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2. Opportunity for Profit
Buying earbuds are not like buying laptops. Laptops are easily comparable with transparent specs. (ie. higher RAM = higher $$ etc.) For earbuds, the average consumer wouldn’t know what metrics to look for (sensitivity? range?). As long as it sounds decent and performs well. Plus, you can’t try them on to know how well it fits (for hygiene reasons), unlike demo laptops at the store. Instead, earbuds rely heavily on marketing like distinctive designs, celebrity endorsements and sponsorships (ie. Beats then & Raycon now). Hence, an ‘okay’ pair of earbuds would have a much higher price tag because of branding. Branding and design are “intangibles” that add value without adding to component costs.
The huge untapped market of consumers being okay with just decent earbuds becomes a low barrier of entry for any competent manufacturer hoping to make a quick buck off the high profit margins. See what I meant by Gold Rush? However, it’s only a matter of time until bigger smartphone companies (ie. Apple, Xiaomi, Samsung) leverage their ecosystem aspect and squeeze out the smaller earbud brands. Maybe by then another gadget gold rush will emerge. 🤷🏻♂️
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