New research shows that even in a cost-of-living crunch, shoppers will accept price increases from some brands in some categories. But, argues Annie Brown, Managing Director UK of Brand Finance, which conducted the analysis, there can also be good reasons why valued brands choose not to charge higher prices.
With the UK's 250 most valuable brands growing 12% to a total of £448.9 billion as at January 1 2026 (source: UK 250 2026, Brand Finance) – a rate of growth comfortably outpacing the 1.3% increase in UK GDP last year – our latest research explores a simple question: where are UK consumers still willing to pay a premium?
After several years of squeezed household budgets, the answer varies sharply by sector. Comparing willingness to pay with measures of brand strength shows that while strong brands consistently earn consumer preference, they do not all monetise that strength in the same way.
Brand Finance's research captures this through its Price Acceptance measure, which reflects consumers' perceptions of a brand's value for money across a range of price positions. This provides a practical measure of a brand's ability to sustain premium pricing.
Viewed alongside Brand Finance's Brand Strength Index, it also illustrates an important distinction: while stronger brands generally enjoy greater pricing permission, not every strong brand chooses to compete through premium positioning. Some instead use their brand equity to deliver a compelling value proposition rather than charge higher prices.
According to our data, the relationship between willingness to pay and commercial performance is most pronounced in four competitive categories: hotels, airlines, apparel and restaurants. In each, the brands consumers are most willing to pay more for also tend to deliver the strongest margins.
Where premium positioning pays
The pattern is clearest in the hotel sector. Our data finds that around 47% of consumers say InterContinental is expensive but worth it, and 43% say the same of Crowne Plaza. Both brands sit within IHG, whose operating margin is roughly 48%, illustrating how strong premium positioning can translate into profitability.
Premier Inn competes on value: fewer than one in ten rate it "worth it" in premium terms, and it runs a margin closer to 22%. Interestingly, Premier Inn notes a higher brand strength score than Crowne Plaza (85.0 vs. 56.1), yet it is the value player of the two – its brand strength is expressed through a value-for-money proposition rather than premium pricing.
Brand strength and willingness to pay are closely related, but not synonymous. Strong brands can monetise their equity through premium pricing or through delivering outstanding value.
Airlines tell the same story across the full service and budget divide. British Airways (47% "worth it") and Virgin Atlantic (43%) command genuine willingness to pay, and BA's margin, at around 14.5%, sits well above the sector average of 9%.
The budget carriers occupy the opposite end: easyJet and Jet2 score in single digits on premium perception and run margins of 6–7%. Where the physical product – getting passengers from A to B – is broadly similar, the premium is a function of brand, not aircraft.
The apparel category shows that willingness to pay is not simply a matter of being expensive. The retailer Next earns real premium permission (around 29% "worth it") and a margin of 18%, more than double the sector average of 7%. ASOS sits at the other end, with premium perception in the low teens, a weaker brand (rated BBB) and a margin in negative territory.
Burberry is the cautionary tale: 38% of consumers call it worth it, but almost as many – 33% – say it is too expensive for what you get, and that resistance shows up in a margin of barely 0.3%. Aspirational pricing only pays when consumers believe the premium is justified, not merely desirable.
Restaurants complete the picture and offer the sharpest illustration of strength versus premium. Costa Coffee (34% "worth it") and Greene King (18%) turn premium perception into margins of 31% and 23%. Greggs and Wetherspoons, both built squarely on value, score low on premium permission and run margins below 10% – even though Greggs is the seventh-strongest brand in the entire UK 250.
Strength earns a brand the right to charge more, but it does not oblige it to. Rather, brands position themselves according to both their competitive environment and strategic choice. Greggs demonstrates that a strong brand does not need to pursue premium pricing to succeed commercially. Its value-led positioning has delivered sustained growth, with revenue increasing at a compound annual rate of 12% since 2022.
Why these categories – and why now?
The common thread is competition and differentiation. In sectors like hotels, airlines, apparel and restaurants, the core product or service is often functionally similar, making brand differentiation a critical lever in justifying higher prices. With switching costs also relatively low, consumers can move easily between providers, making strong brand positioning even more important. By contrast, in more functional or regulated categories, pricing is often constrained by competition, regulation or consumer expectations, leaving less room for brands to translate their equity into a premium.
This is not a universal law, and it would be wrong to claim otherwise: in categories where cost structures, scale or input prices dominate, the relationship between premium perception and margin is far weaker and sometimes runs the other way. Yet in differentiated consumer sectors, where the brand itself is the product's main point of difference, the pattern is consistent and commercially significant.
Economic uncertainty has made these differences more visible. Consumers haven't stopped paying premiums altogether; they've become much more selective about which premiums they're prepared to pay. Brands that clearly justify a higher price continue to command one, while those without a clear point of difference are more likely to be drawn into discounting. Rather than eliminating premium pricing, today's environment has made consumers more discerning about where they believe it's deserved.
There is a clear implication for brands here. Building brand strength remains fundamental, but the commercial return on that investment depends on how it is expressed within each category. Some brands convert their equity into premium pricing; others deliberately translate it into superior value.
Understanding where consumers are willing to pay more – and where they are not – is therefore as important as understanding how strong a brand is in the first place.
In today's more cautious consumer environment, willingness to pay a premium is one of the clearest demonstrations of brand equity translating into commercial value.
UK 250 2026 is the latest in Brand Finance's annual reports into the most valuable and strongest British brands. To put a valuation on brands, Brand Finance uses the Royalty Relief method, which estimates the future revenues attributable to the brand, applies a hypothetical royalty rate that a company would pay to license the brand from a third party, and discounts those future royalty savings back to a present value.
The opinions expressed here are those of the authors and were submitted in accordance with the IPA terms and conditions regarding the uploading and contribution of content to the IPA newsletters, IPA website, or other IPA media, and should not be interpreted as representing the opinion of the IPA.
Last updated 08 July 2026