September 2017

Price Is No Object
Roger Skoff writes about hi-fi and high prices.
Article By Roger Skoff

  Last month, I attended and spoke at CAS7, the seventh year of the California Audio Show. That was held on July 28, 29, and 30, in Oakland California, near San Francisco, and, although it was of nowhere near the magnitude of, for example, the recent Los Angeles Audio Show ("LAAS"), the overwhelming feeling I got from both the exhibitors and the attendees was that it was appreciated and enjoyed by all, and that they would definitely be there again next year.

My particular role was to speak in two seminars, one being a sort of "Meet the Audio Press" event, with half a dozen or so writers for various publications on stage to answer questions from the audience, and the other was simply an open discussion between myself, John Curl, and however many audiophile attendees.

Interestingly, one of the questions that came up (from different questioners) at both events was the issue of the price of our toys, and in the first one, the questioner specifically cited a recent print magazine article. The gist of which was, apparently, that our industry needs to lower its prices if it ever wants to take back the position it once held in the hearts and wallets of the buying public.

Essentially the same question, although without a certain popular print magazine reference, and phrased from another point of view, came up again at the (frankly much livelier) event involving just me, John Curl, and (with Roger Modjeski, of Music Reference electronics and RAM Tubeworks, and others there as surprise representatives of the professional community) a very interested and active audiophile audience.

Basically, the thought of most people at both events seemed to be that the reason our hobby and industry haven't been attracting more newcomers is that our gear is priced too high for them to afford.

I disagree entirely, and said so. The reason, I said, that people aren't thronging to buy from us is not that our stuff costs too much, but that people simply don't want it enough.

Now don't get me wrong, please, I'm NOT saying that people wouldn't like to have it. It's just that there are other things out there for the same amount of money that they want more, and those are the things they're spending their money on.

Economists know that what determines the price people will pay to buy something isn't just "supply" and "demand", as most people think, but that there's a third factor – the availability of substitutes – that must also be considered.

Any time anybody has money in hand and is looking for what to do with it, he's faced with choices: 

The first is simply, "Should I spend it or save it for a 'rainy day'?". Saving the money is a very real substitute to buying something, and there are a great many people who choose it. The second choice, if the decision is to spend the money, is what to spend it on: For any amount of whatever you have to spend (time, money, effort, etc.) there are always many options available: If we're just talking money, though, and we're talking about a lot of it, the choice isn't just "Should I buy a Lamborghini, a Ferrari, or a McLaren?" it may also be "Should I buy a new house or investment real estate or start a new business?" Or even "Should I buy a new megabuck Hi-Fi system?" The available options include anything at all that can be done or bought with that same amount of money. And if all of the choices are equally likely to produce the same amount of benefit, it will always ultimately come down to just one thing: "What do I want the most?"

Even with lesser amounts, it's still exactly the same; there are always other options, and if, after carefully evaluating all of the costs, risks, and likely benefits, they're all the same, or if there's a "tie" as to which one to go for, the final deciding factor will still always be "Which one do I want the most?"

The basic assumption that our Hi-Fi toys and goodies are too expensive is, I think, fallacious: The fact of it is that – even though there certainly are High-End Hi-Fi systems and components out there that would make even Bill Gates or Warren Buffett think twice (or even three times) before buying them, the truth is that not all Hi-Fi is challengingly (or, depending on how you look at it, impressively) expensive: With less than US$1,000, a person who wants to can put together a complete home music system with a receiver; either a digital or LP sound source; and (as just as one example among many), a pair of the truly remarkable speakers designed by Andrew Jones for ELAC or Pioneer, to provide powerful; emotionally involving; and thoroughly enjoyable sound.

And even an impoverished student or penurious other person who can't afford even that much can still find good sound for cheap on the used market.

It's not the price that's keeping people from joining our hobby and supporting our industry, it's the fact that – except for us audio cognoscenti here in the United States or a growing number of young people in countries around the world newly enjoying economic prosperity – they'd rather spend whatever money they have on something else.

Sales manuals in every industry have, for many years, and taught us allegorically, that "It's not the drill that people want to buy; it's the holes". That's absolutely true, and it's the way it is with everything. 

The problem lies in figuring out what the "holes" are for any particular buyer: The guy who buys the Lamborghini or other fancy car might actually love or be "into" the machinery, but it's also entirely possible that he bought it because spending that much money makes him feel good because it's proof to himself and other people that he can spend that much money. Or it might be that he's simply turned-on by the looks of it; or by his thoughts of what other people might think of it (or of him, for owning it). Or maybe he just hopes it will get pretty ladies to smile at him in a particular way. There's any number of reasons for him to buy it, and neither the fact that it can go 200mph or more (which it's almost certain he'll never do) nor simple transportation – the functional purpose of any car – may be the one that actually gets him to lay out his money.

One thing is certain, though. All the price ever does is to determine the range of competition for his money. Regardless of price, if he has the money, and if he wants it more than he wants any of the other things that he could buy with that much money (including just keeping the money in his pocket) he'll buy it. And if he doesn't want it enough, no matter what it is or how cheap it may be, he'll never buy it.

With Hi-Fi, it's just the same: With our stuff, too, there are lots of reasons why people might buy it: Just on the performance front, for example, we can offer a distinct advantage: A well-selected Hi-Fi system will always, unlike that fancy car, "go 200 miles per hour", delivering, if it's properly set-up, full performance on every recording, at any volume control setting. It can be a joy every time we use it, and just owning it can make us feel good about it and about ourselves, too. It might even be, too, that, with the right music and a little soft lighting, it can help us to get pretty ladies to smile in that special way.

It's not the price that's keeping our hobby from attaining its past glory; it's the fact that the number of available things that can be bought with the same amount of money has grown, and people want those other things more. One of the biggest reasons for that is that people no longer know about what we have to offer, and one of the very best ways of getting new people to be aware of us and of our hobby – and maybe even to get them interested in joining us – is Shows like CAS7, specifically oriented toward attracting newcomers. More and more Hi-Fi Shows seem to leaning in that direction and more and more Shows seem to be popping up all the time. Good! 

Another way to make ourselves and our industry known is something we can all do:

Simply invite one or more non-audiophiles to your home to listen to your system and hear what music really sounds like. Maybe they'll love what they hear and want to join us. Maybe you'll start a whole new audiophile movement. Maybe not. At the very least, you'll...

Enjoy the music.