[Magic77]

I'm no business man, but; does anyone think if a company such as Grado Labs were to mass market their headphones that they could reduce the prices of their headphone line by 50%? For example; the SR60 goes for only $69 now, but if they were sold at major retail stores around the country they could sell them for only $29.99 and sell 10 times the amount of headphones. Your average consumer probably never heard of Grado. But, again, I'm not a business man, so I don't know what the business end of all that would be. Just wondering if anyone else would know more or have a comment.

 

[lini]

Magic77: That could be. On the other hand, though, it could be very difficult for them: Mass marketing means you also have to have mass production capacity behind - not being able to ship would be deadly (1st risk). For mass production you need approriate facilities - if you don't have them, you have to build them up. So you probably have to get some serious credit from your bank (2nd risk, because you'd better be successful, now). And you'd probably need more employees - a kind of social 3rd risk, because you'd have to fire them if you're not successful in conquering the mass market. The 4th risk is that you're much more dependant from the demand of the mass market, which is - in addition - probably more difficult to foresee: If the customers' taste changes unexpectedly, you have a lot of products to recycle... So for a company that already has good success in the special interest market, going mass market might not be such a good idea at all.

Greetings from Munich!

Manfred / lini

 

[mbriant]

lini's points are all correct. The established mass marketers like Sony for instance have an immense advantage because they have a wide array of products besides headphones to justify the marketing/distribution infrastructure needed to supply product in mass quantity. For instance, they can spend millions of dollars to advertise the name SONY which covers everything from headphones, to car stereo, to television, to telephones....whereas a small company like Grado, would have to spend all that money just to sell headphones. Same thing with their sales/marketing force. Sony can afford a thousand sales reps because their product line is so broad. A company like Grado would be hard pressed to do so, if all they sold were headphones and cartridges.

Also, it's highly unlikely anything near a 50% price reduction could be obtained simply by buying/building in larger volumes. (economy of scale) Some, if not most of that reduction would have to come from profit margains. It becomes a marketer's decision whether it's worth it to make the same amount of profit selling 3 pairs of low priced headphones as it is selling one pair of high price headphones.

In the 50's, 60's, and 70's, the Luxman brand of home audio components earned their place as an innovative, high end, high quality manufacturer selling in small volume through limited distribution channels.

In the mid 80's, Alpine car audio had cornered the mass car audio market, made huge profits, and had huge capital reserves. They decided to buy out Luxman and capitalize on it's good name by mass marketing it as well. Suddenly there were $250 Luxman receivers on the market. Even the incredibly successfull Alpine underestimated the difficulty in supplying mass home audio products and within only a couple of years...completely gave up on Luxman.

I understand that Luxman is back again and have returned to their high end beginnings.

 

[Magic77]

Thanks for the responses. You both made some excellent points about the business end of it all. I guess that Grado is successful in the way they do their business and has gained a very great reputation for the way they choose to go about it. Some people trust the small companies more, and then there are a lot of people who will only buy products from the big companies like SONY, Panasonic, RCA.....etc. I think the people in these forums tend to lean towards both sides. For example; some people will match Sony CD players with Grado headphones or Headroom amps. I guess it's personal preference.

Take Monster Cable. I beleive that the man that owns Monster Cable is very wealhty, but he may have already been quite wealthy before he started Monster Cable, thus the mass marketed products from Monster Cable, and that's not saying that their products are better or worse than other cable manufacturers.

 

[Eagle_Driver]

Quote:

Originally posted by Magic77 ...I guess that Grado is successful in the way they do their business and has gained a very great reputation for the way they choose to go about it. Some people trust the small companies more, and then there are a lot of people who will only buy products from the big companies like SONY, Panasonic, RCA.....etc. I think the people in these forums tend to lean towards both sides. For example; some people will match Sony CD players with Grado headphones or Headroom amps... ...I beleive that the man that owns Monster Cable is very wealhty, but he may have already been quite wealthy before he started Monster Cable, thus the mass marketed products from Monster Cable, and that's not saying that their products are better or worse than other cable manufacturers.

I totally agree with the first paragraph. There are many people - myself included - who will match Sony or Panasonic portable CD players with Grado, Sennheiser or Etymotic headphones and Headroom or Creek amps!

As for Monster cable, the pricey mass-marketed versions of Monster Cable are IMHO as mediocre as most cables and interconnects on the market.

 

[lini]

mbriant: Luxman is back? That's good news. Do you remember their tape decks? Wow! I wonder what happened to Sansui, though - another Japanese manufacturer, that has disappeared a few years ago. They used to have some good mid-fi amps...

Greetings from Munich!

Manfred / lini

P.S.: And did you ever see Tandberg's hi-fi stuff? Massive!

 

[mbriant]

quote:

"There are many people - myself included - who will match Sony or Panasonic portable CD players with Grado, Sennheiser or Etymotic headphones and Headroom or Creek amps!"

That's probably because they're the only game in town.

I wonder how many of us would be willing to pay 2,3, 4, or 10 times as much money for portable CD/MD players if they carried the badge NAD, ARCAM, or Mark Levinson on them?

Would they be worth the difference?

 

[bootman]

Here is some Luxman info:

http://members.aol.com/luxmanusa/

and here is a listing of the products (In Japanese)

http://www.luxman.co.jp/product/index.html

Enjoy!

 

[Eagle_Driver]

mbriant: True. The practice of matching mass-market PCDPs with high-end audiophile cans and at least mid-fi amps is practically the only game in town - unless the listener is content with listening to his/her mass-market PCDP directly from its crappy op-amp through even crappier stock headphones.

 

[mbriant]

Bootman: Thanks for the Links. Most of the photos aren't coming through, but the ones I saw indeed prove that Luxman's thinking is back where it was in it's glory days. I've been using the Grandaddy of their top of the line integrated amp for nearly 20 years now. Years ago I sold a Luxman L-12 tuner to a friend for $100.00. It had the smoothest flywheel/analogue tuning you could imagine and had an incredible auto circuitry which turned on electromagnets to slow you down and then lock you onto good reception stations. For a while, each new Luxman lineup launch would include some new innovative feature. That old tuner also pulled in stations better than any other tuner I've owned, including the digital matching tuner to my L-550 integrated amp.

Some of their old tube equipment were works of art.

I hope they get back on their feet again.

lini: My memory sucks sometimes, but I think Sansui was the first "major" Japanese electronics company to ever declare bankurptcy. Rumour has it they were kept alive for a time by their competitors, in an attempt to "save face". Sansui did make some nice amps and some big mother receivers. Perhaps the name's been revived and is on some lesser quality systems today.

Tandberg specialized in reel to reel, then cassette decks. They were Swiss or Swedish or Norweigan weren't they? Very high end. Very expensive. Revox and Nakamichi and to a lesser degree, Teac, were their competition.

 

[lini]

mbriant: Yep, Tandberg is from Norway. They still produce some high quality streamers, but no hi-fi anymore. They also had at least one very good amp, but I'll never forget their tape deck with a 1/2" steel base plate.

Greetings from Munich!

Manfred / lini

 

[sapphiremodena]

Quote:

I wonder what happened to Sansui, though - another Japanese manufacturer, that has disappeared a few years ago. They used to have some good mid-fi amps...

Lini, I own a TV made by Sansui!! I bought it about 1 and a half years ago, it was really cheap ($200 Canadian, about $130 US), and I needed a 19" (at least) TV just to put in my room. It's good for the price. I got it on my 14th birthday, as a combined gift from my whole family, and my grandparents paid $50 towards it.
Whoops, I'm going off in a different direction there, hehe!
Anyways yeah it's a good TV for the dirt cheap price, and you can get them at Costco [I think Costco is a Canadian store, but not too sure]
Point is, Sansui is probably still around, cause I still see their TV's at Costco, unless they are old models

I had no idea they made higher end stuff, I'm gonna try to find some pics on the net.

 

[chych]

Quote:

[I think Costco is a Canadian store, but not too sure]

Man, they are everywhere in the states... and you can get some nice deals there (picked up an awesome garden hose nozzle set for 10 bucks a few weeks ago

)

 

[Apheared]

isn't that an oxymoron? you can mass market disposable baby diapers, soda beverages and beer, toilet paper... even expensive things like cars...

headphones?? mass market?

Most people use what comes with thier portables, or buy a sub-$100 set for home. WE'RE the only people that care.

That price scheme you envision has very little to do with the distribution method... no, it's the only sales volume that could do it, and there's not that much interest. Even counting commercial sales like recording studios and production houses buying 50 sets at once, I bet people like Sennheiser would be dancing in the streets if they could sell 100,000 units a year.

Although, I'd fall over dead if I saw a Grado television commercial.

 

[KR...]

Please correct me if I am wrong here, but I always thought that the Grado SR-40 was suppose serve this purpose. Maybe not at the level that you are thinking of, but more or less, no?