Is it possible for a high end manufacturer to overprice their goods?
Having just read the interesting and hyperbole laden review by RH of the new Rockport Orion speakers in the latest issue of The Absolute Sound, one thing struck me..
is it possible in the high end for a manufacturer to overprice their product ( doesn’t have to be a speaker, but this example comes to mind)? I ask this, as the Orion is priced at $133k! Yes,a price that would probably make 99% of hobbyists squirm. Yet, the speaker now joins a number of competitors that are in the $100k realm.
To that, this particular speaker stands just 50.3” tall and is just 14.3” wide…with one 13” woofer, one 7” midrange and a 1.25” beryllium dome ( which these days is nothing special at all…and could potentially lead to the nasties of beryllium bite).
The question is…given this speakers design and parts, which may or may not be SOTA, is it possible that this is just another overpriced product that will not sell, or is it like others, correctly priced for its target market? Thoughts…
"Is is possible?" Sure it is! However, in a free and fair market the market will set the prices- not the seller.
Said another way a thing is worth what someone will pay for it.
There are some who seek the greater fool. Every now and then some bozo wins the lottery, gets an NFL contract, gets a lawsuit settlement, etc. Trying to sell to these types is a recipe for failure. There aren't enough fools with money to sustain a business over time who's building and selling overpriced items.
Interestingly if you sell to the classes you tend to eat with the masses but if you sell to the masses you eat with the classes.
@yesiam_a_pirateYou're missing something huge in your argument. Large manufacturers can scale production and outsource it to China in order to save a lot of money on production costs.
Smaller boutique manufacturers can't do that, unless they dropship or buy off-the-shelf modules and do minimal assembly.
Success in the audio bizz seems to come from marketing, marketing, marketing... The quality of the goods and price seems almost secondary. Just produce something decent and hype it to the max. I'm astounded by the coverage around Schiit and now Gishelli Labs. Everything they release gets hyped up to infinity, as if they're "disrupting the market". They're not. And these brands are relatively new.
@czarivey: not sure what you just said has the slightest connection to anything I posted in my reply to you. Whatever "plan" you have drawn has absolutely zero meaning to me.
It looks like many people here (and other forums) get triggered badly and outraged by the existence of high priced audio equipment. Here is my humble opinion and potential advice:
1) The audio manufacturers are for-profit organizations. Not charities. They will enter a business relationship according to their perception / strategy on how to make a profit, and how to maximize their profit. Basic business decision & marketing strategy.
2) As I have said before, plenty of manufacturers exist in all price points, from very low & affordable, to astronomically high. It is very easy to select the one that fits your budget & income. In the day of internet, finding your "match" is pretty simple.
3) There is a used market available. Here and in other places, including Craigslist locally and thrift stores. That’s an option too, that further keeps costs in check
4) This is a hobby, discretionary spending. It is a "want" not a "need". Music can be heard in extremely cheap devices (i.e. Amazon Alexa, earbuds, etc.), or in the car. There is no need to buy any audio equipment for listening to music. Whatever you decide to buy, take care of necessities first before you buy any audio equipment at any price (i.e. pay the gas bill first).
Success in the audio bizz seems to come from marketing, marketing, marketing... Just produce something decent and hype it to the max.
The marketing gold standard seems to be those companies that not only effectively market a product themselves, but also create such a buzz that the audiophile community carries the torch to the point where promotion of the product in audio forums and by word-of-mouth seems to take on a life of its own. Orange fuse anyone?
Regarding furniture;
Or you can custom order a table, spend thousands and wait months.
The Fleetwood Rack System appears to be an awesome equipment rack that would look great in my room but, as cool as it is, I just can't convince myself to pay $$$$$ for something that probably doesn't function any better than my Sound Anchor stand.
You clearly outlined the way things things are for the prospective customer and I can find nothing to disagree with there.
I think we all would agree that, as you said in your first point:
1) The audio manufacturers are for-profit organizations. Not charities. They will enter a business relationship according to their perception / strategy on how to make a profit, and how to maximize their profit. Basic business decision & marketing strategy.
Fair enough.
However as @mitch2points out, there’s more to it than that.
A lot more.
Specifically, as he says "but also create such a buzz that the audiophile community carries the torch to the point where promotion of the product in audio forums and by word-of-mouth seems to take on a life of its own."
It’s this "flavour of the month" / constant overhyping of 'certain products' that tends to cause a real stink and even occasionally bring the entire industry into disrepute.
Magazines, YouTube channels and forums apparently exist in order for reviewers and enthusiasts to share experiences and knowledge with each other.
This is important, particularly in those cases where we can’t easily get to hear potentially interesting products. Therefore we are forced to rely upon the opinions of others.
However, as we see all too often, these channels of communication can all too easily end up being blatantly misused as vehicles for promotion and advertising hype.
Pushing product.
What we really need is more honesty and this sometimes comes in short supply, at least it has done in my fairly long experience.
Let’s say for example, if the Revel Salon 2s really are the world’s best loudspeakers, then wouldn’t it be better if all other contenders for the throne be directly compared to them?
[Ditto Harbeth M40s, Wilson Alexandria’s, KEF Blades, Martin Logan’s Magico’s etc]
Direct comparisons, I believe, can tell you an awful lot more than any purely isolated review. You could read /watch 1000s of isolated reviews and learn nothing.
However if a reviewer is telling you why they think that a KEF LS50 is better than a Harbeth P3ESR, you’ll have more to go on.
You might also find it easier to sniff out what might be little more than marketing/ PR hype.
What we really need is more honesty and this sometimes comes in short supply, at least it has done in my fairly long experience.
That cannot happen if honesty cannot be checked. You go to the HIGHLY RATED automotive shop and get RIPPED simply for the reason you know nothing about vehicles. Same thing happens with same kind of "honesty" in audio industry. Many of you, as noted MANY times don’t know about that and try to argue.
How do you check honesty? You will need education. Education is set of useful information that had been established by the GROUP of people within the time that is given to a student or anyone desiring to acquire such information.
Education on basic physics, electronics and electro-magnetics can literally OPEN EYES of those surfing here and asking questions why indeed Audio Industry profits are nearly as good or BETTER as drug cartel.
Now I’ll explain the reason why the profits are nearly same:
In case of cartels they take raw supply and bring it to the powder initially with cost of around $100 per kilo and when it gets to consumer it's $100 per gram (hypothetically)
In case of for example Nordost Odin speaker cable, it starts from somwhere $1 per few meters...
in an ideal world, 2 speakers from different brands with similar sound, characteristics, measurements, materials (~+-10%) would be priced similarly. But they aren't.
If you don't burn 100 dollars bills after you sniffed coke with it, do your research. There is an amazing selection out there, be a numbers guy for a day.
In case of cartels they take raw supply and bring it to the powder initially with cost of around $100 per kilo and when it gets to consumer it's $100 per gram (hypothetically)
Thank you for explaining the economics of a drug cartel. I personally have no experience with a drug cartel, so I rely on other people with experience in such matters to learn. See.... education!
In case of for example Nordost Odin speaker cable, it starts from somwhere $1 per few meters...
Your concerns are very valid and well founded. Good observations too. My humble advice on how to (try to) remedy the very valid issue you raised:
1) Lot of noise in the internet. You are right. Coming from "innocent" people with a secret agenda, whether from the manufacturers' side, or themselves profit motif. The key is to get to know the people online or personally that you learn to trust, both integrity wise, and from the perspective of matching their taste with your own. This takes years (if not decades) and constant exposure to what goes on in the hobby, user forums and publications / reviewers.
2) As many personal contact as possible with people. This includes dealers (I fortunately live in a place with several dealers, brick and mortar), friends you can visit in person, preferably who have a vast experience, great systems, and money, and finally, visiting audio shows any chance you can.
3) Most importantly, before purchase, be able to try for yourself, in your home / system. I realize that one would have to start somewhere (i.e. #1 and #2 above), as we cannot possibly try everything out there for ourselves in our homes.
I guess if you go to Barnes and Noble and pick up basics of electronics and electro-magnetics, you will know instead of arguing
As naive as you think I am, I have realized that you have mastered the art of being very offensive to people, without being kicked out of the forums. And that’s skill you have. Thus your 5000+ posts in here (and counting).
Please don't take this the wrong way, and I mean absolutely no offense, a good person will never say jerky (only in a snarky cowardly way) things you post here.
I do have a lot more skills than you and you’ve just realized that while you really can do just absolutely nothing with your unsupported arguments. What else should I do or say??
Everything else is pretty much OK here (and counting).
Funny you should mention that. A lot of good components are getting way over the top expensive. I certainly do not think more expensive = always better.
not only is it "possible" for "high end" manufacturers to overprice, it’s NORMAL...
and hey, if it works to sell stuff, well, so be it: what the market will bear, right?
some people are attracted to stuff ... "luxury" stuff ... exactly because it's priced high -- such folks are into exclusivity of money, moreso than performance.
Interestingly, most self-made American millionaires are not duped by such marketing ploys and do not care about luxury bling, which explains why they're self-made millionaires.
@tomrk+1 "A lot of fun actually, but what struck me is that with few exceptions that price had nothing to do with the quality of the sound coming from the speakers."
what you say has been my experience over 40 years of this audio hobby
@curtdr The question is not whether a marketing plan exists that banks on 'over pricing' gear to sell at the high end, but rather if it is possible that such a plan might ultimately cause buyer ' exhaustion'? Resulting in a major reduction in sales to a final conclusion of zero sales? This would seem to me to be highly probable, since the upward spiral in pricing is getting more aggressive. But, perhaps we have just seen the tip of the iceberg here, who knows?
certainly Rockport has been highly successful selling very high priced speakers for decades, while others not successful... I think their speakers sound incredibly good, though have never had the chance to compare them to similarly priced speakers...not sure how much buyers in that price range care about resale value...
1) Lot of noise in the internet. You are right. Coming from "innocent" people with a secret agenda, whether from the manufacturers' side, or themselves profit motif. The key is to get to know the people online or personally that you learn to trust, both integrity wise, and from the perspective of matching their taste with your own. This takes years (if not decades) and constant exposure to what goes on in the hobby, user forums and publications / reviewers.
You're right, when it comes to opinions in audio, it can take years to find people who you can trust.
The same thing applies to cars, electrics, plumbing, health etc.
I still have fond memories of Derek Whittington who ran Sound Advice from Loughborough. I bought my first system from him and I'll always be grateful for his honesty and patience.
He was big on Linn and Naim, like so many were back then, but neither Derek nor anyone in his shop ever pushed anything on me.
I remember one difficult listening session where I couldn't find a single well reviewed loudspeaker I liked more than what I had already until someone there suggested listening to the Rega Kytes.
That was a classic case of using your own ears to make a purchasing decision.
As you say, trying a product at home would be best but listening at a dealers is still far better than taking a gamble on what you've read or heard.
Howard Popeck is another name that comes to mind. Years ago my sister fancied some new speakers and auditioned some Harbeths at home. She was unimpressed until Howard suggested listening to some vintage JBL L100s which she still loves to this day.
@cd318 Quite a difference between Harbeth's and JBL L100's!! Presumably your sister was primarily into rock, which might explain the preference for JBL's.
@jl35 You ask a good question, how much do consumers in the very high price range for some of this audio gear concern themselves about re-sale value? I suspect little, because most of this gear drops heavily in value once used. There are numerous examples of high $$ speakers that are not easy to sell at 70% of new- once hitting the used market, regardless of age!
OTOH, while this is an interesting point, i am not sure at what price point this relates to my OP, because there are also examples of far less expensive gear that also fails to hold value, and naturally, there are a few examples of gear that has actually risen in value ( although a much much smaller category).Albeit, I can't think of a ultra pricey speaker system that has risen in value.
@cd318 Quite a difference between Harbeth’s and JBL L100’s!! Presumably your sister was primarily into rock, which might explain the preference for JBL’s.
Your presumption is correct.
If I remember correctly from what she told me, Howard demonstrated both the SLH5s and the C7ES3s which she thought were better but neither were to her taste.
Apparently Howard had been into rock himself and was familiar with what the JBLs could do.
It sometimes pays to have a dealer that has a wide range of tastes and experience in music.
Perhaps every good dealer or reviewer should have that?
Rare. Anyone who could remember the 'sound, the qualities' of even most of the various speakers and/or the equipment would be considered to be a savant of sorts....
May not be a good salesman for what you came looking for....just saying... ;)
"Freds' great.....but diapers? On a 35 yr. old....well, whatever....Fred claims to be....today....🙄🤨 "
( Likely to be there all night with Fred as the contrasts/+/-/=/>/</etc. unreels...*L*)
While the news about ARC going into receivership is not really a speaker forum subject, it does possibly connect to this thread.
About a year or so ago, I was at an ARC dealers premier of their new Reference 80s amp. While I was there, the ARC rep was discussing with the attendees some of ARC’s future product line up. It was to include a new flagship model with, if I remember, about 64+ KT150 tubes and slated to be a replacement to the Ref 750SE model. I asked the rep two questions, one was how much heat this beast would give off, and two…how expensive? The rep told me that he didn’t know about the heat, which I thought could be a considerable problem in a hot climate, and that the price was not yet set, but definitely more expensive than the Ref 750 SE! Many attendees said nothing, but the look on their faces said it all.. and it was obvious to all that this new flagship would be a VERY hard sell.
@cd318The honesty debacle is hard to tackle, especially in the high-end market. It is kind of implied that you're over-spending on High-End equipment. That stuff is either overpriced, overhyped, over-engineered with exotic hard-to-find parts, or all of the above. Everyone is trying to re-invent the wheel in the high-end market. Because the wheel is too basic, convenient and affordable. You're swimming with the sharks in a high-end market. The sharks are the salesmen. Furthermore, high-end equipment can be experimental and unreliable at times.
In comparison, the entry-level or midrange feels like a safe ball pit with foam edges. In this environment manufacturers use off-the-shelf parts with tried-and-true methods. There is some trickle-down stuff from the high end. Most of the experimental kinks are addressed.
My position is: avoid the high end at all costs.
This applies to everything: cars, furniture, homes, clothing, watches etc...
@skinzy You can buy the Polk « R » series (Polk R200) on the Walmart website. But it’s from a third party vendor. That speaker is seriously good. And I know you’re joking but I’m pretty serious.
In hindsight I am going against the Audiogon lifestyle of taking the HiFi hobby to the next level. Whatever that means. But it certainly doesn’t imply buying reasonably priced and unexpectedly good mass-produced entry level speakers. I suppose that you guys value exotic components, craftsmanship and brand heritage more than others.
I suppose that I am providing a baseline for all speaker evaluations. If a high end setup doesn’t outshine a humble Polk R200 powered by a humble Denon amp then it may as well be overpriced junk and you should feel bad about yourself LOL.
This leads to another thought: high end stuff seems to be reviewed in isolation and compared to other high end stuff. It is implied that the high end is far superior than the entry-level. But once in a blue moon you can become annoyed by the unexpected performance of modern entry-level gear if you own high end stuff. It’s all relative of course. And craftsmanship plays a huge part in the price, less so in the performance.
Last point: I envy the people who just spend less than two thousand on a Hi-Fi setup and are completely happy. Just look at the people on the internet who spend tens of thousands on Hi-Fi and are never happy. The simplicity of spending $1.5k on a full system at Walmart is alluring.
@kokakolia While my thread was asking about the very top end pricing in audio, I am interested in your points about the area below high end...commonly called mid-fi, or even mass produced low end gear. I think today, unlike in years past, there are some quite good low priced components that do give one a ’taste’ of what high end can accomplish, ( which is what i think you are pointing out). However, while this is encouraging for folk who cannot budget for what is now becoming very serious $$ for a lot of this gear, the reality of the situation is...and I hate to say this, that one typically does get what one pays for in this hobby in SQ ( in most instances). IF..again IF, you have a chance to listen to what some of this gear can sound like, particularly when set up properly in a proper dedicated acoustic space, I feel certain that you will hear what it is that the top high end companies provide from a SQ perspective. Now my question of whether the $$ asked can be raised to such a point that even the most well-heeled audiophile says...sorry, too expensive and I pass regardless of the ability, still applies.
I’ll conclude that the very high end is bogus. The prices are astronomical to inflate the perceived value. You can cite extreme examples with 1 million dollar speakers. Maybe you should define high end in terms of performance. I believe that you can achieve that for tens of thousands of dollars if you’re smart. The very best Yamaha system is « only » $50k. You get all of the electronics (amp, preamp, cd player, turntable, full range speakers). Perhaps I am moving goal posts. I trust Yamaha more than a small boutique manufacturer selling $300k speakers and might go out of business soon.
So yeah, a step below the very high end could be the sweet spot. Going entry level was never your intention.
Anyone who could remember the 'sound, the qualities' of even most of the various speakers and/or the equipment would be considered to be a savant of sorts....
I guess not, but at the least you should be aware of the strengths of various loudspeakers etc.
In that particular example Howard Popeck was familiar with both the Harbeths and the JBLs. I probably wouldn't pick the JBL L100 if I listened to mainly classical, they're good but there's probably better out there.
However for rock they're amongst the best speakers I've ever heard. It's hard to describe just why but they do have amazing transients and dynamics plus clean mids. They also have good bass but it's not the kind that's artificially boosted and then suddenly falls off a cliff.
Every dealer and reviewer should be familiar with a speaker like that just in case a listener strongly favours one particular genre over others.
As for modern equivalents, I've never heard any of the Zu speakers but I'd expect them to be also extremely good with rock. Maybe PMC too as both Sean Casey and Peter Thomas look as if they might enjoy some hard rock now and then.
That stuff is either overpriced, overhyped, over-engineered with exotic hard-to-find parts, or all of the above. Everyone is trying to re-invent the wheel in the high-end market. Because the wheel is too basic, convenient and affordable. You're swimming with the sharks in a high-end market. The sharks are the salesmen. Furthermore, high-end equipment can be experimental and unreliable at times.
Good argument, one that applies across the board.
I remember seeing one of the earliest large screen LCD TVs at a show in London when they were first coming out.
This one had a mediocre picture at best and cost £29,000!
We were told that Buckingham Palace had ordered one.
Who'd have thought the Queen would be at the cutting edge when it came to TVs?
Or perhaps it was the Queen mum, she was said to have enjoyed her horse racing on TV.
There's almost always a risk attached to cutting edge technology as well as a hefty premium to pay.
@cd318...*S* I can agree with that sentiment; any and all salespersons should have a breath of experience with some 'classics' as well as the new & any offerings at hand....but that's a tall order, since (I'd suspect) most that can fill that muse are pending on my age and/or have gone onto the Great Auditoriums In The Sky... ;)
I liked the L1hun....out of my $zone at the time, and the grille would be a tease even my cat, well behaved as Grace was, would have sorely been tempted by...
As to what I had at the time? I suspect my 901s', in a small studio apartment that I opted to show restraint with regards to my neighbors...and the aged window panes...*g*
I would agree that rock does seem to hold a certain challenge to many high end speakers, regardless of the price. Most of the time, I don’t hear it played back well on speakers that are great for jazz or classical. Question becomes as to whether there is truly a certain type of speaker that does all things best…including music like RAP?
The JBL’s mentioned would be preferable to a lot of speakers for rock,at and above their price range, but for other types of music and specifically something that requires an intimate presentation, not so much.
Can speakers that are great at dynamics and drive also excel at detail and nuance?
That's an interesting question and one which even after some 30 years of experience in Hi-Fi, I'm not too sure of the answer.
I've certainly heard some very expensive speakers (£50k+) that definitely couldn't do both. They tended to be exotic designs where the designer wanted them to do certain things as best as they could even if it meant doing others far less well.
So, for some like-minded people they still might be reasonable value for money but for others they would be stupidly overpriced.
@mitch2 An excellent question. I think it is possible that a speaker can do great dynamics and drive and, when called upon, can also excel at detail and nuance. I recently listened to a new pair of Wilson Alexx V’s, that seemed to fit that bill, albeit at a price.
Can speakers that are great at dynamics and drive also excel at detail and nuance?
Why wouldn't they? Or is it that when excelling at "dynamics and drive," certainly among a range of speakers that fare well here, there are aspects of the reproduction, such like detail and nuance, that would seem less prominent in the face of prowess in other areas? Honestly I've never really felt detail and nuance to be lacking in speakers that excelled at dynamics, at least not as a general observation, but that there's instead a typical shift in the distribution of the presentation as a whole; with dynamically capable speakers, larger horn-loaded iterations in particular, the overall sonic imprinting veers towards that of a higher "density" of reproduction overall, with - in many cases - a more outspoken richness or energy in the "power region" (i.e.: ~150-400Hz) in addition to a fuller and more physical reproduction from the central mids on up. Conversely quite a few if not most direct radiating and lower eff. speakers sound leaner (i.e.: less meat on the bones) by comparison, which subjectively tends to heighten the sensation of detail and "airiness." There's also a higher ratio of direct sound vs. reflected ditto sound from larger horns, that may lead to a less "reverberative" presentation and only add to the sensation of a "thicker" and more robust sound.
@patrickwilison Clearly 'overpriced' is a relative term. But, I think we are not so much taking about an 'overpriced' item here, as one that is so costly that even the most well heeled a'phile will balk at the price...
Therefore, my OP was questioning whether the price asked by a high end manufacturer can actually ever be too high for them to sell any of the product that is touted as 'SOTA'??
Folks, if we look at the pricing points in high end, it seems if we take speakers as an example, the low price points for high end speakers seem to hover around $500 to $1000 ( Maggies, some Polks etc.,) and the ceiling seems to be around $1M or so, ( for Wilson Wamm's and a few others). At the ceiling point, we do not see speakers that are priced in the multi millions. ( $2M or more), yet! But, i wonder why, do these very same manufacturer's know what the threshold is to their maximum attainable price...or is it something else?
the average (audiophile) low end is $400 and the high end is 60K, based on ~70 brands. There are less than a few well known brands who make speakers for over a 100K. I would call them luxury priced, not overpriced
I think overpricing is more common in the jump from mid-fi to hi-fi, when the differences are not substantial but the price jump is
Possibly the super priced speakers you refer to are all totally "custom" and not in a retail catalog...and clearly many $100,000+ speakers sell well and others do not...seems to have worked quite well for Rockport and Wilson over decades of sales...not so good for some others
I imagine some audio manufacturers having an internal discussion--
"We can make it for $200, sell it for $500 and sell lots."
"But, if we sell it for $500, no one will take it seriously as truly ’high end.’ Let’s price it at $5000 and call it our Statement product. Then we’ll sell even more."
@hoodjemI was about to say something similar. Let's face it, the absolute high end doesn't sell many products. Expect a handful of sales every year.
I truly believe that buyers are clueless and rely on emotion and gut feeling when buying expensive audio equipment. Let me put it this way: in a room full of $100k speakers, the $50k speaker will seem inferior based on price and expected value alone (even if it performs better).
So manufacturers may by nudging buyers into spending more money that way. Just create a very extensive, overly complicated line of speakers. Make the prices exponential. This is really a car salesman tactic. You expect to spend $20k on a car, you walk out of the dealer with a $35k vehicle because it was on sale and because most other cars in the showroom were around $50k. Your brain accepts higher prices because you perceive higher prices at the dealership. This applies to eveything: furniture, mattresses, kitchens, bikes etc...
It's not unreasonable to assume that flagship products drive up the prices for lower-tiered products by association. In other words, drive up the averages.
@kokakoliaI have been looking at prices for 3 weeks now, 100s of speakers (243 and counting), and I don’t see it. Sure there are outliers but for the most part, these companies’ managers aren’t driving Teslas. There is great value at 3K and even better value at 10 and there may be of course, a bigger markup over 20K but way fewer buyers too. The competition is immense that keeps prices in check.
@grislybutter Agreed. There are many bookshelf speakers from boutique brands under 3000€. But we're getting off-topic. Immense competition is obviously good. But it's hard to get your brand out there. US brands have a huge priority above Euro brands.
I don't know, I would be hesitant to purchase high-end speakers from Wilson Audio, Sonus Faber or Focal. They're obviously putting a lot of their budget into bribing the press and marketing.
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