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Retail Prices


Jim Aikin

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Recently Keyboard has started reviewing selected instruments that have speakers and one-finger arrangement features. Some of them are quite cool, but the traditional marketing methods for this type of product create a problem for journalists. Most manufacturers don't publish any Suggested Retail Prices for these items. Instead, they let their local dealers set prices based on what the market will bear.

 

But as Bob Moog once remarked, the retail price is the most important parameter of any product, because it dictates everything else: the number of knobs on the panel, the number of voices of polyphony, the amount of memory, the quality of the keyboard mechanism, etc. It's totally wrong to criticize a $500 synth for lacking the features of a $2,500 synth.

 

So what's a magazine to do? If we publish reviews with no prices, we have no way to calibrate which set of expectations may be reasonable for the instrument we're testing, and which expectations may be pie in the sky. Plus, readers will have no real way to gauge whether the instrument ought to be on their shopping list.

 

But if we do use our crystal ball to publish a price, the number is more than likely to be wrong -- possibly way wrong. At the same time, it will annoy the heck out of both the manufacturer and the dealers.

 

I'd be real curious to know how this problem looks from the outside. What would you do if you were in our shoes? Do you rely on Suggested Retail Prices when you're in the market for a piece of equipment? I mean, discounting is fairly normal at pro music stores, so is the SRP irrelevant to you?

 

--Jim Aikin, Senior Editor, Keyboard

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Well, one of the recent trends among MI manufacturers and dealers is to discuss MAP (minimum advertised price). Maybe you can print that for these units, if it's fairly uniform...

 

I know that this has been an issue for some MI dealers for a while - it rears its head with the products that are traditionally sold in P&O (Piano and Organ) retailers, many of which also do not have MSRPs. The P&O guys prefer it that way - they control their margins. So, the way that some of the MI stores that also sell these same products have chosen to deal with this is to basically invent their own MSRPs, just so they can show what a great discount the end-user is getting.

 

I remember this happened with the MOTU 2408 as well - MOTU didn't publish a list price originally, just an MAP (of $999, if I remember correctly). I also remember seeing an "MSRP" of $1299 on it at some stores - same deal...they made it up so that people could feel that they were getting a discount.

 

An interesting way of doing business...what do you all think? Is this a deceptive business practice, or is it just a novel approach to an interesting problem? Is it dishonest? If you found out that the store that you were patronizing had invented an MSRP on the product you were purchasing, how would you react?

 

I hope that this doesn't derail your thread, Jim...

 

dB

:snax:

 

:keys:==> David Bryce Music • Funky Young Monks <==:rawk:

 

Professional Affiliations: Royer LabsMusic Player Network

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This one's easy Jim.

 

When I had a product reviewed by Consumer Reports, they refused to print the MSRP at all. Instead, they printed what they *paid* for the product in the store where they purchased it.

 

If the manufacturer literally refuses to give you a list price for the product, it is completely in your discretion as a reviewer to print what a person should expect to pay for the product at the point of sale. To get that price, call up a dealer who carries the box and ask them how much they sell it for.

 

I believe in list prices. People need a yardstick by which to get an idea of the product's value. I'm glad to have MSRP's on every product on my web site.

 

As a side note, though, I hope everyone realizes that manufacturers by law cannot control the price for which retailers sell their product.

 

- Jeff

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I wouldn't be at all offended if when no price was available, the review said "no price available."

 

I think having the price (when available) is a key component to a review. When possible, I;d like to see a "street price," but I don;t think this is possible with most of the stuff that's reviewed, since a lot of it hasn't hit the street when it's reviewed. I've gotten fairly good at guessing a product's street price from its MSRP, so this isn;t a real big deal for me.

 

Jonathan

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I need to see the SRP of a unit that I'm interested in. I HATE reading reviews of products without prices on them. Everything you said is true, needing a gauge and all. I don't know what's a good solution, but my request is for you to try your best to get them to print prices.

 

 

Raul

Raul
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In the British guitar magazines, although they do tell you the price of the gear they're reviewing (often out of line with the retailer ads in the back of their own magazines), their most 'innovative' departure is that on the first page of the review, they print a three-inch box column that gives comparison gear currently on the market - if the flanger being reviewed is L150., they list other flangers in the price range of L100 - 200 . . . along with brief comments about their features and specs.

 

Being a libertarian capitalist at heart (socialist in practice), this really appeals to me - you see what features make this unit distinctive, and how a small margin of price changes the 'target market' of the competitors gear .

 

Often, once you've made a decision to buy a piece of gear, it isn't the price you pay that's the determining factor - it's what you get for the price you pay.

 

The 'roundup' vignette gives you perspective on how the different manufacturers are thinking, as well.

 

Next time you're in a large bookstore, check out the magazine section for gems like 'Guitarist' and such - thick magazines with CD's attached to the front cover. Those are the reviews that I'm referring to (and having the CD with the sound of the reviewed equipment could be a determining factor as well - nowadays, though, you can post review snippets as MP3 files for those interested in that particular review).

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I would like to see you print both the MSRP and the street price. Even better would be to include the markup whether it is an "A" markup, "B" markup, "C" arkup, etc. (This is the most important info). The markup info is what I always try to find out, sometimes it is like prying teeth.

Buddy

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As a 'former' retailer, both in a small store and in a huge chain, retail price is the starting block. As a consumer, I like to know what the company thinks it should cost. From that, I can gauge what I may be saving. When I buy a car, if the MSRP says $X, but it's a close-out model, you can bet I'm going to expect a bigger discount than this year's!

In the mag, if a retailer doesn't have an MSRP, I'm going to wonder if I'm going to get a deal at all... go ahead and print "no retail price available." I'll know I need to shop around.

--Murph

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Originally posted by lrbreez:

Even better would be to include the markup whether it is an "A" markup, "B" markup, "C" arkup, etc. (This is the most important info). The markup info is what I always try to find out, sometimes it is like prying teeth.

 

Probably the reason that this information is not readily available is that it may not be the best idea for an end-user to determine what is a reasonable profit margin for the dealer to make, since the average end-user doesn't necessarily understand the costs of running a business.

 

I'd also like to add that there is also a difference between running a business, and running a business WELL. I have seen many posts in many different places complaining about the lack of qualified sales help in MI stores. Well, this sort of thing is one of the reasons why this is the case. When businesses make very low margins on product, the emphasis tends to turn to volume and away from service. If that is the case, then the business owner is going to probably tend to hire lower-cost clerks rather than higher-cost qualified salespeople.

 

Is that what we want? IMO, the inevitable conclusion of this business model is that the manufacturers will eventually just figure out that they may as well just sell direct to the end user - if this turns out to be the case, negotiable pricing will go right out the window.

 

dB

:snax:

 

:keys:==> David Bryce Music • Funky Young Monks <==:rawk:

 

Professional Affiliations: Royer LabsMusic Player Network

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Originally posted by Dave Bryce:

Probably the reason that this information is not readily available is that it may not be the best idea for an end-user to determine what is a reasonable profit margin for the dealer to make, since the average end-user doesn't necessarily understand the costs of running a business.

 

Good point. This is precisely why Keyboard doesn't publish "street prices." The street price in LA or NYC is likely to be lower than the street price in a small town, and it's not fair to the small-town dealer (who has to pay the rent but has much less foot traffic coming into the store) to publish the NYC street price.

 

For the same reason, we'd prefer not to muck up a manufacturer's relationship with their piano-store dealers, who are entitled to run their businesses as they see fit. Yet at the same time, we have an obligation to our readers.

 

That's why the MSRP, even if it's a somewhat artificial figure, is so useful. When we review a $1,995 synth, we know it's likely to be selling on the street for anywhere from $1,200 to $1,995 depending on various factors -- but it's still legit for us to compare it across the board with any other $1,995 synth, because that other synth is subject to the same price fluctuations, will most likely have been sold to the retailer at about the same wholesale price, and will have cost about the same amount to build.

 

Sometime soon I'll post the rest of the story of the pricing of this particular piece of gear, but it would be premature to do so at present.

 

--Jim Aikin

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  • 6 years later...

An interesting article

 

By chopping 3,400 of its most highly paid retail staffers, the country's second-biggest electronics retailer is making a losing bet that the drop in sales resulting from canning its best sales people will be more than offset by the lower pay that it gives to the less capable replacements.

 

"Music expresses that which cannot be put into words and that which cannot remain silent." - Victor Hugo
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This does bring up an interesting question though:

 

Dave's premise is that we're getting awful service from stores like GC because they don't make enough margin to pay higher salaries for knowledgeable, attentive salespeople.

 

How is the MI business different from other businesses? Surely there are other markets where getting the lowest possible price is everything to the consumer. How do those businesses handle this issue? Are their salespeople uncaring and incompetent too? Certainly the MI business is not the only market where internet price comparisons and out-of-state shipping are commonplace, right?

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How is the MI business different from other businesses? Surely there are other markets where getting the lowest possible price is everything to the consumer.

I would suggest that the average MI keyboard/recording product is in the upper part of the spectrum of stuff that is better served by having knowledgeable, experienced salespeople behind it, like most hi-tech gear. Some of the stuff we mess around with has some pretty steep learning curves, and the really good sales guys are knowledgeable about many brands.

 

While many of us take advantages of resources such as the internet to educate ourselves and may not find knowledgeable salespeople to be something we need, I'd venture to say that more people than not would benefit from having someone who knows what they're talking about as opposed to dealing with some low-paid drone who doesn't know squat and is just there to ring you up.

 

There's also people who would prefer to work with knowledgeable salespeople (and maybe pay a bit more for that privilege) because they enjoy shopping with people who know their stuff, and feel better knowing there's someone they can go to when they have problems. There's a lot to be said for that as well, especially when it comes to systems integration - it's one thing to go to a manufacturer's web site to find out about one of their products, but very few of them will help you learn how well their products work and play with others....

 

dB

:snax:

 

:keys:==> David Bryce Music • Funky Young Monks <==:rawk:

 

Professional Affiliations: Royer LabsMusic Player Network

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Dave,

 

Either you misunderstood me, or I expressed myself poorly. I'm not questioning the value of an educated, attentive salesperson; I agree with you 100%.

 

What I'm trying to ask is this: Is the MI business the only type of business where an attentive, knowledgeable salesperson is preferred? In other non-music related markets where that's the case, how do they deal with this issue? In other high-tech markets where the consumer demands the lowest possible price, are the salespeople as poor? If not, why not?

 

And just for fun: If we, the keyboard buying community decided to be willing to pay an extra couple of hundred dollars per keyboard , how we do we know that those newfound profits will go into better salespeople and not into the retailers pockets?

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I believe that a review without a price is not very helpful to a potential buyer, in terms of determining if a particular product is a good value.

 

An exception might be the high-end, extremely high-priced boutique products that should come with the disclaimer "if you need to know the price, you can't afford it." I would also understand not seeing a reference price if the product uses some incredible, bleeding edge, revolutionary technology that just left the lab, and will change the industry. But for the most part, I think consumers want some pricing information.

 

M.A.P. (minimum advertised price) policies are used by some manufacturers to thwart the efforts of buyers who scour the Internet for the lowest available price. The retailers are threatened with losing their "authorized dealer" status if they violate M.A.P. policy, but they get around this by revealing the discount when you place an item in your virtual shopping cart.

 

But I'd still like to see M.A.P., or the M.S.R.P., as opposed to no price at all.

 

If those two options were not offered by the manufacturer, then I would certainly want a street price -- maybe a range of 5 to 10 prices found at retail stores and online. If you can only find one seller willing to reveal a price, including it in a review is better IMO than listing no price at all.

"Oh yeah, I've got two hands here." (Viv Savage)

"Mr. Blu... Mr. Blutarsky: Zero POINT zero." (Dean Vernon Wormer)

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I remember this happened with the MOTU 2408 as well - MOTU didn't publish a list price originally, just an MAP (of $999, if I remember correctly). I also remember seeing an "MSRP" of $1299 on it at some stores - same deal...they made it up so that people could feel that they were getting a discount.

 

An interesting way of doing business...what do you all think? Is this a deceptive business practice, or is it just a novel approach to an interesting problem? Is it dishonest? If you found out that the store that you were patronizing had invented an MSRP on the product you were purchasing, how would you react?

 

I hope that this doesn't derail your thread, Jim...

 

dB

 

I know it's a bit OT, but I'll take dB's example one step further: As some of you may recall, there used to be a chain of men's clothing stores called Today's Man. Back before the chain went belly up, I used to buy dress shirts there, because I thought they were well made and reasonably priced at around $35. On the price tag of the shirts, however, was not only the store's price ($35) but also a line that at one point said "Sold Elsewhere for $60" and later said "Compare at $60." Now, these were "Today's Man" label shirts! By definition, these shirts weren't "sold elsewhere," and although I knew what they meant by the additional line on their price tag (e.g., comparable quality of material, construction, etc. would cost you $60 at some other store), I always got a chuckle out of those labels.

 

Anyway, carry on. Don't mean to interrupt the real discussion (for which I don't really have a solution to offer).

 

Noah

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I tend not to think in terms of "if this cost x dollars less I would buy it". I first decide if I REALLY want the item independent of price. Then I decide how much I'm willing to pay and whether I can afford it.

 

Case in point: a recent workstation originally listing at over $2000 quickly dropped to a blow out of $500 (at least from one retailer). I was influenced by this ridiculously low price. But in the end since I did't desire it at the original price I wasn't going to buy it for any price.

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All of the responses so far dealt with the price\MAP\marketing\street price\MSRP ... whatever, not the type of 'keyboard' in question being reviewed.

 

In the initial post Jim Aikin mentions selected instruments that have speakers and one-finger arrangement features.

 

One-finger arrangement features? Wonderful. Will there be any endorsements from [fill in your favorite keyboard player]? (The 'power single' performing at your local Ramada does not count.)

 

Sorry, I should know better, one-fingered arrangement features are 'tools' to help us.

 

Keyboard, Keyboard-lite, Keyboard-ultralite .... something for everyone.

No guitarists were harmed during the making of this message.

 

In general, harmonic complexity is inversely proportional to the ratio between chording and non-chording instruments.

 

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Jim:

 

We need at least "something" to go on about price. MAP price or retail price, or both. A review about a product that has no price is not all that helpful.

 

There are a lot more dealers selling instruments that really don't know the products. Reason? there's just so many products. Many organ and piano dealers that only sell those products may have a better shot at providing the information a potential customer needs to make a buying decision, but typically, people buy what they believe will serve their needs and what they can afford. (You won't sell a $10,000 organ to a customer that only has $2000 to spend).

 

MI retail chains and even independents that concentrate on fewer product lines have a difficult time having the time and money to be knowledgeable about what they sell. Its probably unrealistic to expect dealers to know all the nuances about all the products they sell. You have to get to the mfg with specific questions, but usually (as db said) they can't help you with integrating products from various mfg's. Quite a problem.

 

I found out recently that Yamaha changed their dealer agreements that states "If you sell it, you service it". So if you buy something on the Internet, you have to send it back to the place you bought it OR to a Yamaha Service Center if there's a warranty issue. Local dealers that you didn't buy it from don't/won't service it under warranty. That should even the playing field a little.

 

Mike T.

 

 

Yamaha Motif ES8, Alesis Ion, Prophet 5 Rev 3.2, 1979 Rhodes Mark 1 Suitcase 73 Piano, Arp Odyssey Md III, Roland R-70 Drum Machine, Digitech Vocalist Live Pro. Roland Boss Chorus Ensemble CE-1.

 

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Jim:

 

We need at least "something" to go on about price. MAP price or retail price, or both. A review about a product that has no price is not all that helpful.

 

 

Mike T,

 

Ah...Jim stepped out for a smoke. In Internet years, this thread is prehistoric.

 

Busch.

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Oh, I don't know Busch. I don't look at every instrument known to mankind to see how much it is. There are times when KB reviews a product I'm not familiar with and I read the review to see what its about. It should have a price on the review.

 

Mike T.

Yamaha Motif ES8, Alesis Ion, Prophet 5 Rev 3.2, 1979 Rhodes Mark 1 Suitcase 73 Piano, Arp Odyssey Md III, Roland R-70 Drum Machine, Digitech Vocalist Live Pro. Roland Boss Chorus Ensemble CE-1.

 

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On the price tag of the shirts, however, was not only the store's price ($35) but also a line that at one point said "Sold Elsewhere for $60" and later said "Compare at $60." Now, these were "Today's Man" label shirts! By definition, these shirts weren't "sold elsewhere," and although I knew what they meant by the additional line on their price tag (e.g., comparable quality of material, construction, etc. would cost you $60 at some other store), I always got a chuckle out of those labels.

 

Noah

 

How about the Mattress industry/retail chain for that stuff?

They all have price 'protection' and comparisons, but every chain has matresses made in the same factories whith the same stuff, but with minor differences in features and different names. So there is no effective way to call them on their price comparisons!

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Busch, yeah I didn't see the date of the original thread until later. Oh well, I've been wrong before and that won't change any time soon.

 

Mike T.

Yamaha Motif ES8, Alesis Ion, Prophet 5 Rev 3.2, 1979 Rhodes Mark 1 Suitcase 73 Piano, Arp Odyssey Md III, Roland R-70 Drum Machine, Digitech Vocalist Live Pro. Roland Boss Chorus Ensemble CE-1.

 

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