Archived posting to the Leica Users Group, 2009/06/21
[Author Prev] [Author Next] [Thread Prev] [Thread Next] [Author Index] [Topic Index] [Home] [Search]On Jun 21, 2009, at 10:57 AM, Jayanand Govindaraj wrote: > Geoff, > Should we only cheer Leica on a Leica list? Better to open a > Discussion > Forum on DP Review and feel good about it. > > I understand companies, how they are run, and what makes them tick, > its all > I have studied all my working life (35 years). I am judging Leica > without > recourse to the sort of detailed information I would normally look > at, and > without a single look at the financial statements, and without ever > meeting > the management, but here goes. If anyone wants to rebut my analysis, > please > feel free to do so. > > Leica has been a badly managed company I think that most of us here would agree Jayanand...startlingly mismanaged, I'd say...and that's true from way back... a case study of a company that has made and still makes fine, even great products, yet is totally inept in successfully marketing them... eagerly kissing up to the occasional photographer who visits Solms, yet desperately unable to connect with the masses of potential buyers... not knowing or caring how to bring the great photographers of the present and the past who have used their products, into a successful relationship that will translate into financial rewards for the company. amazingly and predictably shrugging at the feeble chit chat here...feeling it's of no use whatsoever to them. I love many of their products, but have total disdain for the company, Steve > (again, I am talking management here, > not products) for some time, that I have no doubt - it was the > dominant > force (in technology as well as volumes) in photography till the > Nikon F > came out, for all of 30 years since the nascent years for small format > photography in the late 1920s. Now their market share should be I > guess > under 1% of total camera sales, and can be comfortably rounded off > to zero. > Leica has been the General Motors of the photography hardware > industry. > Since 1959 they have comfortably missed every new development in their > industry by some distance, tried to catch up, failed and gone to near > bankruptcy; and then someone or the other gets besotted by the brand > goodwill and pumps some more money in. I cant see how much further > this > cycle can go on without the company reinventing itself and its > products in > some other way, or selling itself off. You must understand the > dynamics of > business - you can have the greatest product since sliced bread - > but if you > cant sell it, its worth zilch. Again, just because someone with a > German > name gives a talk, does not mean that he is a good manager, or that > he has a > credible plan and vision - only time will tell. The only thing that > I know > for certain from my experience is company insiders will only divulge > information they want you to know, and will more often than not quite > delibrately withold critical information in order to mislead you. I > never > ever believe what these guys tell me in entirety without cross > checking what > I have been told. For one method on how to do so, let me recommend > one of > the greatest books written on investment, Philip Fisher's "Common > Stocks, > Uncommon Profits". > > The recent announcements on the rationalisation of lines is typical > of a > company running out of cash. Their core market for the M line should > be > contracting at this point of time, the R line is dead and gone and > the S > line is still some time away. The fundamental requirement right now > is to > augment cash flow, and by inference profits, so investments can > continue in > what is now an extremely competitive marketplace for digital > imaging, and at > all levels. Leica's intellectual property and goodwill is primarily > in two > areas - the M system, and its lenses, both the M and R lines. In > order to > survive, it needs to monetise this knowhow better. So IMHO they have > to do > two things: > > 1. Introduce a starter Digital M kit with an EVF at a relatively > affordable > price (plastic is fine, micro 4/3 is fine!) to draw customers into the > system - and please, not a rebadged Lumix body at twice the price > for the > privilege of having a red dot! I say EVF because I presume a major > part of > the cost of M bodies is the rangefinder. This will bring in some > customers > who might otherwise buy a Lumix G1 or the new Olympus. Note that > Panasonic > themselves are offering company branded M and R lens adaptors, so > there is a > market here. > > 2. Like Zeiss, start issuing their legendary, nonpareil lenses in > Canon/Nikon/M42 mounts. As the S series is going to be the > centrepiece from > now on, issuing the R lenses in these mounts will just mean > monetising a > dead horse, with huge margins (no development/R&D costs to > amortise). All > they have to do is an in house Leitax operation on all existing > stocks of R > lenses to start with. I can definitely see lenses like the 100mm > APO-Macro-Elmarit selling very well to Canon or Nikon users, because > manual > focus is what you need for macro. Further manufacture could be sub > contracted to someone like Cosina, with the QC in Leica's hands, in > order to > control costs. > > Please feel free to point out any fallacies in my thinking or > anything I > might have missed out. > > Again, I am making it clear that I am taking potshots at the way > Leica has > been managed as a company, and not at the products! > > Cheers > Jayanand > > > > > > On Sun, Jun 21, 2009 at 11:02 AM, Geoff Hopkinson <hopsternew at gmail.com > >wrote: > >> Jayanand I feel defensive about Leica and the M8 because I am >> enthusiastic >> about both and frequently see your posts and approach to both as >> negative. >> I can never understand that on a Leica list. Sorry, I just don't >> get it. >> Shooting and socialising with more than a hundred Leica enthusiasts >> over a >> couple of days in Germany I saw a lot of keen photographers >> enjoying their >> equipment. No investment bankers although there was a least one >> dentist >> ;-) >> I met a number of Leica staff from division heads and down and they >> were >> without exception extraordinarily helpful and friendly. Looking at >> their >> operation, people and facilities up close you can appreciate more >> just why >> the lenses cost so much, for example. As you know I think they are >> worth >> it. I want them to be around into the future too. I listened to >> Stefan >> Daniel provide much candid insight about the state of business for >> Leica, >> some of which I shared here. Leica needs the support of users. >> When you are as enthusiastic and committed as I am sometimes the >> constant >> criticism or armchair CEO advice on the web forums gets frustrating. >> >> Never mind I'll say no more and we'll continue to continue to have >> polar >> opposite but amicable views on Leica and Adobe and Nikon and no >> doubt much >> else besides ;-) >> . >> 2009/6/21 Jayanand Govindaraj <jayanand at gmail.com> >> >>> Geoff, >>> It is not some, but most of the sales have gone to folks who would >>> use an >>> M8 >>> as a fashion accessory. The real users buy most of their Leica kit >>> used, >>> which is of no use to Leica, the company. The M8 in its early days >>> was an >>> exception, but recently most of the messages on this list on this >>> subject >>> are about buying it used, or about alternatives from Panasonic and >> Olympus. >>> The fact is that Leica is marketing into a certain segment of >>> society >> which >>> is in difficulty now because of the economic crisis, so the S2 >>> targeted >> at >>> professionals may be a good idea after all. Much better than >>> bringing out >> a >>> R10 which will sell in miniscule numbers. At least the numbers >>> that the >> S2 >>> will sell at would bring in much larger margins. Whatever we may >>> think, >>> volumes do count! The D5000 is far more important than the D3x for >>> Nikon >>> from a company health and profitability point of view. I also >>> think that >>> Leica have screwed up big time by not bringing in a less expensive M >>> camera, >>> maybe with an EVF, and not following Zeiss' example of offering >>> their >>> legendary lenses in Nikon/Canon/M42 mounts. If the M is not >>> central to >>> their >>> future, as it seems right now, they might as well maximise the >>> revenue >> from >>> their main intellectual property, i.e. the lens designs for the M >>> and R >>> lines. All in all, Leica seems to be a confused company right now, >>> and >> not >>> a >>> very well managed one at that. Pity. >>> >>> I do not know why calling an item a rich man's plaything has such >> negative >>> connotations. It certainly does not reflect on the quality of the >>> item, >> or >>> the user. I have expensive watches, use only bespoke clothing, >>> etc. etc. >>> which are all extravagances, and I am unapologetic about it. I >>> bought a >>> Nikkor 200-400 lens, which for an amateur is an extravagance, too. I >> don't >>> drive expensive cars because that is not my scene, and I get no >>> pleasure >>> from it. Why don't you just enjoy the M8 instead of getting >>> defensive >>> about it every time? Accept it in your mind that it is your >>> indulgence, >> and >>> that is it! >>> >>> I am debating between the M8 and G1 because, for me, it would be >>> very >> much >>> a >>> secondary system to my Nikon kit and spending a load of cash into >>> a body >>> that will not be used very much seems a waste - better buy a D700 >> instead. >>> I >>> was all prepared to buy a M9 when it came out, with all issues >>> sorted out >>> (like the necessity of using an IR filter, which in hot, humid, >>> dusty >>> climates like ours is a PITA), but now it looks as if it might not >>> come >> for >>> quite some time, if at all. Hence the quandary. >>> >>> Cheers >>> Jayanand >>> >>> >>> On Sun, Jun 21, 2009 at 8:58 AM, Geoff Hopkinson <hopsternew at gmail.com >>>> wrote: >>> >>>> Some folks with lots of spare funds might buy Leica because it is >> stylish >>>> or >>>> elegant or higher status or whatever. Good for them. It helps Leica >> which >>>> helps other users too. Who knows, some of your investment bankers >>>> may >>> shoot >>>> with their new cameras and get addicted. >>>> Keen enthusiasts will find the money or build their outfits as >>>> they can >>> and >>>> choose Leica for the reasons we choose Leica. >>>> Point of interest. The Summilux 50 ASPH. outsells the much >>>> cheaper and >>>> still by all accounts excellent Summarit 50 by 2:1 >>>> Why would that be? >>>> >>>> 2009/6/21 Jayanand Govindaraj <jayanand at gmail.com> >>>> >>>>> Douglas, >>>>> This has been evident for years now. They have been targeting rich >>>>> investment bankers and their ilk, not you and me. It became quite >>> obvious >>>>> with the M8 advertising campaign, which was far more prominent >>>>> in the >>>>> GQ/Esquire type magazines rather than hardcore photography >>>>> magazines. >>> It >>>>> was >>>>> also heavily featured in the "fashion tech" pages (alongside the >>>> Ipod,etc) >>>>> of those magazines. But if truth be told, the bankers would buy >>>>> new, >>> and >>>> we >>>>> would buy second hand... >>>>> Cheers >>>>> Jayanand >>>>> >>>>> >>>>> On Sun, Jun 21, 2009 at 3:50 AM, Douglas Sharp <douglas.sharp at gmx.de >>> >>>>> wrote: >>>>> >>>>>> I was looking up things Leica on the Web recently and noticed the >>>> number >>>>> of >>>>>> hits that turn up for Leica on "lifestyle" pages. >>>>>> >>>>>> It didn't seem to work after their flutter with Hermes, but now >> they >>>> seem >>>>>> to have got their products prominently "placed", or even >> "positioned" >>>> (in >>>>>> the words of the world of marketing) >>>>>> >>>>>> No more mention of precision optics and superb engineering - it's >> all >>>>>> turned into up-market hype about the special finish, how they >>>>>> look >>> and >>>> if >>>>>> they have a perfectly matching bag... everything in black, white, >>> olive >>>>>> green, titanium and silver seems to be the name of the game. >>>>>> >>>>>> >>>>>> The opening of the new Leica Shop in Moscow's uppest-market >>> residential >>>>> and >>>>>> shopping quarter at the end of May seems to be following the same >>>> trend. >>>>> I >>>>>> wouldn't be surprised to find cameras in gold and royal blue >>>>>> with a >>>>> double >>>>>> eagle or in Faberge enamel soon, packed in a matching Faberge >> easter >>>> egg. >>>>>> >>>>>> Then Ferrari red, Bugatti blue, Mercedes silver and, and, >>> and......... >>>>>> >>>>>> The higher prices are obviously already a unique and exclusive >>> selling >>>>>> point for people who want to be seen with a Leica as a lifestyle >>>>> accessory. >>>>>> >>>>>> The M8 Safari is almost sold out, the White Edition has gone >>>> completely, >>>>> a >>>>>> D-Lux 4 Titan and a D-Lux 4 Safari are selling well. >>>>>> >>>>>> This is all very good for Leica, but I think it bodes ill for the >>>> former >>>>>> target group to which we all most probably belong. >>>>>> >>>>>> >>>>>> Cheers >>>>>> Douglas >>>>>> >>>>>> >>>>>> >>>>>> >>>>>> _______________________________________________ >>>>>> Leica Users Group. >>>>>> See http://leica-users.org/mailman/listinfo/lug for more >> information >>>>>> >>>>> >>>>> _______________________________________________ >>>>> Leica Users Group. >>>>> See http://leica-users.org/mailman/listinfo/lug for more >>>>> information >>>>> >>>> >>>> >>>> >>>> -- >>>> Cheers >>>> Geoff >>>> 'Life's not B&W, except at both ends' >>>> http://gallery.leica-users.org/v/gh/ >>>> http://www.pbase.com/hoppyman >>>> >>>> _______________________________________________ >>>> Leica Users Group. >>>> See http://leica-users.org/mailman/listinfo/lug for more >>>> information >>>> >>> >>> _______________________________________________ >>> Leica Users Group. >>> See http://leica-users.org/mailman/listinfo/lug for more information >>> >> >> >> >> -- >> Cheers >> Geoff >> 'Life's not B&W, except at both ends' >> http://gallery.leica-users.org/v/gh/ >> http://www.pbase.com/hoppyman >> >> _______________________________________________ >> Leica Users Group. >> See http://leica-users.org/mailman/listinfo/lug for more information >> > > _______________________________________________ > Leica Users Group. > See http://leica-users.org/mailman/listinfo/lug for more information