Rather than plunging straight into e-commerce, Neodio is taking a different route. The company's support products and cables will be available online, but the electronics will be sold through dealers (domestic and international, with whom Neodio will deal directly) or through two showrooms: one run by Neodio near Bordeaux; the other by speaker manufacturer Kelinac, another company that has decided to follow the same path, located near Paris. Despite a reduced margin, Stéphane Even says that no dealer in France has so far opted to close their account. All of which is interesting, in an academic, changing-face-of-the-business sort of way, until you stop to consider how it impacts end users -- and that’s biggest news here. The Neodio Origine S2, a player that used to sell in France for €35,000, will henceforth cost €15,000 within the Euro zone, including sales tax, and €13,750 plus tax outside. Same machine, same stellar performance, but less than half the price. What’s not to like? Well, for international buyers, there’s the potential loss of local service and support, so repairs may necessitate sending a unit back to France, but that may have been the case anyway. The main change, other than the plummeting price, would seem to be the manufacturer shouldering responsibilities for reviews, promotion and advertising that were previously the distributor’s remit. Assuming that the manufacturer has done the sums regarding costs, the shorter supply route might actually deliver quicker and more direct service, both to press and customers. Traditionally, companies choosing to sell direct are generally assumed to be on the brink of collapse, with migration to a web-only presence a case of necessity rather than choice -- and definitely not principle. But that’s not the case here. What makes Neodio’s decision so interesting is that this is a company that’s actually going places, with well-regarded products and an international reputation. With the prices of high-end audio equipment spiraling not
just out of reach but out of sight, Neodio’s decision is a fascinating one,
representing not just an aggressive marketing initiative but a potential new paradigm and
possible lifeline for small-scale, high-end manufacturers. It’s a path that has been
long discussed. The question is whether those companies that take the first few steps
along it also represent the first cracks in a dam that’s just waiting to burst. |
rench
manufacturer Neodio has announced its intention to dispense with the traditional
distribution model and the high prices that result from its three-tier structure. In the
opinion of Neodio’s frustrated owner, Stéphane Even, such pricing has undermined
sales of his products and limited the number of people able to enjoy their performance.