Archived posting to the Leica Users Group, 1998/02/14

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Subject: [Leica] M7 should be CLE
From: Mike Johnston <70007.3477@compuserve.com>
Date: Sat, 14 Feb 1998 11:26:55 -0500

>>>I'd buy a newly-minted CLE in a microsecond - - provided the QC problens
are overcome.<<<

 George,
 I'd buy two. The CLE is the camera I really need. It's just that I simply
refuse to pay up to $1,000 for a 15-year-old sample. (Leica should be learning
a lesson from the ridiculously high used prices of the CLE, however.)
 They don't even really have to change anything, from my standpoint. Just
reissue the darned thing.
 Also, I agree with whoever said that the CLE is a better camera than the CL.
I'd even pay $1,000 for one, as long as it was new and had no QC problems.

 As far as Art's critique of my economic arguments, note that I umbrellaed my
comments by saying "we don't know." But it certainly is not impossible that the
scenario Stephen Gandy and I are positing might be true. I'll venture the
following points, again umbrellaed by the fact that neither I nor anyone else
knows the real truth:

 --If the major appeal of the whole product line is the lenses, and the only
body the lenses will fit on is the $2,000 M6, then cutomers must buy the M6 in
order to use the lenses. This surely "forces" some M6 sales from people who
would choose to buy a cheaper body if one were available.
 --The CL and CLE were being made by Minolta. The M6 was being made in Wetzlar.
It doesn't stretch credibility to my mind to imagine a disadvantage to Wetzlar
if the CL and CLE were selling well.
 --The CL and CLE were not made for the whole Leitz lens line. They had their
own budget lenses. If the CL/E takes off in popularity, what does that do to
sales of the Leitz lenses not intended for it?
 --Finally, from a pure economic standpoint, generalizations are shaky and
suspect. What follows is a hypothetical example. Imagine you've got a premium
model that sells for $2,000, and half of that is profit. You've got a budget
model that sells for $500, and 1/5th of that, or $100, is profit. That means
you've got to sell 10 of the budget models to make the same profit you make
when you sell 1 of the premium models. You say you can just "raise the price of
the hot-selling item," but that doesn't work either--to make the same level of
profit, the budget model would have to sell for $1,400--and it might not sell
at all at that price-point. In fact, it might not be a good seller at _half_
that. Positing an imaginary price of $500, you might kill sales just by raising
the price to $700. What is all the good SLRs all cost $600? It depends on what
else is available from other companies that the $500 model is competing with.
 Again, we don't know. But saying that a company would never kill a
good-selling product just doesn't take into account many factors that may have
well been true of the CL/E.

 --Mike

Again, apologies for the fact that this doesn't have a subject line. My offline
reader does not give me an easy way to change the subject line in a reply.