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It's a combination of factors but the gist of it is that they're not preventing anyone from doing it -- nobody wants to do it because they can't justify it. De
by alxlaz 4y ago
It's a combination of factors but the gist of it is that they're not preventing anyone from doing it -- nobody wants to do it because they can't justify it.
Designing and selling long-lived consumer products is a tremendous effort in terms of regulatory activity and logistics. And if you're just entering the market, you're entering a market where established players have been sitting on standardizing committees, lobbying regulatory bodies, and have had special deals with manufacturers, transporters, TV channels and shopping malls since Jimmy Carter was in the White House, and have been able to leverage them when dealing with online shops since the days of the dotcom boom.
Furthermore, getting that "more of the market share" requires actual first sales to happen in the first place. Selling fewer, better, and inherently more expensive products by claiming that yours are really good and last a long time is not very straightforward at all: it's not like everyone else is openly advertising that they're selling cheap junk that's worse than their 1980s versions in every way except maybe power consumption (because we can make better power supplies now). If you're selling kitchen stoves that last for twenty years, it's gonna be at least seven or eight years before anyone really believes you.
So all this requires tremendous initial investment in a pretty hostile environment. Consumer markets are already perceived as low-yield and under tremendous price pressure. But, worse, some segments -- household appliances in particular -- also suffer from a "marketshare = dead market" problem: if you sold someone a washing machine that lasts fifteen years, you're not going to sell them another one for fifteen years. So if you're selling things that last for fifteen years, you gotta convince the folks whose money you're depending on that you can keep selling things at a reasonable pace for fifteen years from now, and you won't really know if you've succeeded at your basic value proposition ("we make better things that last longer") for at least seven or eight years into it.
That's not just pretty risky, it's on a timeframe that's about an order of magnitude higher than companies/investment funds/people willing to throw that kind of money into things that run on electricity are able to work with.
That's not to say no one has been entering these markets. They have, but they've usually done it through other value propositions -- stuff that's even cheaper, stuff that's ethically sourced and so on. New premium brands do pop up but they either target prosumer/super premium markets (slang for "super rich people who want to brag or impress"), where the rules are slightly different, or go straight for the professional market first, where the rules of the game are very much different, and use whatever reputation they can make there to start selling home appliances too.