Re: Comments please

Date: Mon Mar 12 2001 - 05:42:54 PST

In a message dated 3/9/2001 6:17:27 PM, jkay@ENGENIA.COM writes:

> Promotion probably becomes
>highly digital and the costs drop there also.
Some of those marketing costs are shelf headers and end caps and other
physical marketing devices and might diminish--but lre likely to be replaced
by other kinds of efforts. (Retail stores aren't going away. Their inventory
will. But you might well go into a Virgin Megastore to be confronted by all
kinds of marketing and promotion gizmos--then get your CD burned on the
spot.) Other costs are advertising and payola to disk jockeys and won't go
away. There might be some new costs-- links etc. Marketing costs are as
resistent to elimination as middle-class entitlement programs, so don't count
your chickens.

The big savings are in inventory and in transferring direct manufaturing cost
to the consumer. The big question is how much of this can these guys keep and
how much will be passed on as consumer surplus.


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