Micro Four Thirds body deflation

Started May 23, 2013 | Discussions thread
Eamon Hickey
Veteran MemberPosts: 3,169
Like?
yes, the classic early adopter premium strategy
In reply to Mahmoud Mousef, May 25, 2013

Mahmoud Mousef wrote:

MichaelKJ wrote:

Both the V1 and EOS-M were/are sold at greater discounts than any Canikon dSLR that I can recall.

Yes.

I think the problem is Nikon and Canon (and others) want to price these shiny new things too high,

Yep. So far, every mirrorless ILC maker has tried to extract a "new category/early adopter" premium from their mirrorless models. This is a classic paradigm, taught in every business school -- and, as you pointed out, it often works. In a more narrow sense, all these companies have Apple envy; they want to replicate Apple's ability to command very high gross profit margins based on brand and early adopter premiums.

But for the most part, it hasn't worked very well in the mirrorless ILC business. The camera buying public, again for the most part, hasn't been willing to pay the premium, forcing the rampant discounting that all the manufacturers have resorted to.

all the while these things are more-than-likely cheaper to manufacturer than a DSLR (and they can afford to sell them for a lot less than their DSLRs).

At this point in the game, I'm not so sure that mirrorless ILCs are less expensive to build and market, in real terms, than DSLRs, at least DSLRs from Canon and Nikon. It's simply a matter of scale.

Just as one example: Last year, Nikon manufactured more than 6 million DSLRs and Olympus manufactured 600,000 PEN/OM-D mirrorless ILCs. That's a 10:1 ratio, and that gives Nikon tremendous economy of scale cost advantages. (Although, to be sure, some of those advantages would also transfer to Nikon's mirrorless business, so it's not strictly a mirrorless vs. DSLR effect; it's partly a big manufacturer vs. small manufacturer effect.)

Ultimately you're right, of course, mirrorless ILCs should be less expensive to build than DSLRs, but that may not be true until the scale of the two businesses gets closer.

Reply   Reply with quote   Complain
Post (hide subjects)Posted by
Keyboard shortcuts:
FForum PPrevious NNext WNext unread UUpvote SSubscribe RReply QQuote BBookmark post MMy threads
Color scheme? Blue / Yellow