High end vs internet

I feel compeled here to speak on several points mentioned here, if for nothing, because I've worked in the high end A/v business for many years, and know first hand what the internet has done to change hi-end...
Yes, it's true, the internet has caused some major changes to occure in retail hi-end audio sales by-enlarge. But hi-end will NEVER DIE ON A RETAIL LEVEL!....GARANTEED! As long as the "smart" retailers of Hi-end focus on SERVICE...THE HI-END WILL SURVIVE IN MY OPPINION!..that, and if hi-end manufacturers continue to keep internet sales under control.
Indeed, a lot of the mass market mid-fi products have hurt Hi-end retailers quite a bit. But the ones that mostly deal in "exclussive", "non-internet" sold products, are still selling hi-end I think! Still, most of the retailers I've talked to say that "custom installation is keeping us a live!" And for now, I can certainly see people want to ride the "new and exciting wave of internet purchasing fun", at least for now. So, I think hi-end retailers have had to refocus..and I think that's VERY GOOD FOR HI-END IF YOU ASK ME!! Why?...because hi-end retailers should no be forced to focus more on something you'll never get by shopping "on-line", and that's SERVICE!!!!!
I really actually feel sorry for the masses that are duped into thinking they are saving money, and getting the best gear cheap, and getting great Hi-end sound!!!!...JOKE!!!!
I GARANTEE that everyone who simply reads magazine articles and reviews on products, and buys em on-line because it's cheaper, is ending up WITH LESS THAN STELLAR QUALITY AND END RESULTS!!!!....GARANTEED! Why I think the high end will never die at the retail level, is that YOU CANNOT REPLACE SERVICE!!!!..and there is really no service on-line!
I personally think this "net-thing" has lowered the overall quality that people are ending up with! You can't replace what a knowledgeable, skilled, and experienced hi-end salon has to offer in general! Some of us guy's have been pouring "blood, sweat, and tears" into finding out how to put together higher fidelity audio/visual experiences, and you can't replace that buy simply buying "potentially excellent gear somewhere" And I know that if you buy a pair of speakers from me at a retail shop vs. if you buy em on line and hook em up yourself at home. 999/1000 times buying em from me is going to yield you a FAR BETTER SONIC EXPERIENCE, because I can be there for you to give you the sevice and advice and experience that's going to get those sepakers sounding FANTASTIC for your system/set up!!!! I mean, I know FOR A FACT that I'm going to be able to help you set it all up and make the right chioces better than ANY AUDIO NEWBIE, AND 99.99% OF the experienced audio junkies!!!!
So, if I was a retailer, whould I sweat the internet any??...NOT A CHANCE!!! Because I'n going to be there for my customer, stand behind the products, offer WORLD CLASS SYSTEM SET UP, DESIGN(IF APPLICABLE), INSTALLATION, ADIVCE, CALIBRATION, and proper matching equipment and recommendations THAT I KNOW WORK!!!!...or I'll change it out for you!!!...THAT'S MY THINKING!
So, I guess someone could get all worked up over buying their Mark Levinson amp on Ebay or whatever. But I think, if I was a retailer still, I could care less if my customer decided to do the "net-thing"! Because I know, in the end, he's LOOSING OUT BIG TIME!!! He may end up with a potentially great piece of gear for cheaper(maybe not the right gear, as reviews are no way to make decisions), but he won't be getting a WORLD CLASS audio experience likely...from my experience that is!
So, for me, I think SERVICE HAS TO BE WHERE IT'S AT! The gear is only SECONDARY. I mean the gear is only half the equasion. And usually people who rely on buying things cheap over the net, end up short! NOt to mention the other draw backs of "internet buying"! (too many "uncertains")
So, In short, I think the reason internet sales havn't "BOOMED" QUITE LIKE THEY WERE EXPECTED TO, IS THAT PEOPLE STILL NEED SERVICE! ...and the net can't provide it!

Audiogon thrives because USED HIGH END GEAR HAS GOOD RESALE VALUE and the internet provides a community of customers clamoring to get in the door so they can compete to buy.

Audiogon has cut deeply into price-fixing practices. Thank God.

Flex, I realize that most high end stores can not live with a 10%-15% markeup on most of their items.... HOWEVER, there is a big difference between marking up a $3k item 40% and marking up a $30k item 40%. That difference is 10 fold.

My point is that high ends stores whould be a bit more flexible on price on very high ticket items they sell. It would only help move equipment. Requiring a 30-40% markup on a $30k piece of gear is a bit insane when a 10-15% markeup would seal many more sales.

KF

The internet has increased the circulation of equipment to the point where you don't have to go on an adventure to find used gear. Once the domain of dealers who would mark up used gear, the market has turned into the individual seller and buyer and the internet has circulated the information on what's available, effectively elbowing aside the dealers in this market. In addition, and most important IMO, is that the exchange of first-hand information from us grunts in the trenches really has shed a light on audio products that you would never get from a dealer - instead you would have to rely mostly on audio publications, which themselves are problematic (another topic altogether).

Not only that, but new entrants into high end audio, such as Supratek and Teres, have taken advantage of the word-of-mouth power of the internet to suucessfully sell their products at a lower cost by bypassing the dealer network. So, yes, it may be hurting the High End dealerships - but how many of us are willing to forego information or pay more than we have to?

This is a touchy subject, and as a manufacturer very important one to our company. I think the internet and sites like audiogon have increased high end audio. It increases awareness and education in high end audio--both very good for the industry as a whole. It is clear it has changed business and allowed users to find "bargains" be it new or used. If I can stereotype dealers there are really three types (of course one dealer may employ multiple types within their business strategy).

One is the mail order/ internet company that strongly pursues these types of sales. The service is from afar so it not as time consuming as going to someone's house and setting up a system. It also doesn't have the overhead of a first rate showroom. Thus this is less expensive and as a result they can pass the savings on to the customer.

Then there are the traditional brick and morter shops that have high end gear on display, expect people to listen and then buy. Many of these shops have really suffered from the internet. I think largely due to the fact that someone will go to their showroom, listen, decide what they like and then try to cut a better deal through the internet. To me this is really unethical to take a salesperson's time and basically "use" the facility as a testing ground with no intentions of buying from a place that has to sell at margins to support their sales force and building. This has been discussed in previous threads, so I won't beat a dead horse.

The third is what I call the "CEDIA" dealer. These dealers may or may not have a showroom. They are generally small but offer customer and installation services that can make a complex HT and music around the house easy enough for the whole family to use. These may or may not be high end dealers, but more and more often they are. As an example, Madrigal, has made the statement CEDIA is our show--it's no longer CES. That's a pretty strong statement from a high end manufacturer that has hundreds of brick and morter outlets and certainly let's you know what they think the longevity of the traditional brick and morter is.

I believe the traditional brick and morter has to diversify into one of the other two segments in order to remain profitable and stay in business. They either need to set themselves apart with customer service that is exceptional in their area or they need to get into the internet/mail order business. (It's even possible to do both--but I think that's a difficult business model).

Specific to our company is a variety of services and components sold through a dealer network. All of these require the presence of the dealer in the customer's home to either calibrate the device or take acoustical and physical measurements of the customer's listening room. Therefore an internet/mail order type dealer does us little or no good. They do not provide value to us, nor to our customers. We do have a variety of dealers that are the CEDIA type and the brick and morter. A few of our dealers do pursue internet sales, but not with our products and services because it's impossible for them to meet the requirements of installation and acoustical measurement.