What's a company that has went from low price low quality, to high price high quality

[saluki_fan]

I'm trying to come up with an example to use for my marketing class proposal and I need to come up with a company that has went from from a low price low quality company to a high price high quality company. The only company I can think of that would fit this description would be an older established company like Dillards or Macy's. Am I right, or am I totally off base?

Thanks for help. :)

[Zsofia]

Well, the entire electronics industry of Japan, if you like.

[TheFifthYear]

Sony and Samsung both come immediately to mind.

[dalej42]

How about Banana Republic? In the 80's, they were a carbon copy of Gap. In the early 90's, the brands began to seperate and Old Navy filled the budget line, Gap became the mid-priced line and Banana Republic became the high priced line.

[kunilou]

Target has moved from low-price, low-quality to mid-price, mid-quality.

And not just Japanese electronics, but Japanese cars, as well.

[Shagnasty]

And not just Japanese electronics, but Japanese cars, as well.

That's right. Especially Honda's immersion into the U.S. market from the 1970's until today.

[saluki_fan]

so then what would be some examples of companies that have went from high price and high quality to low price and low quality. What comes to mind here for me would be companies that specialize in clothes. For instance Tommy Hilfiger and Polo clothes. What about computers like Dell?

[scr4]

IBM recently sold off its personal computer division to concentrate on high-end business computers.

[Shagnasty]

so then what would be some examples of companies that have went from high price and high quality to low price and low quality. What comes to mind here for me would be companies that specialize in clothes. For instance Tommy Hilfiger and Polo clothes. What about computers like Dell?

I don't like those examples. Tommy Hilfiger and Polo may be more mainstream brands now but I would hardly call them low quality. Likewise, Dell just produces more computers than others do. They aren't necessarily "bad" and many would consider them quite good.

[Ringo]

Another for the OP would be the automobile business of Hyundai.

[Finagle]

Maybe Black & Decker? Known for producing cheap, somewhat crappy consumer tools. Then they bought DeWalt and now also produce highly regarded contractor tools as well.

[Rick]

How about Harley Davidson? One of the great brand transformations of all time. When AMF owned them the product was JUNK. Not sure about price, but it could hardly be premium because the product was absolute shit. The workers bought the company back from AMF and started to transform the brand. HD is now a premium brand in all respects of the word.

[Helix]

Gallo Wine.

[mks57]

so then what would be some examples of companies that have went from high price and high quality to low price and low quality. What comes to mind here for me would be companies that specialize in clothes. For instance Tommy Hilfiger and Polo clothes. What about computers like Dell?

This happens to many high tech products when they become mass-market commodities. Floppy disk drives are a good example. They used to cost $500 each, when $500 was worth a lot more than today. They were designed to last and to be repairable. When they wore out, you could send them in for an overhaul. Prices, and quality, declined over the years, although storage density improved. They became throwaway items, not designed to be adjusted or repaired. Pricing pressures became extreme and resulted in today's product, which is very cheap and has marginal reliability. Cheap products that are "good enough" often drive better products out of the marketplace.

[Quercus]

Well, if you also accept 'quality' (in quotes), then perhaps Rolling Rock beer is an example: it used to be a cheap regional brand, just like Genesee, Iron City, Narraganset Bay, Lone Star, etc. etc.
Now, though I doubt the actual product has changed, it sells for yuppie beer prices.

There are also even more extreme examples in the liquor world, vodka especially, where tripling the price of a brand (without changing the product) causes huge increases in sales.

[Billdo]

If you're looking at the apparel industry, you may want to try Barneys. It was originally a discount mens clothing retailer and has changed in the last 15 years or so to being a high-end fashion shop.

[MissGypsy]

so then what would be some examples of companies that have went from high price and high quality to low price and low quality. What comes to mind here for me would be companies that specialize in clothes. For instance Tommy Hilfiger and Polo clothes. What about computers like Dell?

How about Joe Boxer? They used to be fairly decent quality and medium-priced, and now they're noticeably lower-quality and less expensive since Kmart sells their stuff.

[Metacom]

so then what would be some examples of companies that have went from high price and high quality to low price and low quality.
Sears in general, especially their Craftsman tools (well--maybe it was more of a mid-price, mid-quality to low-price, low-quality, but still).

[RealityChuck]

Pepsi Cola. It was originally sold as a low-price alternative to Coke:

"Pepsi Cola hits the spot
12 ounce bottle that's a lot
Twice as much for a nickel, too.
Pepsi Cola's the drink for you!"

As you can see, their main claim was that they gave you twice as much for the same price.

Later, Pepsi decided that being cheap meant you'd lose out to anyone whoever could beat your price, so they switch to being a premium cola.

[KP]

I don't know about the actual quailty and price, because I was a kid, but in the 1960s, RCA was considered a top notch brand, at least in the South. For the past decade, however, I've considered it among the lowest quality brands, cutting corners on features and sepcs, and with a high premature failure rate.

[GarthAlgar]

Honda and Toyota are good examples but I think the best would be Volkswagon. They went from the bottom of the barrel $1000 Beetle to high quality and high price (Passat, Toureg) in about 30 years.

[ftg]

Honda and Toyota are good examples but I think the best would be Volkswagon. They went from the bottom of the barrel $1000 Beetle to high quality and high price (Passat, Toureg) in about 30 years.

The annual car issue of Consumer Reports has found VWs seriously lacking in quality in recent years. Much worse than most other imports.

[kunilou]

Just as Japanese electronics has gone from low-quality to high, U.S. electronics has gone from high to low. RCA and GE televisions were the gold standard for a couple of decades -- now they're cheap commodity products and pretty interchangable parts.

Mercury and Oldsmobile were originally much higher-end than Ford and Chevrolet. Now Mercury is pretty much interchangable with Ford, and Oldsmobile has, of course, gone the way of DeSoto.

Then there's Levi's. Originally low-cost, high-quality, they got trendy in the 1970s and now seem to be sliding back again.

[Metacom]

The annual car issue of Consumer Reports has found VWs seriously lacking in quality in recent years. Much worse than most other imports.
The Passat is usually an exception to the "CR doesn't like VW's" rule, even in recent years. I only remember this because I bought a Passat Wagon partly because they rated it well.

[Running with Scissors]

Right. Also, when CR talks about quality, they're generally talking about reliability. Ferraris aren't particularly known for their reliability, but I don't think most people would consider them "low quality".

[elmwood]

Marantz used to be known for durable, high-end, audiophile-quality equipment. In the late 1970s, their reputation sank, as did the quality of their gear, as they tried to appeal to a broader market. In the past decade or so, Marantz turned around its reputation, and is now known for high-end stereos and amplifiers again.

Audiovox used to be known for cheap low end car audio equipment; their name was laughed at. Their equipment has improved in recent years, and they're making some decent specialized equipment such as satellite radio receivers. (Either that, or the name is being used to brand better but still commodified gear.) They're now positioned at the bottom of the middle end.

[Snickers]

How about Harley Davidson? One of the great brand transformations of all time. When AMF owned them the product was JUNK. Not sure about price, but it could hardly be premium because the product was absolute shit. The workers bought the company back from AMF and started to transform the brand. HD is now a premium brand in all respects of the word.

Is this true? My parents-in-law ride Harleys, and even they'll admit that their motorcycles really don't hold a candle to those manufactured by foreign companies, quality-wise. While HDs might be of better quality now then they were, I don't know that I'd consider them high quality. Conventional wisdom (that I know of, anyway) seems to suggest that you buy an HD because you want the name (and that stupid "sound," after drilling out the damn pipes), but not because you're expecting a quality bike.

[Cervaise]

Fast food chain Jack-in-the-Box has been making noises off and on for the last couple of years about going upscale: leaving behind cheap burgers and fries and offering salads and "true entrees." Seems to me the actual move in that direction has been rather half-hearted, but the intent was there.

[Balthisar]

If you need the opposite, how about Cadillac division? Caddy's used to be top of the line, and everything else was judged on Cadillac (wow, that's the Cadillac of eyewear!). Now, they're (mostly) just rebadged versions of GM's cheaper cars.

Foster Grant's another ex top-of-line that's now cheap-o.

Apple used to be a premium brand that only knowlegable people with taste and money could afford, but now you can get 'em dirt cheap. Difference here, I guess, is that the quality is still better than anything else on the planet… so I guess this doesn't count.

All kinds of top-down examples, not too many bottom-up. Let’s try to stick to the OP, then: I guess I can't really think of too many that haven't been mentioned. The most compelling example would be just about any Korean auto manufacturer. They're still lacking in quality metrics, but they're certainly gained the perception of being a good value. People that pay cheap prices don't mind inconvenience, as long as the warranty fixes it "free."

[Necros]

If you need the opposite, how about Cadillac division? Caddy's used to be top of the line, and everything else was judged on Cadillac (wow, that's the Cadillac of eyewear!). Now, they're (mostly) just rebadged versions of GM's cheaper cars.

I guess you're justifed in thinking this if you have been living in a hole since the mid-80s Cimmaron came out. But, except for that car and the Escalade, AFAIK, no cars currently in the Cadillac lineup, or ones that have been there in at least ten years, are rebadged versions of cheaper GM cars.

[Barbarian]

Is this true? My parents-in-law ride Harleys, and even they'll admit that their motorcycles really don't hold a candle to those manufactured by foreign companies, quality-wise. While HDs might be of better quality now then they were, I don't know that I'd consider them high quality. Conventional wisdom (that I know of, anyway) seems to suggest that you buy an HD because you want the name (and that stupid "sound," after drilling out the damn pipes), but not because you're expecting a quality bike.
I concur. If you want a high-end bike, you go for an import. If you want something that you can tinker with in your driveway, you buy American Iron.

[Balthisar]

I guess you're justifed in thinking this if you have been living in a hole since the mid-80s Cimmaron came out. But, except for that car and the Escalade, AFAIK, no cars currently in the Cadillac lineup, or ones that have been there in at least ten years, are rebadged versions of cheaper GM cars.

Okay, I wasn't being 100% fair to GM. They don't do true badge engineering on the Cadillac. They do common platform integration, meaning that it's not badge engineering. It's, say, the same difference between a Town Car and a Crown Vic on the Ford side. I tend to forget my audience at times, and as such there's no literal truth in saying a Caddy is built on a cheaper car's platform. There is truth in saying that cheaper cars and Cadillacs share platforms, and in many cases the platforms were designed to suit the needs of all cars from the concept phase.

That being cleared up, there's nothing special about a Cadillac these days. It's a run of the mill car. Note I'm not saying they're run of the mill, austere vehicles. They're now easily attainable by all but the lower classes. I'm not trying to criticize GM in saying this; in the face of pseudo-luxury Japanese cars (true badge engineering in many of their cases), it was a brilliant strategy to cheapen the marque such that virtually anyone but the poor could afford to have one. The Cadillac name, for the time being, is still very, very strong. Even so, Cadillac already has lost a notable degree of the man-on-the-street prestige it once garnered due to this, but prestige is nothing compared to profit. I could re-refer to my comment about Apple computers in my previous post (even though it was tongue-in-cheek, there's truth behind it).

[ralph124c]

How about Hyundai cars? In the 1980's they were unreliable junk. People would drive them for 12-15,000 miles and find their engines burning oil, brakes shot, multiple electronics failures. Also, the bodies rusted.Now, Hyundai cars are starting to approach the japanese standards of quality. They are still not as refined, but lightyears ahead of where they were 20 years ago. VW seems to be on a roller coaster-they made good cars in the 1960's-then they came out with dreadful cars in the 70's (the VW squareback had an AT that would self-destruct (repair was impossible)). Lateron, they got considerably better..but lately, VW has been building cars that have been plagued by numerous, expensive problems. The PASSAT is pretty good, but the JETTA is a terrible car.

[Necros]

Okay, I wasn't being 100% fair to GM. They don't do true badge engineering on the Cadillac. They do common platform integration, meaning that it's not badge engineering. It's, say, the same difference between a Town Car and a Crown Vic on the Ford side. I tend to forget my audience at times, and as such there's no literal truth in saying a Caddy is built on a cheaper car's platform. There is truth in saying that cheaper cars and Cadillacs share platforms, and in many cases the platforms were designed to suit the needs of all cars from the concept phase.
Let's take the Sigma platform for example. It's the platform the CTS, the SRX and the new STS are built on. As far as I know, it's only used on those Cadillacs. Saab was looking at the platform, but that's wasn't for a cheaper car. The XLR is built on a Corvette platform, and Corvettes ARE cheaper than XLRs, but it's a Corvette. I mean, it rocks. The Escalade I already conceded. The current Deville is built on GM's G platform, which is used in the Park Avenue, and Le Sabre, I think. So, yeah, Cadillac's most obsolete car, and one truck (why is Cadillac making trucks?) use platform sharing. None of its new ones are "contracted out" to lesser cars.

Sorry, my hijack is done. And no, I don't work for Cadillac. ;)

[FilmGeek]

Another "low price" and at least percieved low quality is New Balance shoes. You used to be able to get New Balance at Wal-Mart for $10 and they were percieved as the "poor kids" shoes (at least, they were when I was growing up).

They are the high end running shoe company. Very high quality, imo.