Audio-Technica Introduces New RRP and Trade Price Structure at PLASA: New List Prices Reflect True Average Selling Price


Leeds 10-04-2007 Audio-Technica introduced its new UK product catalogue at this year’s PLASA exhibition featuring revised recommended retail prices across a number of its MI retail microphone and headphone ranges. The new pricing brings UK RRPs in line with average market pricing across Europe and ends the practice of inflated published RRPs, common throughout the UK MI retail trade. The company’s RRPs now more closely reflect the true average selling price in the UK retail market.

The move, precipitated by the harmonisation of European pricing, is also intended to cease the practice of advertising savings on retail prices that in reality do not exist. With actual ‘street prices’ 30, 40 or even 50 percent below some published RRPs in the microphone market, and effectively no-one selling at RRP, the RRP serves only as an artificially high price point from which to advertise discounts.

Commenting on the move, Senior UK Marketing Manager, Harvey Roberts stated, “The MI industry is one of the only industries which continues this practice of inflating recommended retail prices in order to show high cost savings at the point of purchase. The practice is both counter to consumer interests and only serves to confuse consumers as to the actual retail price of a product. It also contravenes the guidelines on retail pricing as specified in a number of legislation pertaining to price

“Specifically, it is illegal to advertise special prices and imply substantial savings, when in fact goods and services are normally sold at those ‘special prices’. Such claims rely on illusory savings and are therefore deceptive and misleading. The Consumer Protection Act states that retailers should not display a recommended retail price in a price comparison that is ‘significantly higher than the price at which the product is generally sold at the time the comparison is made’. Additionally goods should not be marked ‘down in price’ unless they were previously offered at the higher price for at least 28 days in the previous six months.”

Audio-Technica has also expressed its concern about the damage being done to retailers’ business by inflated RRPs, and the ability to earn sufficient margin on sales, in order to sustain profitable trading. “With the current disparity between manufacturers’ published prices and the actual price for which a microphone is selling in the market,” continues Roberts, “a sales rep can tell his customer he can get anything up to 50 percent off the RRP; in reality however, when a dealer sells it at street price, he may only be making a 10 percent margin. Audio-Technica believes that in this competitive retailing environment, dealers need be far more aware of what margin every product line they stock is making and understand what margin they need to make in order to trade profitably.”

The new catalogue brings Audio-Technica’s UK price structure for its Studio line and other retail microphone ranges in line with that already in place for the new Artist Series. The new RRP structure was initially introduced for the new Artist Series™ when it was launched last year: sales for the new Artist Series are on average 300 percent up on a like for like basis, compared with the previous range, which Audio-Technica believes is a good indication that the market overall would prefer a greater degree of price stability.