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In Reply to: Linn aiming for high end posted by smart845 on April 25, 2007 at 11:16:29:
... against trends in the market that they appear to be ignoring...Without getting into the "High-End Audio is dying" debate, it would be worth their while to take a step back and analyse just where the market is likely to go over the next 2,4,6,8,10 years and than re-evaluate their strategy.
One can look back 2,4,6,8 years and detect a number of trends in the patterns of spending in the area of home entertainment and the impact of "new entrants" into the buyer community as youths become young adults.
Looking beyond the "symptoms" of the shifts in buying patterns and getting down to the "drivers" that motivate buyers and, as a result, what they look for - and then doing so retrospectively to understand the "why" of the shifts over the last 6-8 years and then to try to look into the future at the next 4 or 5 waves of newer entrants and what their "drivers" will be, is a complex set of tasks - but an essential one if the "right strategy" is to be selected.
I have no concrete evidence to support this, but - from participation in a number of audio forums - it appears that in the area of pure 2-channel audio, the average age of active afficionados is increasing as time goes by and fewer new young entrants join the party.
Also, from discussions with various dealers, we've already seen 2-channel lose ground to multi-channel (both in music and video applications), and - right now - we're seeing both 2-channel and multi-channel losing ground to newer "vehicles" that provide a combination of convenience, portability, accessibility, and lower cost.
This last "recipe" comprises a mixture - portable solid-state storage of music/videos and on-line access to programme material that is also more conveniently acquired via downloading.
Just where this is going to go over the next few years is the question that needs to be answered.
As I mentioned earlier, this is not intended as another "prophecy of doom" for 2-channel audio, just an analysis of the shifts that have, are and will take place in the apportionment of discretionary spening in the area of home entertainment - and the prognosis for pure 2-channel audio is that it's "share of the pie" will, in effect, shrink as explosive growth other areas sees more and more of the same pie being spent on other more "relevant" technologies that address the constantly shifting needs of an evolving market.
My personal view is that any strategy that is based on a dwindling target market will eventually implode - although narrowing the focus can provide a temporary "stay-of-execution".
"Linn-Watching" could become an interesting side-line... :-)
DevillEars
Follow Ups:
... sales are down and they don't know how to improve them.
They have thought about cheaper products but directors' salaries are so high they cannot reduce costs.
By sacking most of the staff they can continue to make the same old products until such time as the directors take golden parachutes and the company goes belly up.
Of course I could be wrong.
I think you are right. I think trimming prices, bumping the marketing a bit, and trimming down the fat at the top is actually what would keep them going strong. I just checked out their site and found interesting things I was previously unaware of.I like the Genki CDP but the Rega Apollo is as good if not better for less money. Had they been the same price, it would be a tough call. I have never heard a Unidisk from them so I have no opinion on those.
... and just what they do in terms of media, distribution and in protecting intellectual rights.When CD was introduced, music distributors - both wholesale and retail - rapidly removed vinyl as an alternative, in an attempt to force a migration. This proved to have been a "lesson well-learnt" and I don't believe the public will fall for a similar tactic again.
This time around, any shift is more likely to be driven by the market than by the suppliers - and any suppliers (of either music or the means to replay it) that don't follow the market shifts, won't survive.
The one "trump card" the suppliers do still have is "technology" and, when driven by commoditisation, decreasing costs. Solid state memory costs per storage unit are dropping at a phenomenal rate - although, to be fair, one is not being offered "the same for less", but rather "more for the same" - consider memory cards for digital cameras.
The underpinning issue here is that the dynamics of the home entertainment market are exceedingly complex and any oversimplification is dangerous...
DevillEars
do they want to grow or scale back and refocus to higher end products? they CAN'T HAVE BOTH!there aren't enough sales to warrant going higher-end than they already are. unless, they just want to half the company, mnake really high end gear to make more profit off every piece sold.
if they truly want to grow as a company, i think the better strategy would be to go the martin-logan, vienna acoustics, etc. route. get your shit into magnolia audio/video and other larger retailers. sell down-market to the more mid-fi crew, while still having your star products for the hi-fi market.
seems to be working for martin logan. they have their lower level line (possibly made just for this purpose) at magnolia and still have the uber-high end at audio salons.
what do you guys think? if you can't beat 'em, join 'em. Linn has more than enough brand recognition to the point where as long as they still make decent products, even at lower price points, they will sell very well. just on name alone.
look at fashion companies. Coach and Dooney and Burke sell WAY down the ladder these days. even on HSN and QVC, yet their brands still have a solid pull for consumers. they successfully ride the fine line between going downmarket and trashing the brand (think given, Christian Dior in the 80's, etc.)
It was their attempt to get into the world of mid-fi wasn't it? It's more or less the market I would be in if I was buying, and I did think about buying one at one point but my current set-up isn't 30 years old yet.
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