The case of Märklin
05/02/09 09:44 Filed in: photographic culture
The Märklin company is the premium manufacturer of model trains. The company is in this business for 150 years (anniversary this year!).This week it went into liquidation. There is some hope it will be saved by a motivated investor, who knows the business.
Märklin produces extremely high quality products, has a strong brand name, a long history, and is increasingly dependent on a small group of loyal/fanatical collectors/buyers.
The company produces exclusively for the high end market, employs about 1000 persons and has a turnover of Euro 130 million. The company failed to attract new customers with innovative products and a much lower price. A new owner could save the company, not with another injection of money, but with that peculiar attribute of Herzblut (being engaged with heart and soul).
The similarity to the Leica brand name and company is very close. In today's world a long tradition, a fine brand name and a loyal customer base is not enough.
The Harley-Davidson is a company that is in trouble too. HD catered, like Märklin and Leica for the high end market with expensive products, but has difficulty persuading the market to buy the product. Luckely for HD, it is Warren Buffett who thinks that there is a market for such products as he invested a substantial amount of money into the company. WB would not WB unless the deal would be a bargain for him.
A company and its products have to match the Zeitgeist. A good example now is Apple. A really bad example is General Motors.
Leica did fit the Zeitgeist admirably in the decades 1920 to 1960. Since that period it has drifted out of synch with the Zeitgeist to become a niche player, like Märklin with cult status.
The reports from the industry are becoming quite sombre: Sony and Panasonic reported a drastic drop in camera sales, Canon hinted at a drop in sales and it is only a matter of time before the rest of the camera industry will feel the cold wind and report this state of affairs. The current crop of cameras can produce any kind of picture you want and there is absolutely no reason to upgrade to the newest model.
The fact that the Leica M8 is heavily discounted is a sign of the times.
People are more and more inclined to buy products that simply do the required job. Expensive notebooks are out and simple netbooks are in. Buy just what you need and pay the least amount of money is the current norm.
It is of course bringing water to the sea to note that Leica needs a cheaper and simpler rangefinder model. The great success of the Canon G10 (even in professional circles) is an indication that a compact and relatively simple camera with good quality can support most requirements.
There is a quiet revival of interest in the Hexar RF, a solid quality film loading camera. Just sitting out the crisis and hoping that the world will return to normal is the surest way to fall off the cliff in the next crisis.
Märklin produces extremely high quality products, has a strong brand name, a long history, and is increasingly dependent on a small group of loyal/fanatical collectors/buyers.
The company produces exclusively for the high end market, employs about 1000 persons and has a turnover of Euro 130 million. The company failed to attract new customers with innovative products and a much lower price. A new owner could save the company, not with another injection of money, but with that peculiar attribute of Herzblut (being engaged with heart and soul).
The similarity to the Leica brand name and company is very close. In today's world a long tradition, a fine brand name and a loyal customer base is not enough.
The Harley-Davidson is a company that is in trouble too. HD catered, like Märklin and Leica for the high end market with expensive products, but has difficulty persuading the market to buy the product. Luckely for HD, it is Warren Buffett who thinks that there is a market for such products as he invested a substantial amount of money into the company. WB would not WB unless the deal would be a bargain for him.
A company and its products have to match the Zeitgeist. A good example now is Apple. A really bad example is General Motors.
Leica did fit the Zeitgeist admirably in the decades 1920 to 1960. Since that period it has drifted out of synch with the Zeitgeist to become a niche player, like Märklin with cult status.
The reports from the industry are becoming quite sombre: Sony and Panasonic reported a drastic drop in camera sales, Canon hinted at a drop in sales and it is only a matter of time before the rest of the camera industry will feel the cold wind and report this state of affairs. The current crop of cameras can produce any kind of picture you want and there is absolutely no reason to upgrade to the newest model.
The fact that the Leica M8 is heavily discounted is a sign of the times.
People are more and more inclined to buy products that simply do the required job. Expensive notebooks are out and simple netbooks are in. Buy just what you need and pay the least amount of money is the current norm.
It is of course bringing water to the sea to note that Leica needs a cheaper and simpler rangefinder model. The great success of the Canon G10 (even in professional circles) is an indication that a compact and relatively simple camera with good quality can support most requirements.
There is a quiet revival of interest in the Hexar RF, a solid quality film loading camera. Just sitting out the crisis and hoping that the world will return to normal is the surest way to fall off the cliff in the next crisis.