Payless pulled off a stunt selling their $20 dollar shoes at a giant markup under a fake luxury brand they called “Palessi”. Just how did they pull it off, and what does it teach us about consumer behavior?
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Palessi
How much would you spend for a pair of high-end shoes? No matter who we are, what we wear is a statement of who we are, no matter whether we care about it or not. Some people are willing to pay hundreds of dollars trying to signal to other people who they are.
Payless Origins
Payless is an international discount footwear chain founded back in 1956 by cousins, Louis and Shaol Pozez. It was actually a business built on the idea that shoe salesmen weren’t entirely necessary. Its first store was established in Topeka, Kansas, when it was known as Pay-Less National.
21st Century
Fast forward to when Payless entered hard times at the turn of the century. While they rapidly grew and went global, Payless had competition from other retailers such as Target and Walmart.
Palessi
And that’s exactly what they did. Payless opened a fake luxury store called Palessi. Their stunt was able to successfully convince influencers into buying rebranded Payless shoes for $600 dollars! The shoes normally sold in Payless stores for a mere $20 dollars.
Perceived Value
The Paylessi marketing stunt showed one important psychological trait that’s a part of human nature. The only value for any given item is its perceived value, and never the actual value.
Marketing Success
Sarah Couch, Payless’s chief marketing officer at that time, believed that the campaign would be a great way to get a lot of people to consider shopping at Payless again. The campaign turned out to be a huge marketing success.
Payless Today
While luxury branding and retailing experts praised the campaign’s social media-worthiness, Philip Graves believed that the advertising campaign would only have some short-term benefits for Payless. And he was right.