Towards a more discerning buyer

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SummaryElectronics industry thrives on regular product replacement cycles to keep accountants and shareholders happy.

The true value of any product and its cost structure is wrapped in layers behind different overheads, input costs and multiple taxes added from manufacturing to retail

Electronics industry thrives on regular product replacement cycles to keep accountants and shareholders happy. To achieve this, they build economies of scale backed by marketing buzz and hype. The target audience is fragmented, with short attention spans, making it difficult to sustain a lasting impact. Viral marketing creates a felt demand for a product by altering cognitive states. One attributed to Steve Jobs was called as “reality distortion field”.

Rapid strides in psychometric tests and understanding of neuro physiological phenomenon with complex mathematical metrics have helped to measure advertising impact on a user. Apart from conventional media, interwebs with dedicated “tech reviewers” have spawned SEO spam. Analysts with dubious and questionable merit “quantify” millions of shipped products (but not actual sold numbers); to create a positive spin; unfortunately their underlying financial disclosures are often not stated.

Apple occupies top of mind recall and remains aspirational for a cross section of populace with access to resources. It scripted a “rags to riches” story and “path breaking” product hype was created either by selective leaks or engineered shortages. However unknown to many, it has been under cloud for shifting manufacturing jobs and tax evasion, labour issues at Foxconn and ripping away various innovations to pass them as it’s own. Jobs marketed himself as a detail obsessed maniac which rubbed off on the sales as buyers justified forking out premium for his antics.

Similarly, Samsung has been selling phones under “Galaxy series” with refreshed models over regular intervals. They have stock Android with proprietary Touch Wiz interface which this reviewer finds ugly and repulsive. Unknown to many, Samsung supplies critical parts to it’s closest rival, iPhone despite fighting pitched patent battles in courts.

The true value of any product and cost structure is wrapped in layers behind different overheads, input costs and multiple taxes added from manufacturing to retail. The final pricing is determined, in part, by end customer who pays for perceived value of brand attributed majorly to clever marketing aimed at recall value. It is incredibly cheap to yank out new products based on blue prints ever since China became the manufacturing hub, partly due to cheap labour and ineffectual legislation. Aakash, the “cheapest” tablet, has benefited from Chinese manufacturing with generous doses of Indian taxpayers money to subsidise

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