Paul Jacobs, President and COO of Klipsch Group, Inc.
I have often pondered this question. After all, when reflecting back on bygone eras - with the added wisdom that comes with experience - poor business decisions, missed opportunities and reluctance to change are all very obvious. But are things always as obvious as they seem in real time?
Consider these questions:
- When was it clear that the age of the horse-drawn wagon was dead, certainly not with the first automobile, as it was met with great pessimism?
- When was it clear that mass train travel as a primary mode of transportation was dead, certainly not with the first airplane?
- When was it clear that the local, family-owned grocery store was dead, having been replaced by mega stores?
I’m sure you get the picture, and, of course, these kinds of questions are endless, but have you thought how they might apply to your business today?
Given that my experience lies in the audio industry, here are the questions I’ve asked myself as Klipsch moves in to the future.
- When was it clear a computer company would change how music was consumed? (Not just any company, but a very niche company with little market share.)
- When was it clear that the traditional way of distributing music, from label to retail, would be turned upside down with artists cutting deals directly with single mega non-music retail partners? For example, Paul McCartney selling an album exclusively at Starbucks, a coffee retail chain that bypasses all traditional methods.
- When was it clear that the masses stopped caring about music listening as a social experience and valued personal listening far more?
Today, the audio industry, as a whole, must overcome untold obstacles in order to maintain a successful position with both retailers and customers.
In the not so distant past, local and regional specialists sold high-performance audio, marketing themselves as the brands they represented and assuring consumers their storefronts sold the best possible products. This “push” mentality, which worked for many years, required highly trained sales professionals, manufacturers agreeing to limited distribution, and charging premium prices for the products as well as the mystique that comes with being a discerning customer.
This mentality, however, doesn’t apply at all today because lower performance products are being touted as “the solution,” with their good looks and quick installation. Plus, we’re dealing with the Internet and people buying multi-thousand dollar systems without hearing them first.
But those aren’t the only concerns plaguing the audio industry. We also need to ask ourselves: How does new technology, including wireless, play into the future? What will Hollywood and the record labels do about future content distribution? Will we continue toward compressed audio or will content reproduction quality become important to the masses? Will housing starts ever rebound to anything resembling the pre-meltdown levels? How will the global markets respond to new technologies? How will green initiatives impact the CE industry?
These are a lot of things to ponder. To me, it seems we have had a transformative change not just in global economies, but in the CE industry, too. In fact, I would argue that we’ve seen the end of an era in terms of how high-performance audio is bought and sold. So what will the new era look like?
At Klipsch Group, Inc., parent company for the Klipsch, Jamo, Mirage and Energy speaker brands, we believe form factors, proper application of available and understandable technologies, and maintenance of high-performance products will be essential.
While people have to be more cautious of how they spend their money these days, it doesn’t mean they should interpret this as having to buy lower quality items. But having had the privilege of traveling the world these past 15 years, it’s obvious the United States has embraced a “throw away” mentality. By this, I mean buying or leasing new cars every year or two, buying and selling houses on a regular basis, and habitually purchasing new computers, cell phones and video games.
Because we, as a country, have started to view consumer electronics as a disposable category, there’s been a rise in cheap, low-quality products. Therefore, it’s time for manufacturers to make a change and stop building “good enough” products.
Consider these questions:
- What if the new era is no longer has a “throw away” mentality? What if people began to value how they feel a year from now or 10?
- What if people start looking at high-quality entertainment products as an investment that will improve the quality of their everyday lives?
- What if people begin to realize they’re harming the environment when they buy a cheap, poor performing product that ends up in the garbage six to 12 months later? These products can last an eternity in a landfill, using up limited and valuable natural resources.
Buying better quality not only yields a better experience, it also means spending far less over time and taking better care of the environment by not throwing items away. Companies that have found success with the “buy cheap and worry about it tomorrow” mentality will suffer greatly if such a change is made, while those of us who believe that value is not about low price, but longevity and memorable experiences, will see significant opportunities in the future.
Yes, I think you can see the end of an era while it’s happening as long as you pay attention and open your mind to things you might not have in the past. While new speakers, flat-panel TVs, computers and smartphones are not necessity products, I know almost everyone would love to have them, and this gives us the great privilege of creating new concepts for a very long time.
I wish you all good luck in this exciting new era!