What do you think separates very successful luxury companies from the less successful

[LetSleepingDogs]

Companies like Wilson, Magico, Martin Logan, etc. command a large following and make millions of dollars per year, whereas Von Schweikert, Avalon, Marten, etc. have a much smaller following, and presumably bring in much less revenue.

What makes Wilson and Magico different than Von Schweikert (other than a name that is easy to spell)? Is it less luxurious to own a Marten than a Magico? Are Magico's cabinets better looking? Is Wilson's heritage more enticing than Avalon's?

What is it?

On a similar note:

What is it about the brand of YOUR loudspeakers that made you want them? Did you hear about them on a forum and decide to try them? Did you walk into an audio shop and leave with the best sounding product they had?

Are audio shops as important as they once were? Would you ever buy a loudspeaker without hearing it first? Take the poll!

Thanks for taking the time to join the discussion, this could be very interesting.

[JackD201]

In a nutshell, it's the effort to market and the acumen to follow that up with scaled up production capability. Since both require a larger war chest, those are preceded by having a key person that can secure such funding. In other words, the companies that are better at creating demand and are able to satisfy that demand will have greater volume.

[Bill Hart]

Though high end audio gear is a "luxury item" for most economic and social/cultural purposes, I don't think it follows the key driver of the luxury goods market: avoiding fashion victim status. A Birkin bag (no longer by that name since I think Ms. Birkin asked Hermes to finally remove her name from the bag) sells to affluent women because of its coolness factor. Its a leather tote bag with heavy symbolic status. Ditto the Audi or Lexus automoblie- both pretty good cars, but ones that are sold heavily in NY metro to many "I don't know anything about cars" type folks. So too with many trendy restaurants-- where the food is good, but no better than many other places. It's because it is cool to be seen there.
I don't think the difference between successful and less successful audio gear companies can be attributed to that, though there are "cult" aspects to Wilson, Magico, etc.

[LetSleepingDogs]

Though high end audio gear is a "luxury item" for most economic and social/cultural purposes, I don't think it follows the key driver of the luxury goods market: avoiding fashion victim status. A Birkin bag (no longer by that name since I think Ms. Birkin asked Hermes to finally remove her name from the bag) sells to affluent women because of its coolness factor. Its a leather tote bag with heavy symbolic status. Ditto the Audi or Lexus automoblie- both pretty good cars, but ones that are sold heavily in NY metro to many "I don't know anything about cars" type folks. So too with many trendy restaurants-- where the food is good, but no better than many other places. It's because it is cool to be seen there.
I don't think the difference between successful and less successful audio gear companies can be attributed to that, though there are "cult" aspects to Wilson, Magico, etc.

Interesting opinion!

If not coolness factor, what do you think success can be attributed to?

[Bill Hart]

Interesting opinion!

If not coolness factor, what do you think success can be attributed to?

I don't know. My best answer to your question in audio would be:

[MylesBAstor]

My parents had two Packards, a '52 that ran and '57 that was always in the shop. The '57 Packard Clipper transmission was the Edsel of drive trains. A nightmare.

[JackD201]

Though high end audio gear is a "luxury item" for most economic and social/cultural purposes, I don't think it follows the key driver of the luxury goods market: avoiding fashion victim status. A Birkin bag (no longer by that name since I think Ms. Birkin asked Hermes to finally remove her name from the bag) sells to affluent women because of its coolness factor. Its a leather tote bag with heavy symbolic status. Ditto the Audi or Lexus automoblie- both pretty good cars, but ones that are sold heavily in NY metro to many "I don't know anything about cars" type folks. So too with many trendy restaurants-- where the food is good, but no better than many other places. It's because it is cool to be seen there.
I don't think the difference between successful and less successful audio gear companies can be attributed to that, though there are "cult" aspects to Wilson, Magico, etc.

I think "desirability" is universal when it comes to premium wares. What defines that desirability is what differs. In any case what becomes secondary in luxury markets is basic functionality as this is present down to commodity level goods. I think this is applicable to any industry.

[LetSleepingDogs]

I think "desirability" is universal when it comes to premium wares. What defines that desirability is what differs. In any case what becomes secondary in luxury markets is basic functionality as this is present down to commodity level goods. I think this is applicable to any industry.

Well said, Jack, and thank you too for the reply.

I agree that basic functionality is secondary. As you said (in so many words) there are many loudspeakers that aren't considered luxury that sound every bit as good as those that are. Though, to be fair, many of the more expensive, luxury loudspeakers employ large bass drivers because those that can afford them typically do not have the space constraints of their less well-off counterparts.

[Bill Hart]

I think "desirability" is universal when it comes to premium wares. What defines that desirability is what differs. In any case what becomes secondary in luxury markets is basic functionality as this is present down to commodity level goods. I think this is applicable to any industry.

Good distinction, well articulated, agreed. So the question is why one thing is more desirable than another. I understand that, when comparing a high line good with a basic commodity, the differences can be easily described- from the quality of the packaging to the parts inside. But, if the question is comparing one high end brand to another, why is one more desirable than another? A cynic would say marketing, but I'm not that cynical. I would assume that a great majority of folks buying big bucks gear aren't suckered in by a slick brochure or specious technical claims. There must be legitimate differences, right?

[JackD201]

I think they all market so I agree with you that only a cynic would use marketing as a blanket response. Personally I appreciate good marketing since what it really is, is getting the value added across to the consumer and translating that into desirability. While there are some brands out there that are getting by on sheer advertising force and get to demand premium pricing as a result, I think these are more the outliers. Brand recognition can only take a company so far and for so long. Pretty evident with brands that have been bought only to be repositioned later. So all I can come up with regards to your question Bill is the value added proposition as these relate to the target market. I think this is the root of the divergent product offerings. The really successful companies cast a net that is a bit wider, ramp up desirability so the second hand market spreads that wider still. This second one causes a loop that is every businessman's dream scenario. It's like having a little perpetual motion engine tucked away giving some extra BHP LOL. I suppose sometimes this loop is brought about by skill alone, sometimes it is serendipitous, but one thing for sure, it takes savvy to keep it going. If I could do this myself, I reckon I'd be a very wealthy guy! The case studies are fun things to read really. Amazing how rarely they are replicated if at ll.

[LetSleepingDogs]

I'd be interested in reading any case studies for which you have links.

Are you in marketing, Jack?

[Bill Hart]

I think they all market so I agree with you that only a cynic would use marketing as a blanket response. Personally I appreciate good marketing since what it really is, is getting the value added across to the consumer and translating that into desirability. While there are some brands out there that are getting by on sheer advertising force and get to demand premium pricing as a result, I think these are more the outliers. Brand recognition can only take a company so far and for so long. Pretty evident with brands that have been bought only to be repositioned later. So all I can come up with regards to your question Bill is the value added proposition as these relate to the target market. I think this is the root of the divergent product offerings. The really successful companies cast a net that is a bit wider, ramp up desirability so the second hand market spreads that wider still. This second one causes a loop that is every businessman's dream scenario. It's like having a little perpetual motion engine tucked away giving some extra BHP LOL. I suppose sometimes this loop is brought about by skill alone, sometimes it is serendipitous, but one thing for sure, it takes savvy to keep it going. If I could do this myself, I reckon I'd be a very wealthy guy! The case studies are fun things to read really. Amazing how rarely they are replicated if at ll.

Yeah, Jack, I don't know the answer either. When you look at Apple products, they can charge a premium, partly due to design, partly due to slick ergonomics and partly due to innovation (some of which I don't need). They created a perpetual motion machine in some ways--you have to buy all their stuff to use their stuff, and so on, the next best thing is a must have. That operates to a degree in high end, but I'm not sure it's a factor- some beloved stuff- like Lamm- doesn't reinvent the wheel every two years, looks like it's meant for a missile silo and advertising and marketing? Not much that I'm aware of (I don't really read the stereo mags any more so don't know). But it has a cult following nonetheless. In that case, i attribute it to what the product does, and not external factors- whether people "buy into it" is something that may be outside of the manufacturer's control to a degree. Nice to chat with ya! Dunno if any of this helped LSD, but I'm not sure I have any more to offer on the subject. You could ask the same question about music too--why some stuff clicks and endures and other stuff, just as good, fades into the mists of history.

[JackD201]

Miss chatting with you too brother. The new job is a free time killer!

[Metamatic]

Advertising, lots of review samples, a wide productive dealer network, and more advertising.

[JackD201]

I'd be interested in reading any case studies for which you have links.

Are you in marketing, Jack?

It was my undergrad with a minor in behavioral science. Our main business is media though (TV and Radio Networks) so while we may not produce the ads we still get a lot of exposure to them.

[Stefan]

I think most hifi products are conceived, designed and build by relying on technical and engineering competence. Luxury companies approach the process far more from a market perspective. Market research, consumer preferences, brand building and typically a holistic definition of value rather than a mere technical competence, drives these companies. In successful luxury companies, the tangible and nontangible characteristics of products are carefully managed. I think marketing plays an important role, but I believe it starts with a market definition of quality and value rather than a theoretical ideal or as it is most of the case, the projection of a high profile personality of what quality means. Hifi companies are typically resource-strapped which limit their ability to build these additional capabilities or buy in it. Of course. there are exceptions.