In these difficult times I think we are all entitled to the occasional gentle let off rant so here is one from me.
Why are the UK prices so high compared to US?
I have been trying to justify to myself buying a couple of additional speakers before my system goes into Legacy Mode. Saw the Sonos Sale on the US site and thought - you know that is probably good enough reason.
In the US a Sonos One is normally USD199 down to USD 149 and a SL USD 179 down to USD 129. Now it is bad enough that normally Sonos UK prices are a direct translation from USD to GBP so rather than a SL coming in at around GBP 145 it is GBP 179 (based on current exchange rate).
In the Sale rather than a SL being reduced to GBP 129 it is only reduced to GBP 139. So the UK pays more the product normally and in the Sale we do not get as big a discount as our American cousins – double whammy!!!
Best answer by John B
I have no idea whether or not this represents a fair pricing strategy - or even what ‘fair’ means here, but here are a few thoughts as to why, on a straight currency conversion, prices in the UK might be higher, but scope for discounts lower:
- Exchange rates. In the last week or so, the GB Pound hit a 35-year low against the US $.
- Sales taxes may be higher in the UK (VAT and import duties, for example)
- Retail margins may be higher in the UK (and even for direct sales, Sonos cannot undercut its retail partners)
- Transport / delivery costs may differ
But in any case, what I would expect any company operating in several distinct markets to do is to price to maximise profits in each of those markets - the price at which marginal revenue = marginal price. It is more complex than that, of course - sales like this may be about securing market share or getting immediate cash flow. But basically, if $129 is the price that maximises profit in the US and £139 does that in the UK, that is what a rational company will do,