Marketing rants

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Here is a better explanation of the book "All Marketers Are Liars".

Be a Better Liar - May 1, 2005

The message is people believe stories that agree with their world view.

Bose tells a story that speaker design is very difficult and needs Ivy League PhD and lots of research money. Most people love that story and will pay a premium for the products.
Most of us violently despise the story and would not be caught dead owning one.

I now ask myself what story marketing is telling. Sad part is I still am not immune.

Doug
 
There will be good examples and bad. I don't see a lot of examples of good "value" in hi-end audio. A few companies who hold high quality, but almost universally at a premium price. There don't seem to be too manys "Honda's of Audio".

I'd say IAG (mainly Wharfedale) would fit that bill. Maybe Jamo. I think the tendency though is for people to think that the more expensive speaker with higher WAF sounds better even if the only thing different is the glossy finish.
http://w4.stern.nyu.edu/emplibrary/jobmarket_paper_plassmann_final.pdf

If you assume that is true then the "Honda Business Model" might work better imo. That is make your entry level speaker just as good as the more expensive models just with no WAF (preferably plain black) and most likely in a small modular (stand mount) design. And as you go up the line in upgrades you get either a better WAF/finish, more bass extension, or less distortion/increased dynamic range. The more expensive speakers really don't have to be much better than the entry level line - people will still get the upgrade bug - they just have to be as good or a little better.
 
If you assume that is true then the "Honda Business Model" might work better imo. That is make your entry level speaker just as good as the more expensive models just with no WAF (preferably plain black) and most likely in a small modular (stand mount) design. And as you go up the line in upgrades you get either a better WAF/finish, more bass extension, or less distortion/increased dynamic range. The more expensive speakers really don't have to be much better than the entry level line - people will still get the upgrade bug - they just have to be as good or a little better.

Except thats not reality. It costs more to make higher performance so it has to sell for more unless you gouge the low end product and that IS NOT the Honda model. Basically I see the Honda model as a consistant vale all the way up the line - you pay more the product is better. In a loudspeaker its how you define "better". If better is shinier or more WAF then thats one thing, but if better actually means Sound Quality then thats anothre thing entirely. So you really have to pick which it is that you want to do. I DO sound quality, others do WAF and just claim sound quality.
 
Lol yeah I guess I am all over the place with my analogy - not a car person really. To me if you isolate Wharfedale from the sister companies it is consistent quality up the line with actual tangible improvements - bass, dynamics, spl. Maybe there is a little WAF mixed in with there Opus line but really look at those drivers and compare them to there only competition - ATC, and K&H - and they offer considerable build quality for the price.

Now if you mix in the sister companies like Quad - which seem to have some of the same products but with better WAF - and yeah my analogy falls to pieces. At that point it's more like Chevrolet, Cadillac and Buick where they make the same thing with interchangeable parts but with different WAF. Anyway I can see how certain finishes could realistically add to the cost of a product.
 
Anyway I can see how certain finishes could realistically add to the cost of a product.

I'm discovering that finish is a major factor to cost, almost a driving factor. Think about it for a minute - if you have X to spend and the major factor in your decision is "finish", how much "sound quality" do you think that you are going to get? This, as I see it, is the current marketplace - dominated by looks and finish with virtually no attention to sound quality. Not my cup of tea thank you. Finish is not irrelavent, but when its about all you are buying then its a problem.
 
As a professional marketer, engaged at the consumer end of my market I know two things to be true and almost more important in leading to a sale than anything else.

1.People buy with their eyes. 2. If you present them a story they can believe in, even better if you leave a few blanks in that story that they can fill in for themselves, you stand a much better chance of making a sale.

Of course these two only become really important if you work in markets saturated with me-too products with little or no differentiation in specification or performance- like Hifi.
 
Yeah, that is true with a lot of companies. Some that I have mentioned have 2 models though one without the fancy finish and one with it. The disparity between the prices on the two models can be shocking. I forget the difference in price but I think it's somewhere around 10 grand difference between the home and the pro with these 2 TransAudio Group - SCM50ASL
ATC Loudspeakers. ATC Monitors. ATC SCM. ATC Speakers. Manufacturers of speakers, monitors, drive units and amplifiers.
And the undercutting Wharfedale copy that might actually be better
Wharfedale Opus (Version 2) M1, 3-way Monitor Bookshelf Speakers (
you pay $750 for the gloss finish - to be fair this finish actually IS labor intensive and takes about half a month of adding layers of paint and letting it dry each day.

And actually with some of the models which are pretty much the same it seems like the cheaper one might be the better build. Casually comparing my speakers to the more expensive version from QUAD with the WAF, the WAF model is missing the waveguide on the mid driver.

Beyond all this I think what happens more than not is name brand reputation or recognition. If ATC didn't have a reputation no effing way would anyone buy those 3 ways for 15 grand. And it's basically what Lexicon was doing with the re badging thing. It does seem to be throughout the industry - studios that need to get clients in the door need the right brand name gear even if they could get better without the brand name for cheaper.
 
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And we can't overlook color printing or pictures on boxes. I'm sure that can drive up costs. If the box itself has to have a visual appeal then someone is designing it and getting paid. Color print cost more than duotones or b&w. I don't think it's a coincidence that the best bang for buck gear I have purchased came in either plain brown boxes or with b&w printing if any at all.
 
First day of Marketing 101, Igal Ayel posed this situation--One person reads a lot of mags, shops around and buys components for a stereo system from different stores. One person goes to one store and buys different components for their stereo system. One person buys a compact system for their stereo (yup, that's how long ago this story if from).

Which person was the happiest?

Each person was, because they had purchased what they wanted. While some people might argue about the simple moral of the story, it does serve to illustrate a simple concept--people buy what they want. It also shows how one person's bias, or anecodital evidence may not hold true for a population


One of my favorite Journal Articles is from Nature, Prospect Theory by Kahanaman and Traversiky, exposed during another marketing class a couple of decades later (no more compact stereo players).

The "anointed" article, it is a highly respected peer review journal, is a seminal article about risk aversion.

If I remember it correctly, it establishes a sigmoid response to risk.

They created a scenario with a fixed population suffering from flue?

One group of people are told if they administer medication 60% of the people will die.
The second group is told that if they administer medication 40% of the people will be saved.

A simple Venn diagram shows that the outcomes are identical. If the outcomes are identical, then both groups should choose equally between giving the medication and not giving it. Corse, they don't.

Moral of the story, consumers are risk averse even under conditions of certainty.

Many years later, in another marketing class, a concept called a heuristic for problem solving under uncertainty is brought up. It seems as if what many people call brand loyalty is loyalty to a method of problem solving under uncertainty.

Another interesting concept, well at least it is to me, is called product positioning--how one positions a product in multi dimensional space (inside a consumers head). Stating that a company positions a product, or service within a consumer makes sense in light of advertising. But, the fly in the ointment is once again how the consumer positions a product in their head, how they respond to your efforts--they do the positioning.

It seems as if we came back to Marketing 101. Position your product as better than compact stereo and the consumer might position your product as worse than a compact.

Much to the delight of many researchers and consternation of many, if you drop a ball from a fixed height under fixed conditions, you'll get the same results, and can develop a formula for gravity that accurately predicts. Once the ball is replaced by a human being, some of them will decide to ascend instead of descending.

Once can create segments of consumers and tailer products and communications in hopes that segment will respond favorably. But, one might have the view that consumers aren't segmented, and their loyalty is to themselves.

To further beat a dead horse, I don't like beets. No matter if they are award winning, orange, called Borsch, are in Jello, have perfect fit and finish, deep fried, or steaming hot with fresh butter--beets are vile loathsome odious balls grown in dirt.

Got a theory about Marketing, maybe its incomplete. Maybe your theory conforms to your expectations.

Maybe you do insane things like buy beats?

Maybe consumers have basil emotional drivers; emotion as the only language that allows comparison between and across similar and dissimilar choices?

No logic, just emotional reactions from drivers we all share.

God I hate Rap and most Country.

Best from Tucson
Bob
 
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This, as I see it, is the current marketplace - dominated by looks and finish with virtually no attention to sound quality.

Hmmm... we most go to different shows or listen to different systems.
While I will admit that there is a lot of over priced fluff on the market, there are quite a few folks at least trying to make nice sounding gear. Some succeed rather well and their stuff sounds a lot better than it looks.
 
Maybe, Marketing is the study of the flow of goods and services.
Its easy to assign "marketing" as the reason for many things, entities engage in the flow of their goods and services.

Econ 101, marginal revenue = marginal cost, that is where entities produce. It is a simple model, maybe very useful to figure out why an entity engages is behavior an individual doesn't prove of?

It could be that its easier to provide customers what they want, rather than educating them why what they want isn't good for them.

If I remember correctly, one of the chapters towards the end of Econ text books models Market Externalities, global warming.

Best from tucson
Bob
 
Wow Bob, I don't think I understood any of that..... :(

Bob is quoting classic marketing - 101 as he says (All marketers are liers ... that sort of thing). My reason for establishing this thread is to point out just how far wrong some of this thinking has gotten us. All I can say is that the guy who bought the high priced DVD player may very well be as happy as the guy who bought the identical one at half the price (oh yea the logo changed so it was different :)) - some people are simply fools - but shame on the people who created the situation in which this occurs and their attempt to scam the consumer. No amount of marketing explanation is going to make me believe that this is OK.
 
I don't like Rap music either Earl.

For a while, I was interested in why people do things!?! I had the opportunity to take a few classes from people who had published quite a few articles in "top-tier" Marketing Journals (JAMA was Journal of American Marketing Association). Essentially, I was reading research articles about consumer behavior and discussing them with teachers who were there because they had published a few well liked research articles.

At one time I wondered what is knowledge and where does it come from? I also wondered if we discover mathematics or invented it? Anything past Calc II is marvelous magic to me.

To me, a lot of this stuff, consumer behavior, centers upon emotions, emotional reactions. Seemingly, emotions are given short shrift in Economics--identical (functioning) products should have identical value, or be valued identically by consumers.

Sometimes, buying a product involves taking a risk, the outcome/result cannot be forecast with 100% certainty.

Buy a commodity, like a box of salt, you know what you are getting; you know how it will work.
Buy a slabbed 1 oz gold Eagle, you know exactly what you will get.

Buy something where it is impossible to judge its "quality", like a black box and one must look for clues, gather information.

That's where the FUN begins, because we all aren't the same; not looking for the same performance from black boxes; don't interpret black box performance the same.

Sometimes people use price as a clue to quality of a black box. It doesn't seem possible, but sometimes if you can't sell your black box, raise the price.

Did I mention I don''t like RAP!

Ahhhhhh. Top top off all of the uncertainties, one could ask what is a dollar? What does a dollar represent? A dollar is equal, a classic example of a fungible item. But, a dollar isn't the same to everyone. If you have a pile of dollars, lets say 100, your dollar many not be the same as the dollar where someone has a pile with 1,000, or 1,000,000, or like baliout piles of dollars, 1 and just how many dam zeros come after government piles?!!

So, there we are. The buck in everyones pocket isn't valued the same; we don't value identical products the same. Course, we valued different products, differently!

Me. I don't know why people wast their piles of $ on Harley Davidsons!? Course, I had HD fever for many years.

Best from Tucson
Bob
 
Your point about $ not being equal to all of us is certainly true. I see it all the time and then I go to China and find that RMB is entirely different to me than the Chinese.

What I do, as far as marketing, is driven by something so unusual that most marketers would say that I'm nuts. I don't want to sell something that I am not proud to make and I don't want to charge more than it's worth. It's a personal thing, and I can afford to be that way. If this doesn't meet with my customers "wants" then so be it. Not everyone is enticed to buy, but no one who has is complaining.
 
It makes perfect sense to me Earl.

One of my other hobbies is making vases on a potter's wheel. Since its a hobby, I'm free to make whatever I like, to try whatever I like. I line the edges of my drive way with vases i don't want. Seems as if UPS drives like to exceed the width of my drive way. When they drive over a vase, I can hear the POP!! in my house. Maybe the stuff I put out there is so revolting they are compelled to destroy it?

Best from Tucson
Bob
 
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