Last month ABI Research issued a report saying that Personal Navigation Device (PND) manufacturers seem to be “moving away from mass market consumer goods to becoming low volume, high value.” While I take issue with their analysis showing that “nearly one-third of all products offered on the market are above the US$500 mark,” I do think they are onto something.
The fact is, we’re already seeing this trend. Garmin may be stepping up enforcement of their minimum advertised price (MAP) program — I’m not seeing PNDs discounted very much, especially at the high-end. We’re still seeing the upper-end of the Advanced nuvi series selling at their list price on Amazon, a full six months after these units started shipping. Significant discounts are mostly relegated to prior generation units.
It seems like Garmin has realized that they can’t really expand the PND market, and their goal may now be to extract whatever they can from their existing customer base. Doesn’t exactly leave you with the warm fuzzies, huh?
What do you think? Does my speculation ring true?
About Rich Owings
Last week REI had a 20% off coupon for a single item for members. GPS Units were not valid. I was bummed
Strikes me as plausible. Partly because of that pricing strategy, I dwell in the consumer niche of older generation products. Every 3-4 years I look around to see what I can get for $150, and if so inspired I’ll go for the upgrade. So far I’ve not seen a cutting-edge feature worth $300 to me.
Never really thought about it recently, but you could be right. I bought my Montana 600 on July 12, 2011 for $500 at Amazon. It’s going for $495 at Amazon today.
BTW, are you familiar with the website camelcamelcamel? It allows you to track Amazon prices and will show you a graph of price history – good way to test you theory. 🙂 For the Montana 600, it shows a brief drop to $447 for a couple days, then maybe a month around Christmas where it sold for $460. But those were really the only deals.
OTOH, for the somewhat older Oregon 450 we have seen very steep discounts. I wonder if these will continue? IMO, Garmin would be making a mistake to milk this too much because those sales (such as the annual REI Labor Day sale) have made the Oregon one of the most popular handhelds.
I use the Camel site to track things for my GPS Deals site.
I was thinking more about auto devices in this post, but yes, we’re seeing some of the same strategy with high end handhelds. The one time it all goes out the window is the holiday shopping season, but even then, I mainly see discounts on low-end and older models. Fortunately, they keep releasing new models, so I expect we’ll see better Montana and 62 series discounts before long!
Rich, the theory makes sense on many levels. One of which is the “gotta have the latest and greatest” crowd. I’ve been an early adopter for a while now and with the previous 3 or four generations prices tended to drop dramatically within 6 months to a year after release. So many would simply wait it out. Now, with Garmins holding their initial value longer I’d be more willing to adopt early because holding out would then have little benefit.
You and me both. Guess they got us (ouch!). Makes me very glad that REI offers a 10% dividend for members. They are my go to place for new models.
I’ve noticed this too. Garmin 2595 hasn’t really budged below $250, maybe down to $237.50 at one point as per Nextag but no more. Also noticed the Tomtom Go Live 2535 going up in price. Maybe 3 months ago was $189 @ Amazon and is now $274.
BTW Went to REI the other day thinking 10% dividend on nuvi 2595 @ $250 not so bad…only, bad, not in system, no longer available but had been on clearance for ~$150….Dang,dang,dang.
Wow, that would have been a great deal to get hold of!
Well at least two people seem to have proved this theory wrong in a big way, getting the Montana 600 for only $112 at Amazon today: http://forums.gpsreview.net/viewtopic.php?t=25546
Of course, we will have to wait a few days to see if they really get what they are expecting. 😉
Wow, and I thought I got a good deal getting mine for around $425 soon after they came out.
Well you did get a good deal at $425 Rich. If you check that thread I linked to above you’ll see that the three people who ordered the $112 Montana all received cancellation notices from Amazon today. Guess there really is “no such thing as a free lunch” after all. 🙂