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So Apple run a loss-leader... where they don't incur the loss, and just get the lead. Scum.

by 1stop 11y ago

Dylan16807 11y ago
Any definition of loss that says Apple suffers none would also say that the artists suffer none. Likewise, any lead Apple gets here is shared with the artists. This is rude to force on artists without asking, but only because they're not asking. It's not scummy.
- yincrash 11y ago
  Except the loss-leader is being used to steal users from other streaming radio services that _are_ currently paying labels & artists. So any users that switches from Spotify to Apple for example is a user that was paying artists but is now not for 3 months.
logicallee 11y ago
That analogy would apply if the loss got people in the door, but they bought SOMETHING ELSE that ensured profits. For example, in this case if free music got them onto Apple's platform (loss) where they then bought a bunch of apps (unrelated to music and the source of profit). For anyone who doesn't know, a loss leader is something advertised like bread for 50 cents or something, where the store loses money on each and every sale. It's a customer acquisition cost, and the goal of this is to "lead" with the loss, get people in the store, and there they will buy not only bread but anything else they need at the time, at normal market prices. Normal market prices give enough profit to offset the loss taken on the "lead." This works because people don't just go to a store and buy the one marked-down item and nothing else. (Or more specifically the extra profit for people who buy other things after only coming in due to the loss leader, covers the loss on them, and on everyone who only gets the loss leader.)
- 1stop 11y ago
  That's a specific (but common) use of the loss-leader strategy, but not the definition. The strategy itself is to sell something at a loss, to get a lead/marketshare/conversion.
  - logicallee 11y ago
    well, if you type "loss leader" into Google an infobox pops up that says "A loss leader (also leader) is a pricing strategy where a product is sold at a price below its market cost to stimulate other sales of more profitable goods or services" which it got from Wikipedia, whose article doesn't mention what you call the strategy.
    - 1stop 11y ago
      Try typing: define: loss leader

So Apple run a loss-leader... where they don't incur the loss, and just get the lead. Scum.

by 1stop 11y ago

So Apple run a loss-leader... where they don't incur the loss, and just get the lead. Scum.

Any definition of loss that says Apple suffers none would also say that the artists suffer none. Likewise, any lead Apple gets here is shared with the artists. This is rude to force on artists without asking, but only because they're not asking. It's not scummy.

yincrash 11y ago
Except the loss-leader is being used to steal users from other streaming radio services that _are_ currently paying labels & artists. So any users that switches from Spotify to Apple for example is a user that was paying artists but is now not for 3 months.

logicallee 11y ago

That analogy would apply if the loss got people in the door, but they bought SOMETHING ELSE that ensured profits. For example, in this case if free music got them onto Apple's platform (loss) where they then bought a bunch of apps (unrelated to music and the source of profit). For anyone who doesn't know, a loss leader is something advertised like bread for 50 cents or something, where the store loses money on each and every sale. It's a customer acquisition cost, and the goal of this is to "lead" with the loss, get people in the store, and there they will buy not only bread but anything else they need at the time, at normal market prices. Normal market prices give enough profit to offset the loss taken on the "lead." This works because people don't just go to a store and buy the one marked-down item and nothing else. (Or more specifically the extra profit for people who buy other things after only coming in due to the loss leader, covers the loss on them, and on everyone who only gets the loss leader.)

1stop 11y ago
That's a specific (but common) use of the loss-leader strategy, but not the definition. The strategy itself is to sell something at a loss, to get a lead/marketshare/conversion.
- logicallee 11y ago
  well, if you type "loss leader" into Google an infobox pops up that says "A loss leader (also leader) is a pricing strategy where a product is sold at a price below its market cost to stimulate other sales of more profitable goods or services" which it got from Wikipedia, whose article doesn't mention what you call the strategy.
  - 1stop 11y ago
    Try typing: define: loss leader