Au contraire- The reason any company is in business is to Cherchez le creaneau.
That is, "find a hole", or "fill the hole".
If the demand does not already exist, you must spend mucho moola to educate
the customer that he really needs this. If the demand already exists, you
simply fill it, and fill it better/ more uniquely/ better positioned/ than
anyone else, and your job is done for you. The demand of the upper tranch of
ham radio enthusiasts remains a gaping maw, even when the rest of the world is
worried about the economy . Flex has slipped its technology into this maw
nicely. Now I only hope they don't stumble on release, and have to live
down bad press until SuperSDR 2. I suspect they're a lot more tempered now.
Jim KJ2P > Date: Mon, 30 Jul 2012 14:55:40 +0000
> From: [email protected]
> To: [email protected]
> CC: [email protected]
> Subject: Re: [FlexEdge] why so many for sale
>
> All these marketing techniques points to the real reason any company is in
> business, to create customers.....
>
> Dennis KØEOO
>
>
>
> ----- Original Message -----
> From: [email protected]
> To: [email protected]
> Cc: "Flex Edge Reflector" <[email protected]>
> Sent: Monday, July 30, 2012 9:34:57 AM
> Subject: Re: [FlexEdge] why so many for sale
>
> Excellent analysis...this is what I would have written Saturday if I hadn't
> been limited to my cellphone :)
>
>
> Mike Alexander - N8MSA
>
> [email protected]
>
> ----- Original Message -----
> From: "Peter G. Viscarola" <[email protected]>
> To: "Flex Edge Reflector" <[email protected]>
> Sent: Monday, July 30, 2012 10:09:22 AM
> Subject: Re: [FlexEdge] why so many for sale
>
> It's all about marketing and pricing and product introduction strategy, isn't
> it.
>
> The standard strategy for high-end tech products is:
>
> First wave: You introduce a cutting-edge, highly differentiated, novel, model
> at a premium price. There will be people who buy it who buy it because they
> want "the best" and can use it's features to their maximum potential, there
> will be people who buy it because they want to the latest technology, and
> there will be people who buy it because it's expensive and they want to show
> their friends they can afford it.
>
> If the product is sufficiently well differentiated, there's really no
> competitive pressure. A customer buys your premium price product or misses
> out on the newest technology.
>
> By introducing your newest model at a premium price, you maximize your profit
> and recoup your R&D expenses more quickly. The "early adopters" are happy.
> You're happy. The market is "seeded" with a bunch of happy people, and the
> blogs are full of great reviews. Ordinary folks are saying "I wish I could
> afford one of those, because they're great." That's when you launch the
> second wave.
>
> Second wave: After you've filled the initial wave of orders, you use the same
> technology (the R&D already having been paid for) but remove a few features.
> You offer this model at a substantially reduced price from your initial
> offering. This is really the "sweet spot" for most buyers, where the "bang
> for the buck" is. The product has perhaps 90% of the capability of the
> premium priced model, but is sold at maybe 60-70% of the premium model's
> price.
>
> This is mainstream adoption. More good reviews, more happy people. You wait a
> while, and introduce your third wave.
>
> Third wave: Your create a low-end derivative, at a "value" price point. This
> uses the same base technological innovation as your first and second wave
> products, but has a significantly reduced feature set and vastly reduced
> cost. This is the "introductory" point in your product line, aimed at getting
> people who are not normally buyers for your technology to buy one of your
> products, in hopes that they'll get to know you, love your stuff, and
> eventually upgrade... either in the current or next generation.
>
> This is standard tech marketing 101. Look around and you'll see many, many,
> products that follow this pattern or a small variation of it.
>
> Look at the 6700, and *especially* the 6700R -- These look like First wave,
> price premium, no-holds-barred, products. I applaud Flex for introducing
> them, and am actually a bit surprised that they priced them so reasonably. I
> suspect they have taken the economy into account, and introduced the 6700 for
> about 20% less than what they could have charged.
>
> What Flex have done -- which I think is very considerate of the amateur
> community -- is introduce their Second wave product, the 6500, at the same
> time as their first wave product. Again, I suspect they very carefully
> considered the economy here... this is a difficult time to be introducing
> price premium products in a hobby market. By introducing Second Wave products
> at the same time as First Wave products, they're maximizing product uptake
> (the number of people who buy the product, total) and probably total sales.
> They are likely not maximizing their profits.
>
> They ARE being considerate of the ham radio community by releasing the 6500
> early-on that many serious hams (serious QSO'ers or serious technology
> addicts) can afford. I would *guess* that making such a great piece of gear
> available at a reasonable price to the amateur community that has supported
> them for these many years as a "thank you" of sorts is part of their
> calculus. I can tell you, if I was the CEO of Flex I would have shipped the
> 6700 and 6700R first and then intro'ed the 6500 for immediate delivery about
> 9-12 months later. But, I'm not nearly as nice as the people at Flex. And I'm
> sure they have their reasons, and information that I don't have.
>
> Bottom line: Don't complain about the price. These folks aren't price
> gouging. They're not even following the "standard play book" for maximizing
> profits in the tech sector. Rather, they're introducing truly innovative
> technology and letting us buy-in at a darn reasonable price. Which is darn
> nice of them if you ask me.
>
> Peter
> K1PGV
>
>
>
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