# Difference between Luxury/Premium/Value fashion segments? What does "value" mean here?

I do not understand the following graph shown:

What does "value" segment mean? Someone please kindly provide the difference and explanation. Thank you.

• In your chart you would usually expect those to be price categories in order: high at the top and low at the bottom Apr 2 '20 at 22:51

Consider the ratio $$\dfrac{\text{Benefit}}{\text{Price}}.$$ This is not the same thing as your net benefit, $$\text{Benefit}-\text{Price}$$. So a good that might give you a high net benefit might have a low benefit-to-price ratio. For example, $$100-50=50$$ and $$100/50=2$$ versus $$1000-900 = 100$$ and $$1000/900=1.1111...$$.

Luxury goods have high gross benefit but low benefit-to-price ratio and possibly a low net benefit. Affordable luxury is trying to improve on benefit-to-price ratio and net benefit while still having a high gross benefit.

Value goods are trying to achieve a high benefit-to-price ratio, despite the products having a low gross benefit and a mediocre net benefit. So you feel like you got a lot for what you paid, even if it's a $$\$$20 acrylic sweater instead of a $$\$$500 cashmere one.