When I was in the retail jewelry business, margins percentagewise were greater on the cheaper items, with markups as little as 5% on the higher ones - and this was paying mall rents. When gold doubled in price, existing jewelry was suddenly worth more and we charged more as consumers foolishly wanted gold jewelry more at the higher prices than when they (and raw gold prices) were cheaper.
The point that’s never made when discussing prices is simply that manufacturers and retailers charge what their market will pay. Otherwise, they will either go out of business or have to cut their prices (or both). Big box retailers price their products based upon price sensitivity - in a grocery store, milk, bread, eggs and bananas are have much lower markups than the rest of the store as people determine affordability by those items and shun stores they perceive to be high.
Years ago, Mark Levinson’s original company’s products were held by many, including Stereophile, as the top of the then available consumer level equipment and now, even used, are still going for more than an average consumer would pay. Since demand still exceeds supply, prices stay relatively high, even for decades old items. How many of these $100k speakers or amplifiers will hold that value?
Why Is Hi Fi Gear So Darn Expensive?
Why Is Hi-Fi Gear So Darn Expensive?! - The Absolute Sound
Interesting read.
"I recently heard a small 2-way stand mount speaker at a show. The sound was excellent. The product was priced at $50,000 or thereabouts, per pair. Allowing for distribution and marketing leaves about $25,000."
$25000 for distribution and marketing? Really? That much more for this than a similar product at 1/10th the cost?
I don’t doubt the marketing cost per unit could be much higher with boutique products. Makes sense. Is the cat is out of the bag regarding the value proposition of boutique products?
How about fancy fuses marketed for free here that cost practically nothing to ship? Oh my!
I guess there are "excellent" expensive boutique products and others that offer value everywhere. Hifi not unique. Take your pick! Live and learn!
The article also chalks up people’s reactions to high-fi prices to emotion. What about the sound they hear? Real or emotionally distorted? What would Mr. Spock think about that? I know he likes music...he plays a harp!