Kenan Arifoğlu

Who they are

This page records the public professional record only. Nothing adverse is recorded and no motive is attributed.

Marketing Science listed him in 2020 as an assistant professor of operations and technology at the UCL School of Management. His wider record was not surveyed for this page. His co-authors are Sarang Deo of the Indian School of Business and Seyed Iravani of Northwestern University, as the same listing gives them.

Key papers

• Arifoğlu, K., Deo, S., & Iravani, S. M. R. (2020). 'Markdowns in Seasonal Conspicuous Goods.' Marketing Science, 39(5), 1016-1029. doi:10.1287/mksc.2020.1223

Key ideas

The paper asks why luxury retailers use markdowns even though markdowns can undermine exclusivity. It names three effects: the snob effect, in which a markdown can lower willingness to pay among buyers who want to feel unique; the strategic effect, in which forward-looking shoppers wait for lower prices; and the sales effect, in which a markdown can raise demand for a seasonal product.

In the model, when buyers strongly value exclusivity the retailer may deliberately sell fewer units than demand, a buying frenzy that raises willingness to pay. Stronger exclusivity seeking can push the retailer towards markdowns rather than a single price.

It is a mathematical model and reports no data. The concept page Exclusivity Seeking carries the detail. The paper was read here at the level of a repository abstract and a summary.

What the paper asks

The 2020 paper starts from a puzzle that anyone watching luxury retail will recognise. Luxury retailers mark down seasonal goods even though a markdown can undermine the exclusivity buyers pay for. The authors ask why, using a game-theoretic model in which strategic buyers differ in how they value the good, want exclusivity and can wait for a lower price.

Their answer is a reason, not a verdict. The model shows a setting in which a retailer is better off marking down than charging one price, and in which stronger exclusivity seeking is part of why. Co-authors Sarang Deo and Seyed Iravani appear on the paper as the same listing gives them.

How the paper is used on this site

The article Why Luxury Brands Hold Their Prices uses it as the counter-case. The rest of the evidence in the article points towards holding prices. This paper shows that the theory of exclusivity does not by itself forbid a markdown, and that a house which rations first and marks down later is not contradicting its own logic.

It is the only item in the article's table that models a luxury retailer directly, and it is also one of two with no data, since the other is the 1899 theory of taste. The article marks both as stand-ins for the study it could not find.

What the paper does not show

The paper does not report that any luxury house behaves this way, or that the pattern earns more than a single price. It concerns seasonal goods, and the result may not carry to goods that stay in a range for years. Its authors add that ignoring strategic buyer behaviour can be costly, which is a warning to retailers who assume their customers will not wait.

The page's own limits are the same as the paper's: a model is a statement of what follows from assumptions, and the assumptions are the part to test.

How it was read

The paper was read here at the level of a repository abstract from the ISB and UCL repositories and a summary. The published text was not seen. His affiliation is the one Marketing Science's listing gives, nothing adverse is recorded, and no motive is attributed.

---