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Bang & Olufsen in 2019... Your predictions?

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9 LEE
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9 LEE Posted: Tue, Jan 1 2019 1:17 PM

So... with the share price crashing, very few new products (waves of new colours, yes..) and an apparent exit from previously held markets such as Aus/NZ and USA, all combined with a general dissatisfaction of customer service - and the shift from the 'plastic' Play products becoming 'main brand' Bang & Olufsen branded items, where do you see things going from here?

More store closures?  The brand sliding even further into becoming just another 'Beats' with a few flagship products to add a bit of Kudos (if anyone even notices, because there aren't any stores to see them in anyway..) - or do you think B&O has hit the bottom and is now ready to bounce back up?

Financially, B&O have been selling off assets and (to the layman) have been doing this just to keep on trading. Then, the Play products have given them the margin they need.. at the expense of the good name. 

Review sites are littered with '1 Star' bad experiences, we have a negative tone on BeoWorld, and the brand seems to have become totally irrelevant to anyone under 30.  Is this the "burning of the fields" allowing B&O to start from a clean slate, or has the brand name been damaged beyond repair?

Some people on here may think B&O has never been in a stronger position. The brand is bigger than it ever has been, and the products are vastly superior to anything ever made before - and the company is ready to conquer the world from the strongest possible platform.  

If you do think the above, then I'm happy for you.  For all the other people - what do you see for B&O in 2019?  Do you even care enough to post?!

Lee

Puncher
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Puncher replied on Tue, Jan 1 2019 1:28 PM

My fear is that they will end up licensing their entire product range and become just a brand with no real substance.

Ban boring signatures!

Barry Santini
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My main metric to keep on caring about my beloved B&O is:

“Is Geoff Martin still on board?”

Then, I care.

B
9 LEE
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9 LEE replied on Tue, Jan 1 2019 2:27 PM

Barry Santini:
My main metric to keep on caring about my beloved B&O is:

“Is Geoff Martin still on board?”

I've always maintained he should be the CEO.  He's thinks he's not that kind of person as he's very humble - but he'd have the journalistic press eating out of his hands. Great guy, incredibly technical and knowledgable, and also very sensible. 

 

Klaus Nielsen
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Harman/Samsung will buy control and they will become just a brand with no real substance. 

Puncher
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Puncher replied on Tue, Jan 1 2019 2:55 PM

Klaus Nielsen:

Harman/Samsung will buy control and they will become just a brand with no real substance. 

After I posted I thought I should have added this alternative but didn't get round to editing my post!

Ban boring signatures!

Klaus Nielsen
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Harman know a thing or two when it comes to milking a brand. Extreme short term profit is the name of this game. They will stick the B&O logo to what ever. Just look to the automotive “products” from Harman B&O that started out in premium cars and can now be ordered in entry level Fords. 

Barry Santini
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Klaus Nielsen:

Harman know a thing or two when it comes to milking a brand. Extreme short term profit is the name of this game. They will stick the B&O logo to what ever. Just look to the automotive “products” from Harman B&O that started out in premium cars and can now be ordered in entry level Fords.

It is, IMHO, just this type of thinking (no offense meant) that brought B&O to where it is today.

Thinking of B&O as a luxury or premium brand is not constructive.

It should be Clearly repositioned as destination brand, offering a list of well defined core qualities, available to entree at various price points, including what was known as Play. Trying to keep it segregated through stuffy and inefficient B1 stores was and is a losing proposition.

Life is complicated today. What B&O should never be is complicated. Once that is understood, their focus will naturally shift and again prioritize BeoCare, which always had been one of the brands best core qualities.

Instead of customer support being viewed as an expense, it should be returned to its rightful place as an asset.

B
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The installation in the Ford cars is highly regarded from the reviews I've read. A lot better than the "Sony" labelled audio in my wife's Kuga(Escape) where Sony licence their name to something they just OK from another developer. I hope this genuinely Harman developed B&O remains the way it's done. The blurring of Beoplay into B&O is an issue but a look at how Amazon, Sonos and Google have become brands of audio shows the commoditisation of the market which Bang and Olufsen has to fight. 

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Millemissen
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Slightly off-topic - what’s wrong with a Ford?

MM

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Millemissen
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9 LEE:

 Do you even care enough to post?!

Lee

I do - but I’ve misplaced my crystal ball.....so don’t know what to write.

I prefer waiting to see what happens instead of speculating.

But it is fun to read (some of) these posts 🧐

MM

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Simonbeo
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Millemissen:

Slightly off-topic - what’s wrong with a Ford?

MM

Nothing wrong with a Ford. Just not perceived as "premium" as the cheating brands from Germany. Obviously lacking in the snob appeal that some feel necessary for B&O to be associated with. Instead B&O give an image boost to Ford. The questionable thing is that the original links such as Audi were with B&O but Ford is linked with Beoplay. Or was..

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Millemissen
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I am rather sure that those, who choose a B&O/BeoPlay audiosystem for their Ford will see it as ‘premium’ compared to the standart audiosystem of a Ford.

MM

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mawheele
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9 LEE:

So... with the share price crashing, very few new products (waves of new colours, yes..) and an apparent exit from previously held markets such as Aus/NZ and USA, all combined with a general dissatisfaction of customer service - and the shift from the 'plastic' Play products becoming 'main brand' Bang & Olufsen branded items, where do you see things going from here?

More store closures?  The brand sliding even further into becoming just another 'Beats' with a few flagship products to add a bit of Kudos (if anyone even notices, because there aren't any stores to see them in anyway..) - or do you think B&O has hit the bottom and is now ready to bounce back up?

Financially, B&O have been selling off assets and (to the layman) have been doing this just to keep on trading. Then, the Play products have given them the margin they need.. at the expense of the good name. 

Review sites are littered with '1 Star' bad experiences, we have a negative tone on BeoWorld, and the brand seems to have become totally irrelevant to anyone under 30.  Is this the "burning of the fields" allowing B&O to start from a clean slate, or has the brand name been damaged beyond repair?

Some people on here may think B&O has never been in a stronger position. The brand is bigger than it ever has been, and the products are vastly superior to anything ever made before - and the company is ready to conquer the world from the strongest possible platform.  

If you do think the above, then I'm happy for you.  For all the other people - what do you see for B&O in 2019?  Do you even care enough to post?!

Lee

Reading this, the executive team should all arrive at the office tomorrow and jump out of the highest window.  I'm not sure I agree with it either. For example it misses the share buyback which is normally a sign of confidence and revenues will be flat with last year. Not exactly a disaster. Compare this with Sonos who reported revenues down 7% from a year ago.

Tue's original strategy for Play and Premium still looks good. Look at B&W by comparison.  The car speaker strategy has been successful from a brand execution perspective with Play being in mainstream vehicles and Premium where you'd expect - I'm just not sure the royalties have been anywhere near sufficient.

The Speaker business has executed flawlessly and their multi-room platform is clearly one of the best after Sonos. Its just a pity they've been slow into the TV sound bar space. The Eclipse is a good all-round product, reliable, up-to-date and delivers without most of the software issues of the past. 

If there were any signs of concern, it's the primary focus on channels and distribution. I'm not convinced the management team understands what is good or bad about its channel, and IMOP some elements of the bad bit has survived - and is seen as part of the good - whilst the owner/operator single stores that had management who really cared were unable to survive through B&O created issues, not their own.  From my own experience, the larger store owning groups are what give B&O a bad name and the smaller owners continue to deliver what gives B&O a differentiated experience. The groups deliver a "whatever" experience, are killing the 'pre-owned' market that allows B&O customer to repeat buy and create huge purchase dissatisfaction. They remind me of what it's like to buy a Jaguar car - all smiley face sales reps fresh from a product training course on commission - and have no real passion or ownership for the brand.

The other big area lacking clarity is where the R&D is going? Focusing exclusively on a sound only business is not a good idea and I hope that's not the case. The ability to differentiate and drive margin will only get squeezed -  it's not a growth segment as proven by Sonos.

Meanwhile, those shooting holes in the Play business should take a closer look at Bose's financial performance, then judge. Tue Mantoni got it spot on.

Let's hope that whilst the current management try to drive distribution efficiencies they understand a key component of the brands loyalty and success - the store franchise owner / operator. Run some satisfaction surveys of customers from the larger store groups and then judge. You'll be shocked.

 

 

9 LEE
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9 LEE replied on Tue, Jan 1 2019 6:20 PM

mawheele:
Reading this, the executive team should all arrive at the office tomorrow and jump out of the highest window.  I'm not sure I agree with it either.

Excellent, and Thank You!  I was hoping to have a counter-opinion (or many more) with some valid comments to back them up, and this is a well balanced one.

MM : When you say "what's wrong with Ford?" I agree. Thee's nothing wrong with Ford as a car, or a company. However, are Ford a 'Premium Brand'? When you align Ford with Bang & Olufsen, who wins here?  Does a Ford look better for having B&O in it, or do B&O look better as a brand for being in a Ford?  No need to answer that question by the way.

Back to mawheele's post :

Sonos : Market penetration can hit 'peak', where so many people have the product they don't need to renew it. You then reply on 'new entrants' to the brand - and these decrease as market share increases. We're also in a slow-down, where most manufacturers are on a slide.

B&O Speakers. Yes, they're great. Now convince the 'audiophiles' that B&O speakers are worth the respect they deserve. The man with the 'street cred' for this is Geoff Martin. 

Distribution : B1 has backfired. The absolute snobbery in a time of a financial boom has blown up in their faces. Multibrand is the way forward, with B&O being the 'Halo' product in a multibrand store once more. B&O seem to be pushing against this. Why. I have no idea. If your products are better than the competitions - put them next to the competitions. D'uhh....

Brand loyalty?  You missed a whole generation or two. Hit the reset button and start again, starting now.

Lee

 

 

Steve at Sounds Heavenly
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Hi Lee,

I think 2019 will be an interesting year for B&O - the technology market as a whole is struggling and they are quite a small player in the global electronics ecosystem.  However...... several people have already mentioned Geoff Martin's input to the company and I think that they have possibly spotted 50% of the reason why B&O are likely to bounce back and succeed.

The other 50%?  Alongside Geoff as an employee member of B&O's board of directors is Brian Bjorn Hansen, another long term B&O technical expert who, along with Geoff, knows the products, markets and technologies inside out. Geeked

Of course, they are just two out of thousands of other "good guys" at B&O, although they are possibly the two people with the best chance to influence the company's future direction.

My personal view is that while Geoff and Brian are on the B&O board, the company has every chance of a healthy future.

As we are in the Christmas movie season, I would suggest that following B&O's financial performance is like taking a plane ride with Indiana Jones - going down to one engine and running low on fuel is par for the course, however they always seem to come through unscathed somehow...... Big Smile

I possibly have more of a vested interest in this issue than many Beoworlders, as my business has rather a symbiotic relationship with B&O, supplying their stores and customers with cables.  However, I am still confident enough of B&O's abilities to confidently invest in supporting their products going forwards.

Wishing Beoworlders (and all at B&O) a very Happy New Year! DrinksBeer

Kind regards, Steve.

Steve.

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Sounds Heavenly are proud to sponsor BeoWorld!

OldJack
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OldJack replied on Tue, Jan 1 2019 9:30 PM

9 LEE:

mawheele:
Reading this, the executive team should all arrive at the office tomorrow and jump out of the highest window.  I'm not sure I agree with it either.

Brand loyalty?  You missed a whole generation or two. Hit the reset button and start again, starting now.

Lee

Before they jump out of the windows,give them strong advice: Not to use umbrellas as parachutes.

We need some of them to bring back B&O to glory days...

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9 LEE
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9 LEE replied on Tue, Jan 1 2019 10:10 PM

OldJack:

We need some of them to bring back B&O to glory days...

We do indeed - so lets discuss how we all think this can happen?  That was the reason for my initial post.  Throw a negative out, and hopefully get a positive back.

How can B&O get the glory days back. Where are they now, and how can they go forwards?

We all love B&O, that's why we're here. Let's have some positives?

CB
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CB replied on Tue, Jan 1 2019 11:18 PM
9 LEE:
“Is Geoff Martin still on board?”

I've always maintained he should be the CEO.

Who’s going to replace him as Tonmeister then?

No that easy to do both jobs...
jk1002
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jk1002 replied on Wed, Jan 2 2019 12:39 AM

To me, their brand should work. Leica can sell 7000$ cameras, Rimowa 1800$ Suitcases can't see why people would not pay 10K for a TV or speaker as well.

I don't mind the rebadging. I still watch happily on my BV8, I do not need best picture quality. Their "You watch the TV for hours then you turn it on" slogan nailed it Create beautiful objects just like expensive furniture.

For Audio, what they did with the Essence and the Airplay and Spotify integration was genius. Not too complicated, functions added value and made sense and seem supportable.

This may not work in US  but other countries should be. 

For the Beoplay, I do not see anything wrong with that. Keeps the brand relevant.

Barry Santini
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Ok.

First, lose the euro-centric, class-defining mentality about the product and its distribution.

Second, and fer ***’s sake, make the product instructions fathomable to the average lay person.

Third, remember what made you great and rediscover it.

Forth, remember the (recent) product and financial mistakes made, and do NOT repeat them.

Fifth, fire anybody who doesn’t agree with the first 4 statements.

Six, understood that your help desk is not really a reality lab for product development.

And finally Seven, put Geoff in charge of EVERYTHING.

B
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I think that 2019 will be interesting. I personally believe they are at rock bottom however will bounce back.

If we look at the Annual Report 17/18 their aim this year is to Become The Most Desired Auduo Brand In The World.

Their strategy is all about brand and brand positioning.

The strategy is to move from the product luxury quadrant to the luxury lifestyle market. I thought that market was dead 🤔

Their intention is to place the customer experience at the centre of technology. And ensuring meticulous attention to detail. Not sure how that’s going ? I like how they don’t say to put the customer at the centre of everything they do. They say ... of technology. Weird.

The responses to the software updates by the team on here for the eclipse have been working hard and living toward this. On Instagram I posted the hash tag #reimagineb&o cos I think that’s what the established in that company need to do.

We are (beoworlders) are creative curators but they haven’t even tapped into that yet.

They posted that Elle Deco awards. It seems these are the awards they want to win.

The higher end products such as eclipse , bl50 and shape are “staged products used in stationary settings”. They want to create innovative and progressive products that set new industry standards and to expand collaborations eg HP, Hartman, saint laurent,

So I think these predictions from themselves will see the brand positioned more than the products.

DMacri
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DMacri replied on Wed, Jan 2 2019 2:49 AM
I predict B&O will continue to court CEO level salaries for their new product customer base. Unfortunately, these customers expect the products they buy at those price points to work flawlessly, look and operate at the premium levels they paid. Since B&O have tried to reduce costs by making products at lower total manufacturing costs but kept the prices at an order of magnitude of their competitors, and allowed the quality to slip, they have damaged their reputation, and have likely lost this very limited customer base.

It could take years for them to correct this mistake. I hope they can survive until they get this worked out.Sad

IMO they should make products that are targeted at a larger customer base a level or two below the C level salaries of today, and work hard to ensure acceptable quality levels. Then it would make sense to actually advertise their products to attract a wider audience - those that can afford the products now and allow others to save up for these as aspirational products.

Dom

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Puncher replied on Wed, Jan 2 2019 10:28 AM

DMacri:
I predict B&O will continue to court CEO level salaries for their new product customer base. Unfortunately, these customers expect the products they buy at those price points to work flawlessly, look and operate at the premium levels they paid. Since B&O have tried to reduce costs by making products at lower total manufacturing costs but kept the prices at an order of magnitude of their competitors, and allowed the quality to slip, they have damaged their reputation, and have likely lost this very limited customer base.

 

It could take years for them to correct this mistake. I hope they can survive until they get this worked out.Sad

 

IMO they should make products that are targeted at a larger customer base a level or two below the C level salaries of today, and work hard to ensure acceptable quality levels. Then it would make sense to actually advertise their products to attract a wider audience - those that can afford the products now and allow others to save up for these as aspirational products.

 

 

………..as it used to be! So, what went wrong last time that lead them to here?

Ban boring signatures!

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moxxey replied on Wed, Jan 2 2019 11:05 AM

jk1002:

To me, their brand should work. Leica can sell 7000$ cameras, Rimowa 1800$ Suitcases can't see why people would not pay 10K for a TV or speaker as well.

True. But isn't there a hugely different business model between Rimowa and Leica versus B&O?

Firstly, there are very few Leica and Rimowa stores and the stores that do exist (in major cities) are more 'concept' stores (like the concept store B&O has opened in NYC recently). So you walk into a Leica store not always to buy a Leica, but just to admire, find info, get your camera serviced and so on.

Secondly, Leica and Rimowa both have fantastic retail support. B&O does not. B&O relies on their flagging B1 stores and their own website and few people go to either of these locations. However, you see top camera websites and retailers promoting Leica products and you'll see travel companies promoting Rimowa and retailers pushing their suitcases.

Instead, B&O did something rather daft and launch BeoPlay and only allow retailers to stock these and tried to separate the brand from mainstream B&O.

I agree there should be a wider market for B&O products. But they should stop relying on their old model of distributing and promoting their products, however much this hurts their existing dealer network.

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Sandyb replied on Wed, Jan 2 2019 2:26 PM
But Leica has survived because of they retain a heritage feel, and their current products are still excellent. All of this can be had for high but not silly prices.

Pros and prosumers consider their products.

B&O prices just appear silly to too many now, especially as their designs aren't quite as distinctive as they once were.

The reviewers get excited by mainstream TV'S getting better and cheaper, so they'll ignore B&O offerings at 8-10k. So it's no surprise that all they talk about are Play products, where the price increments are more modest.

Anyway, B&O have always been niche - their issue is whether they can at a minimum hold on to their core customers. Far from clear right now. Systems fading into the background etc makes life tough for a brand known for its design flair.

Without more compelling products, distribution matters up to a point but isn't the primary issue to me.
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Have premium TVs really got any cheaper? Still seems to me to be a price-point market with £1299, £1599, £1999, £2499 ad £3500+. Obviously at the top-end you now get an 8K product, but decent/current LG's in the 55, 65 are still at the higher price points. Yes, you can get a C7 55 for £1299, but as you'd expect, that is last years product they are trying to off-load. Its still fair to say that when you add a premium/current OLED and matching soundbar you are still looking at something costing £3k+ that looks like crap. And BTW, they'll have zero value the moment they're taken out of the box. Then add the Logitech remote....

BTW - The Eclipse received some pretty good reviews across media despite the price.

 

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Puncher replied on Wed, Jan 2 2019 4:04 PM

mawheele:

Have premium TVs really got any cheaper? Still seems to me to be a price-point market with £1299, £1599, £1999, £2499 ad £3500+. Obviously at the top-end you now get an 8K product, but decent/current LG's in the 55, 65 are still at the higher price points. Yes, you can get a C7 55 for £1299, but as you'd expect, that is last years product they are trying to off-load. Its still fair to say that when you add a premium/current OLED and matching soundbar you are still looking at something costing £3k+ that looks like crap. And BTW, they'll have zero value the moment they're taken out of the box. Then add the Logitech remote....

BTW - The Eclipse received some pretty good reviews across media despite the price.

 

IMO there is nothing coming after the Eclipse (already 2 yrs old - a good TV with probably the best sound out of the box) and so we need to get our heads around the 3K "crap" solution pretty quickly as the newer panels are moving on with additional features and picture improvements - are you really going to shell out £10K for a 2yr old TV? If B&O miss the boat with their soundbar/centre solution then once previous customers are forced to move away to something else they are unlikely to come back.

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mawheele
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Puncher:
The point people keep missing is that there is nothing coming after the Eclipse

Where are you getting this intelligence from? I would test your sources. I don't know anything, but it would be weird for a company to walk away from 26% of its revenues, just a few months after its told its shareholders that the LG relationship has been a key element of its recent success and that revenue in the TV business is growing off the back of great Eclipse sales. In fact, I'd almost goes as far as to say they'd be sending out a misleading narrative to holders of B&O shares if they were to exit.

The C8 panel offers little advantages, so B&O are giving that refresh cycle a miss as it doesn't warrant the integration costs.  Understandable. Plus with HDMI 2.1 having just been ratified in November, they are better jumping on the Model Year 20 options and refreshing at that point when there is sufficient new capabilities and differentiated functions like 8k and Dynamic HDR.

BTW the C7 panel had general availability from the 3rd July 2017 and first availability of the Eclipse was September 2017. In B&O terms, the paint is still wet Smile

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mawheele:

Puncher:
The point people keep missing is that there is nothing coming after the Eclipse

Where are you getting this intelligence from? I would test your sources. I don't know anything, but it would be weird for a company to walk away from 26% of its revenues, just a few months after its told its shareholders that the LG relationship has been a key element of its recent success and that revenue in the TV business is growing off the back of great Eclipse sales. In fact, I'd almost goes as far as to say they'd be sending out a misleading narrative to holders of B&O shares if they were to exit.

The C8 panel offers little advantages, so B&O are giving that refresh cycle a miss as it doesn't warrant the integration costs.  Understandable. Plus with HDMI 2.1 having just been ratified in November, they are better jumping on the Model Year 20 options and refreshing at that point when there is sufficient new capabilities and differentiated functions like 8k and Dynamic HDR.

BTW the C7 panel had general availability from the 3rd July 2017 and first availability of the Eclipse was September 2017. In B&O terms, the paint is still wet Smile

I agree on these points, and saying that the Eclipse is 2 year old, is very exaggerated.

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Puncher replied on Wed, Jan 2 2019 7:56 PM

Emil Jensen:
I agree on these points, and saying that the Eclipse is 2 year old, is very exaggerated.

Fair enough  - we'll call the panel 17 months old instead of 24 if it makes you feel better.

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Sandyb replied on Wed, Jan 2 2019 8:33 PM

So this years LG B8 55 inch is now around 1200 GBP - thats this years model.

Yes there are higher priced models, but hand on heart most here wouldn't be able to tell the difference. There are a few more calibration options, but unless you are getting a professional to do it, those extra options are irrelevant. So the Alpha 9 vs 7 is marginally more snappy, but web OS on the Alpha 7 is plenty quick enough.

Anyway, given the mixed reception many here gave the Eclipse (felt too much like an LG etc etc), do people even want another BV ?

Or would the more popular choice be the equivalent of a Sound Centre / hub, able to integrate a wide range of 3rd party screens?

(not every screen will integrate easily though - what to do with the current Wallpaper TV speaker, i.e. messy)

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Sandyb replied on Wed, Jan 2 2019 8:40 PM

re Sonos, look at their repeat business / returning customer stats....they're amazing.

From the Verge - 38% of Sonos first time buyers have follow on additional speaker purchases.

That's not to be sniffed at.

 

 

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Sandyb replied on Wed, Jan 2 2019 8:43 PM

Walking away from 26% of revenues?

But the profit contribution is surely much much lower, so far easier to walk away from.

 

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What does this recent ad tell us about the direction of travel?

“THE OPPORTUNITY

Do you have 3+ years of experience working with color, materials and finish, and would you like to use this experience in the design of Bang & Olufsen’s luxury lifestyle audio products? And are you looking for an opportunity to:
– Improve your CMF design skills and apply them to Bang & Olufsen products?
– Join one of the best-known luxury brands in the world?
– Gain an international network of competent and collaborative colleagues?

Join the Design team 
As our new CMF designer, you will join the Design team in Lyngby, Denmark, consisting of 6 design managers with different competencies. Together with colleagues based in Lyngby, Struer and Singapore, we participate in cross-functional projects, contributing with our product design expertise. Doing so, we work as one team to share knowledge, run design reviews and provide feedback on a weekly basis. And now, we are looking to expand our CMF team with a designer.

Implement world-class CMF across Bang & Olufsen’s luxury products
As our new CMF designer, you will work closely with our CMF manager to implement colour, materials and textures across speakers, headphones and earphones. Working with inline products, special editions as well as fashion and interior collections, you will ensure that our products live up to our CMF strategy.”

There's more... including 20 days travel to review colour samples in China......

https://www.yankodesign.com/2018/12/24/yd-job-alert-bang-olufsen-is-looking-for-a-cmf-designer/

Jackplug
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Hi Lee, I care :-)

My first time back on here in maybe 5+ years. I was here on Beoworld in the beginning.... (2003?)  I saw this latest question about predictions for 2019....  was relieved but upset to read that all my fears are actually shared among other life long fans.... I thought I was just getting old and grumpy.  I've been turned off B&O for some time... even though my house is full of it, from the 70s +  All the modern stuff... I say all, there's not that much is there....   is just same old thing re jigged.  I mean, come on, just what is the 'Edge' all about !!!  At least the A9 had some style to it.   And the M5 biscuit tin...  not even going to bother mention anything else EXCEPT!!!  I do love a pair of S3s in stereo, now that is pretty special for the size, and my A1 which I love and take away on holiday all the time.  So it's not all bad... :-) 

Regards

Jack

ebay (beo-store-uk)

 

mawheele
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Sandyb:

Walking away from 26% of revenues?

But the profit contribution is surely much much lower, so far easier to walk away from.

 

Folks - before we make comments like the above, please check your facts. Stuff like this on boards can impact perfectly good businesses actually doing well - like saying product categories are EOL or immaterial to their profitability.  Here is what we actually know "The gross margin for the Bang & Olufsen business unit was 45.2 per cent against 42.4 per cent in the previous financial year. The significant improvement in gross margin was driven by an overall improvement in product profitability, especially on TVs, increased income from brand partnering, and a change in product mix."

Taken from the B&O's report and account for the last financial year.

Its not all doom and gloom - in fact, there are many rays of light.

 

PaulGiles
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Evening all, first time post on here but have been avidly following the forum.

We are a Fire & Security company but have also been awarded B&O CI status.

We are also SONOS approved.

We do very little AV work but thoroughly enjoy the small works that we do get.

B&O has always been an interest for me ever since I saw the stunning BS9000 and a friends green TV with a slot for a video tape that moved on its stand!

Plans for 2019? Well, from my experience with both SONOS and B&O the customer loves the sound and look of B&O but cannot justify the price gap.

One major selling point for B&O over the rest is the fact they also do TV but now this is no longer?

Another issue is reliability, for the money the kit should be flawless, it is not.... BS2 doing the double network beep every hour or so anyone??

Multiroom from SONOS has the odd issue but support has been fantastic and the APP is extremely easy to use, the same cannot be said about B&O. I know a SW update is on its way to rectify this but it should be sorted much quicker than it has.

Respect has to be given to the brand and the dealerships as it is a small company in comparison to others yet produces products like no other.

Brand awareness however is very poor. 100% of clients are aware of or have had Bose and SONOS yet no one has heard of Beoplay. Some know of B&O of years ago and are always amazed when I tell the you can get a BT speaker for under £200.
mawheele
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PaulGiles:
One major selling point for B&O over the rest is the fact they also do TV but now this is no longer?

See what I mean!!!!

B&O are still in the TV business!!! The Eclipse is one of their best products ever!!!! 

Sandyb
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Sandyb replied on Wed, Jan 2 2019 9:45 PM

Hang on - that says nothing about the actual contribution that TV's make to the top level gross margin, nor the actual margin on their BV's.

Mass scale TV manufacturers make margins in the region of 10-14%, and they have the benefits of scale. LG recently reported a record margin on TV's of 14%, and Sony's equivalent is between 10-11%.

My dealer has continually told me that from what he learns from B&O, the company makes a pretty slim margin on their BV's. Whether that has improved a bit is unlikely to change this picture materially. He has a long relationship with the company.

So I stick to the original point - share of sales and of profit are likely very different.

Reading through the 2015 annual report, I'm struck by a note they make - overall margin was adversely impacted by a higher share of TV sales in the mix.

If that doesn't suggest that their TV's are not what drives their margin, well I don't quite know what other indication one would need.

Anyway, despite all of this, and despite all the mood music, they make in the end make more BV's if they decide they are necessary - though the direction of travel suggests its real risk they move away.

 

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