Is it possible for a high end manufacturer to overprice their goods?


Having just read the interesting and hyperbole laden review by RH of the new Rockport Orion speakers in the latest issue of The Absolute Sound, one thing struck me..

is it possible in the high end for a manufacturer to overprice their product ( doesn’t have to be a speaker, but this example comes to mind)? I ask this, as the Orion is priced at $133k! Yes,a price that would probably make 99% of hobbyists squirm. Yet, the speaker now joins a number of competitors that are in the $100k realm. 
To that, this particular speaker stands just 50.3” tall and is just 14.3” wide…with one 13” woofer, one 7” midrange and a 1.25” beryllium dome ( which these days is nothing special at all…and could potentially lead to the nasties of beryllium bite).

The question is…given this speakers design and parts, which may or may not be SOTA, is it possible that this is just another overpriced product that will not sell, or is it like others, correctly priced for its target market? Thoughts…

128x128daveyf

Showing 2 responses by bigtwin

There will always be consumers who believe the more expensive something is, the better it is, or simply want the bragging rights to having paid the most for something.  And so long as there are people with more money than they can spend in 100 lifetimes (Elon and Jeff B. come to mind), there will be a small market for $500,000 speakers etc...  Are they worth it?  Doesn't matter.  

In discussions with a retailer I respect, and talking about Focal speakers, he told be the mark-up was 100% at every step.  Focal Sopra 2 cost $6500 to build.  His cost from Focal was $13,000.  His list price (CDN) was $26,000.  Expected discount off list was 20% leaving him with a 30% margin on the sale.  I have no reason to believe this formula does not prevail regardless of the cost.  Bottom line, the higher you climb up the MSRP, the bigger the profits are built in at every step.  It's just a fact of life and no one is forcing any of us to buy anything we don't want.