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Samsung And Sony Strong-Arm Stores

Discussion in 'Off-Topic Discussion' started by CatfishRivers, May 24, 2012.

  1. CatfishRivers

    CatfishRivers Well-Known Member

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    Samsung and Sony Strong-Arm Stores - Forbes (click for full article)

    "Remember when flat screen TVs were really expensive? Not any more. The average price is around $545. And while the prices get smaller, the sets get larger - 38 inches today, up from 33 inches five years ago. Ain't technology grand!


    The TV manufacturers don't think so. Providers like Samsung and Sony are strong-arming retailers to pull back on discounting policies for TVs, and have come up with a new plan that would prevent retailers from advertising or selling TVs for less than a price the manufacturers set. It's a move aimed at increasing profit margins, decreasing on-line competition, and something the manufacturers hope will eradicate "showrooming," a consumer tactic where shoppers check out models in bricks-and-mortar stores, and then buy them for dramatically reduced prices online.


    "Price-fixing,' you say? "No, No," says the Supreme Court. They've ruled manufacturers can set minimum prices at which retailers can advertise a product. Dictating policy about retailer/customer transactions? Maybe. It ends up that the law may be with the manufacturers, but ultimately not the marketplace.


    All this is compounded by the fact that brands - particularly tech products like TVs - have been tough to differentiate in terms of rational equipment characteristics, which is why supporting emotional brand values is so very important, whichever category you're watching. If you can differentiate your offering, you don't have to play the price game, and you probably won't lay awake at night worrying about losing sales to competitors unless you provide low, lower, lowest prices


    When it comes to TVs it doesn't help there haven't been all that many category innovations. We used to look at different types of TVs in our Customer Loyalty Engagement Index, but TVs became so similar we decided to just look at "Flat Screen TVs" as a single category. Here's how the brands rank when it comes to loyalty and engagement:


    Samsung
    Vizio
    Sony
    Insignia
    LG
    Panasonic
    Toshiba
    Hitachi
    Phillips


    There may be plenty to watch on TV these days, but the outlook for the category isn't pretty. The number of TVs sold to retailers is down, as are retail chain earnings. And it turns out not all TV manufacturers are up to enforcing price controls. But until providers learn how to create real emotional engagement, or until retailers can offer consumers products they can't get on-line, comparison-shopping via bricks, clicks, or a mix will continue.


    As they say in the business, "stay tuned."
     
    Last edited: May 24, 2012
  2. CatfishRivers

    CatfishRivers Well-Known Member

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    Sony, Samsung limiting discounts on their HDTVs. An act of desperation? | ZDNet (click for full article)

    "The HDTV industry has been ailing of late, whether it's TV manufacturers dealing with slowing sales or bricks-and-mortar retailers coping with buyers making more purchases online (often after testing sets in their stores). Samsung and Sony have decided to use one weapon in their limited arsenal to cope with the difficult conditions.


    According to the Wall Street Journal, the two electronics giants are limiting retailers' ability to discount their televisions, which should help the Best Buys of the world who often can't match the sale prices of online retailers. And given the general trend of falling prices for sets, the move could help prop up profit margins for the companies.


    In theory, if there are no sale prices for Sony or Samsung sets, you could just buy a new TV while you're at Best Buy instead of checking prices online on your smartphone as you're in the aisles and then buying from the cheapest Internet store. That increasingly common phenomenon known as "showrooming" has been a major reason that Best Buy has struggled recently, despite decent first quarter numbers.


    While legal rulings have determined that manufacturers are in their rights to limit discounting of their products, there is one potential drawback to the strategy: What if people buy fewer Samsung and Sony sets because they're priced too high? LG, for example, told the WSJ that it's okay with such discounting, presumably because it could help its market share. Target has also told TV manufacturers that another way to fight showrooming is to make differentiated products for physical retailers that the Amazons of the online world can't offer.


    Do you agree with Samsung and Sony's gambit that limiting sales on their TVs will help Best Buy and other bricks-and-mortar stores (and their own bottom lines)? Let us know your thoughts in the Comments section below. "
     
  3. CatfishRivers

    CatfishRivers Well-Known Member

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    I wonder if this decision will also apply to Sony's upcoming GTV products? (They are not HDTVs - but rather a GTV set-top box and GTV blu-ray player).

    The prices announced for the Sony GTV products (to launch in September) in Europe - were the equivalent of $266 for the set-top box and $399 for the blu-ray.

    IMO these prices would seem too high for a big marketing success in the USA. Isn't $399 for the GTV blu-ray about the same price as the original Sony GTV blu-ray? I hope I'm wrong and that it's a big success - but those European prices seem very close to the first round of GTV hardware prices - (that failed primarily due to high prices).
     
    Last edited: May 24, 2012

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