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What is the Snob Effect?

 , updated on April 26, 2023
The snob effect is the tendency for a brand to lose its identity and status as it expands its market share. The term is most often associated with wealthy individuals dropping a brand when aggressive discounting occurs. The snob effect can also apply to subcultures who drop a brand when it becomes mainstream culture.
Luxury brands that endure for decades or centuries carefully manage their brand to avoid promotional discounting or low-end products that may trigger the snob effect. The temptation is great to discount as a high status brand can often boost sales dramatically by decreasing their price. This sales boost is typically short-lived as the status of the brand may quickly go into decline.
The snob effect isn't always driven by actual snobbery. Luxury goods are sold on the premise that they are rare, unique and special. When they are clearly mass produced at scale, customers may feel that they are no longer a good value at full price. For example, a customer who pays a high price for shoes and later sees them discounted by a large factor may feel cheated.
Overview: Snob Effect
TypePricing
Branding
Marketing
Marketing Economics
Definition (1)The tendency for a product or brand to lose its status as it expands its market share.
Related ConceptsScarcity Marketing
Price Discrimination
Price Strategy
Product Strategy
Brand Theory

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Pricing Strategy

An overview of common pricing strategies.

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A list of price discrimination strategies.

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An overview of price wars.

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A list of price economics principles and theories.

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A definition of premium pricing with examples.

Penetration Pricing

A definition of penetration pricing with examples.

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