Macpac Xmas Sale, I'm in 2 minds

[JohnM]

Most of you probably got the Macpac Xmas sale email yesterday. There's some very heavy reductions: for example

Olympus down from 900 to 500, Minaret down from 750 to 400, Microlight down from 500 to 250.

Personally I'm very much over the retail roller-coaster of full price/massive reductions/full price. I just want to know that I'm buying something of quality, sold at a fair price all year round.

This is the philosophy behind the 'big box' retailers 'everyday low prices' and the complete opposite of the boom/bust cycle of old style retailing.

I guess if you've had your eye on something from Macpac, this is good news. But I wonder why a company thinks it's ok to charge you 900 bucks one day, and 500 bucks the next, for the exact same thing? Obviously the 'sustainable' price is somewhere in the middle.

I actually have a lot of respect for manufacturers like WM and Hilleberg. The price they charge is pretty much the price they charge, and it hardly ever varies. At least then I know what they think their gear is truly worth.

Today, I'm not sure if a Macpac Olympus is actually worth 900 or 500? What's the true value? If I had to make a judgement, I'd say that Macpac thinks the Olympus is probably worth 750, but because they ride the retail roller-coaster, sometimes they overvalue it and sometimes they undervalue it.

Didn't mean to pick on Macpac. They're not setting the rules here, just following market conditions really. But personally I'm finding myself shying away from brands and stores that do this kind of thing.

[PeterJ]

I would be extremely surprised if anything sold at sales (at any retailer not just Macpac) was not making a pretty good profit.

[Maelgwn]

Hi John

Go and talk to an independent gear shop about this, they will fill you in on it all!

"True value" would be pretty hard to define.

My approximate understanding is that as Macpac (and others) have control of every step of the product (design - manufacturing - distribution - sales) and are a big company (hence big production runs, which also save money) they can easily make a profit even when on sale because there are less companies/steps to take a little bit out of the pie along the way.

Macpac can have very high prices in the Australian market because that is what the competitors (e.g. Black Diamond, Petzl, Western Mountaineering) have to charge to pay the overseas design/manufacturing, importing, distribution, sales costs (which might all be different companies needed to make a profit). Or the competitors have Australian made products where wages are high (e.g. One Planet and Mont).

[blacksheep]

Funny to call us a big company Never saw us that way, just a good company.

The retail prices of Macpac items have stayed the same or gone down in the last 10 years, this in a time of riding costs. The materials,factories, specs have not changed. We need to compete for market share against big public companies in the outdoor market, and for spend elsewhere (ie: holidays, bikes etc). So we give up margin for market share at the times of the years others do- look around retail landscape in Australia and New Zealand.
We try to keep the staffing levels and service high year round, and the product quality is foremost. That is our point of difference.

[JohnM]

Fair enough campbell,

but the retail landscape is now made up of several different methodologies: the full price/big sale model, and the 'everyday low prices' model where they NEVER have sales (Bunnings, Kmart, Officeworks, etc). There's a third model for specialist manufacturers/retailers, which is 'this is our price, like it or lump it' (think Apple, Hilleberg, etc).

This third model works if your product has a genuine point of difference over others, and isn't just another commodity. And the consistent pricing becomes part of the brand promise (we believe in our products, we price them fairly, and we don't play games).

I understand sales on impulse purchases at certain times of the year. What I don't understand is how a tent that's a big ticket item, a very considered purchase, that's meant to last you a decade, can be $900 one day and $500 the next.

Assuming you're still making some kind of profit at $500, it doesn't say a whole lot of good things about your regard for the customer who bought it last week at $900.

Personally I think if you're operating at the quality end of the spectrum, selling gear that has a good reputation, and 'quality first' is your point of difference, then as a BRAND (maybe not as a business, at least in the short term) you're crazy to be doing Kathmandu-style discounting of top-end gear.

I now look at the Olympus and, to me, it's a $500 tent. Because you're happy to sell it for that. So next month I see it back at $900 and think, WT *$&#? what a rip-off. I'll wait till it's back to its 'proper' price again.

Playing retail games erodes the trust I assume a quality brand like Macpac wants me to have in them. That sort of behaviour belongs at Kathmandu, who make gear I wouldn't rely on in a fit.

I write this knowing full well how difficult the retail sector is now. But I also know that Macpac's future prosperity relies in it being known for quality gear with a point of difference, not in selling price-sensitive commodities. Unless you want to be the new Kathmandu, which is obviously a nice way to make a buck. But it's a radical departure from what Macpac stands for.

It feels like at the moment, the Macpac business is trying to play both sides of the fence. I personally don't think you can maintain a reputation for utmost quality, while halving the prices of your gear to generate sales. In the longer term, they're mutually exclusive concepts.

edit to add:
Most companies, I wouldn't waste this kind of criticism on. But I hold Macpac in high regard, and as I've mentioned before, I've got Macpac gear that's served me amazingly well for many years, so there's a a lot of goodwill there, hence the rant

[etrangere]

I've posted a fair bit about the Crapmandu sales cycle style of retailing. My only hope is that MacPac maintains its high quaility, as I have no control over that. If they want to play the over inflated RRP/ sales cycle game at least I have control over when I choose to buy any of their products. In saying that they probably get less of my money on the whole as I refuse to buy anything now unless its on sale, and not everything i want is on sale.

[South_Aussie_Hiker]

I've posted a fair bit about the Crapmandu sales cycle style of retailing. My only hope is that MacPac maintains its high quaility, as I have no control over that. If they want to play the over inflated RRP/ sales cycle game at least I have control over when I choose to buy any of their products. In saying that they probably get less of my money on the whole as I refuse to buy anything now unless its on sale, and not everything i want is on sale.

Unfortunately, this is the problem which Macpac face. When companies like Krapmandu keep doing these ridiculous sales, buyers expect it from other retailers - and it gets buyers in the mind-set of not buying anything unless it's massively "slashed" prices. What this means for Macpac, is that in the short term more volume of sale goes to Krapmandu and they miss out.

While gear purists (like most on this forum) prefer quality over price, the fact remains that people like us who place quality well over price form the minority of shoppers. If Macpac focus only on top quality gear for the purists, their market share will be so low that they become unviable. Krapmandu have decided on a marketing ploy which essentially straddles the fence. The standard prices are very high (to give the illusion of best quality) but the frequent, hugely discounted sales gets the majority of the population through the door. As tragic as it is to watch, I don't feel that Macpac has any alternative but to follow.

If they retain extremely high quality gear at very high prices, they won't survive because of lack of market share.

They may have done before online shopping became easy/cheap/convenient, but not now.

It's a terrible shame, but that's business

This third model works if your product has a genuine point of difference over others

This only works if, as you say, there is a genuine point of difference - but also a high volume required. Info tech is perfect for this, because changes in products happen so quickly and everyone has to have the newest, latest and greatest gear. It doesn't really apply for outdoor gear, because the latest and greatest tent doesn't become obsolete in <12 months time.

[wayno]

how much are the sales to do with companies like kathmandu's getting massive shipments in to coincide with their sales. shift massive volumes for turnover. cheaper to only import their merchandise in occasional big hits. lowering overheads. its as much of a signal to people buy now, and don't buy in between the sales because theres little or no stock coming in then, everyone knows we will have another sale eventually so wait till they happen again when all the stock is in.
i've heard the factories that make their products overseas can do a production run for macpac in a day and kathmandu in a few days or weeks, so they book the factories to do their production runs ship it, have a sale. then start the whole cycle over again..... scale of economy in massive bursts.

[wayno]

Macpac can have very high prices in the Australian market because that is what the competitors (e.g. Black Diamond, Petzl, Western Mountaineering) have to charge to pay the overseas design/manufacturing, importing, distribution, sales costs (which might all be different companies needed to make a profit). Or the competitors have Australian made products where wages are high (e.g. One Planet and Mont).

i beg to differ about the justification of high prices of the brands mentioned, theres a hell of a big difference in the price in countries like the states compared to down under even taking shipping costs and taxes into account . and given a lot of brands will block overseas sales to individuals theres something else going on, but that has already been discussed ad elaborated on in other posts by numerous people on this forum

[hikingoz]

I look at outdoor gear all the time and see rrp at $XXXX and say "It's not really worth that much." I agree with the observation that the price fluctuation seems rediculous. I too find the ups and downs annoying. I rarely buy at the rrp.

Massive price fluctuations put consumers at the mercy of the vendor. I don't need gear only once or twice a year. I shouldn't have to buy it that way.

[gayet]

...... I don't need gear only once or twice a year. I shouldn't have to buy it that way.

No one is forcing you to buy only once or twice a year. You have the convenience of buying as and when you want. If a retailer chooses to offer goods at different prices at different times of the year, that is the retailers choice, as it is yours to only buy at the time when prices are lowest.

[wayno]

i read somewhree in the news some time ago about jan cameron buying a share of macpac and a stated aim of them having year round lower prices... it didnt say when that was likely to happen

[Dale]

I don't need gear only once or twice a year.

Oh if only I could limit my gear spending to once or twice a year !

Last edited by Dale on Fri 25 Nov, 2011 7:32 pm, edited 1 time in total.

[hikingoz]

No one is forcing you to buy only once or twice a year. You have the convenience of buying as and when you want. If a retailer chooses to offer goods at different prices at different times of the year, that is the retailers choice, as it is yours to only buy at the time when prices are lowest.

My point was a bit more subtle then that. Of course I can spend my money whenever I want. But obviously I can also only afford things at what I consider to be reasonable prices. I am a regular customer of the outdoor stores in my area and find the pricing structure quite frustrating. I think it is a valid point to make.

Not singling out any retailer in particular. In ACT most of the stores are on the same street. I generally zigzag from one to the other.

I also agree that Macpac's point of dif. is quality (from my experience), which is definately a good reason for higher rrp over some other brands.

[Mountain Rocket]

In ACT most of the stores are on the same street. I generally zigzag from one to the other.

It is the same for (at least) Melbourne and Hobart and I think you make a fundamental point - zigzagging! I am sure most of the people in this discussion (and generally members of this site and possibly the market as a whole) shop around. These days there is very rarely a "one stop shop" for any of your purchases.

Has anyone had a look out their local outdoor retailer strip recently? At least here in Hobart, all of them are having sales. Sure people might regard Macpac as a higher quality store, blah blah, but think about how they would look as the single retailer refusing to offer sales at this time? I certainly would not think of it as a good thing. Each to their own and all, but that is my take on it.

[wayno]

rrp, recommended rip off price? when you look at what the gear you're buying is made of and what the labour cost of making it is, why is it that expensive,
if you have certain technologies in your gear it seems to attract a premium but why does something like gore tex cost so much more than a lot of other similar products?
doesnt matter what type of product you're buying, it's a fashion industry, it it's considered desireable then a premium can be charged.... if you market yourself extensively as if you are superior to the competition you can sell massive amounts of your products no matter how much it's just the same as the opposition.
problem is people keep patronising the companies that do all this as long as that happens the companies will keep behaving in similar ways.
i've been sicked in by brands in hte past, bought expensive boots made of cheap synthetic material that quickly fell to pieces, the makers would have been laughing all the way to the bank, although not all their models were like that but you'd really pay for the ones made of better material.
the whole outdoors market has changed greatly, once apon a time foam sleeping pads were free industrial waste until someone decided to market them tweak them and charge even more for them... outdoors shops arent selling the cheapest available gear, often the opposite, how many plastic sheet coats have you seen being sold in outdoors shops? you'd barely know items like poncho's exist looking at a lot of outdoor retailers go to an industrial clothing or agricultural supplier and you can get outdoor gear for a great deal cheaper. and often it's more robust,

[maxwellbest]

Checked out the sale instore this morning. Shame I have most of what I require. Some great deals, and I mean great deals going. Though I do take some of the points raised in this thread. One does wonder what sort of mark up is on this gear. Workers in Vietnam and China wouldnt be seeing too much of it. But thats another story....