terms of psychopathy through his own dislike and greed. When people try to challenge that narrative they are laughed at. The PCL-R has become synonymous with psychopathy because Hare pushed it to be so. All training surrounding psychopathy in the psychological field are based in Hare’s teachings.The PCL-R is considered the “gold standard” of diagnostics. It proliferates on search engines as more and more clickbait article writers challenge people to see if “Are you or someone you know a psychopath? Take the test!”, and people do. They assume that the PCL-R is a good checklist when it is fatally flawed. People assume those traits mean psychopathy, when in reality they are more indicative of someone that is antisocial.It feeds the media, and the word “psychopath” becomes the defining word for anyone that does something wrong. When something terrible happens, the perpetrator will invariably will be incorrectly labeled as such. It’s a mess, and can largely be traced back to Robert Hare. I would say that Hare hasn’t done much for psychopathy, but a great deal for his wallet and ego. It’s unfortunate, but such is human nature.Athena Walker's answer to How has Robert Hare contributed to confusion or a poor understanding of psychopathy?STUDIES—Junk Psychological Science Continues to Infect Death-Penalty DeterminationsPCL-R: The Gold Standard of PsychopathyCan A Test Really Tell Who's A Psychopath?