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How important are trade up/trade in policies
#1772367 10/17/11 05:09 PM
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Most must be familiar with various trade up/trade in systems from piano manufacturers; examples:

* The 'Steinway Promise' (trade up; often discussed here).

* Yamaha's Upgrade Bonus(trade in system already run a few times in Europe):
Yamaha Upgrade Bonus

* Bösendorfer 'Eintauschgarantie' (trade up from Yamaha to Bösendorfer):
Bösendorfer Eintauschgarantie

To draw a parlell with the automobile industrie:

* Many car manufacturers in Europe have trade in systems for cars from their own brand that are than sold under special conditions as used by the brand dealers; examples Mercedes Nearly New Cars or Volvo Select.

* Dealers reprenting brands that do not have such a system or even when having such a system but having to trade in a car of a different brand then collaborate with car traders who either are specilized in exporting to certain parts of the world or specialize in exporting used cars of specific types.

It is known here in Europe that if the the used or second hand channels dry up or are blocked substantially that then the sales of new cars suffers.

Now the questions for the piano market:

* Are these trade in/up systems useful?

* Would piano sales be stimulated if dealers/distributors/manufactures could facilitate in a better way trade in/up?

* Or on the contrary does this not matter a lot for piano sales because most piano buyers only purchase one item during their life?

Dealesr aswell as piano owner may ventilate their thoughts.

schwammerl.

Re: How important are trade up/trade in policies
schwammerl #1772463 10/17/11 07:47 PM
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I'll ventilate my thoughts.

Had such a program been available and the terms been reasonable, I would have been more likely to stay with a particular brand simply because the cost of trading up would have been lower. In my case, I went from Yamaha Clavinova->new C7->used C7->Mason BB as I advanced and also as I moved around. Had I been able for example to get a trade-in "credit" for my new C7 that I could use in the future for another Yamaha (or a Bosendorfer) I'd have been somewhat more inclined to stick with the brand.

Having said all that, when I bought my BB I played a number of different brands before deciding so it's entirely possible I would have elected to jump ship anyway laugh


Greg
Re: How important are trade up/trade in policies
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I think it's fairly important. I love my Kawai and may very likely trade up someday- just can't quite afford to YET..... Nice to know I wouldn't be starting from ground zero, if you will.


I don't care too much for money. For money can't buy me love.
-the Beatles



Re: How important are trade up/trade in policies
schwammerl #1773165 10/18/11 09:24 PM
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All the dealers pushed this on me, and I am of the view that it *does not matter at all*.
Sure, they give you an incredible trade-in value. But then, they're going to charge you list. Since a decent selling price of a piano is about 2/3's of list, and you're giving that up, what's the point?

So, e.g., you can get the full value of your Yamaha C-2 in trade, but you'll pay list for a C-7. Do the math...


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Re: How important are trade up/trade in policies
schwammerl #1773191 10/18/11 10:19 PM
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Qualia is right!

I am amazed when folks come into my store and inquire about this 'trade-up' option as though it is a great negotiating item.
It is sales tactics.
I will happily give a very attractive 'buy-back' price on which I will do no worse than break even, in order to sell a more expensive unit on which the margin is usually larger anyhow.

I always tell my customers who currently have a piano but are looking to upgrade for whatever the reason: sell your piano privately, almost always you will come out ahead. Of course there is the hassle which goes along with doing this and the time involved. If you assign a dollar amount to your time and effort, maybe the trade-in (trade-up) has some appeal. You have to weigh this for yourself.


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Re: How important are trade up/trade in policies
qualia #1774706 10/21/11 03:06 PM
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Originally Posted by qualia
All the dealers pushed this on me, and I am of the view that it *does not matter at all*.
Sure, they give you an incredible trade-in value. But then, they're going to charge you list. Since a decent selling price of a piano is about 2/3's of list, and you're giving that up, what's the point?

So, e.g., you can get the full value of your Yamaha C-2 in trade, but you'll pay list for a C-7. Do the math...


At the store where I worked, we marked the pianos with our discount price (about 1/3 off list); if a customer had a trade up, they were given 100% towards that price. What say you now?

Last edited by Cadillackid; 10/21/11 03:32 PM.

Former salesperson for Yamaha, Schimmel, Bosendorfer, Wm. Knabe, Kimball, Charles R. Walter, Mason & Hamlin, Roland and Korg.
Re: How important are trade up/trade in policies
JD Grandt #1774730 10/21/11 04:01 PM
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Originally Posted by newgeneration
Qualia is right!

I am amazed when folks come into my store and inquire about this 'trade-up' option as though it is a great negotiating item.
It is sales tactics.
I will happily give a very attractive 'buy-back' price on which I will do no worse than break even, in order to sell a more expensive unit on which the margin is usually larger anyhow.

I always tell my customers who currently have a piano but are looking to upgrade for whatever the reason: sell your piano privately, almost always you will come out ahead. Of course there is the hassle which goes along with doing this and the time involved. If you assign a dollar amount to your time and effort, maybe the trade-in (trade-up) has some appeal. You have to weigh this for yourself.


This is my view as well. It's also contained in a thread in the FAQ section.

How does buyback work?


Re: How important are trade up/trade in policies
qualia #1774816 10/21/11 06:45 PM
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Originally Posted by qualia
All the dealers pushed this on me, and I am of the view that it *does not matter at all*.
Sure, they give you an incredible trade-in value. But then, they're going to charge you list. Since a decent selling price of a piano is about 2/3's of list, and you're giving that up, what's the point?

So, e.g., you can get the full value of your Yamaha C-2 in trade, but you'll pay list for a C-7. Do the math...
This is certainly not always the case and completely false as a generalization. I know from personal experience that I got virtually the same price any customer would have gotten when I traded up. It was about the same discount from SMP that I got on the first piano from the dealer. Both discounts from SMP were well within the range suggested in The Piano Buyer and nowhere near SMP. The situation depends on the dealer.

Anyone who would agree to a trade up and pay full list price(except on a Steinway)must not know how to use the internet. It's not a secret today that the MSRP or SMP is almost always not the selling price.

If someone is concerned about the how the price on the traded up to piano will be determined, they should clarify that in the contract for the first piano.

Last edited by pianoloverus; 10/21/11 07:01 PM.
Re: How important are trade up/trade in policies
schwammerl #1774846 10/21/11 07:53 PM
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The value of the trade-up policy can be manipulated to be very strong or nearly meaningless with just a few choice words or fine print. We made a policy for our store that favors the customers because the reality is that a very small percentage of customers take advantage of it. If even 15% of our customers traded-up, we'd probably have to be more strict on our policy. I do think that the introduction of these policies is laying the groundwork for a greater trade-up occurrence in the future.

For us, the main value of a customer when they are trading up is the loyalty and enthusiasm that leads to more customer referrals. Customer acquisition costs tend to be very high on a per piano basis for those customers who are not personally referred. A high percentage of our trade-up customers really get to know us and become customer advocates for our business. It's hard to put a price on that.

"Would piano sales be stimulated if dealers/distributors/manufactures could facilitate in a better way trade in/up?"
I think this is a Pandora's Box simply because of tremendous variance service expectations as part of new pricing. Brand X sold at Costco, uncrated in the customers home, and tuned once by an RPT-in-training skews a lot of expectations. If service plans were the norm, then I think a manufacturer could look at buying cycles of 2-6 years from a first purchase and create that "certified pre-owned" store next door using incentives that would drive sales.


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Re: How important are trade up/trade in policies
schwammerl #1774852 10/21/11 08:06 PM
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I'm wondering if there are people who feel like the policy diminishes the dealer's credibility because they think it's a gimmick or somehow tacked onto the price?


Former salesperson for Yamaha, Schimmel, Bosendorfer, Wm. Knabe, Kimball, Charles R. Walter, Mason & Hamlin, Roland and Korg.
Re: How important are trade up/trade in policies
schwammerl #1774854 10/21/11 08:07 PM
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I will tell you my recent experience with this. I ended up trading in my 2008 Kawai for a larger model (at the same store where I bought it originally). They gave me the full original purchase price for my trade, and I also got a fair price on the new piano (more than 20% off Larry Fine's SMP). A lot probably depends on the dealer. Some will give you a fair deal, and others will try to bend you over.


Kawai RX-6 BLAK
Re: How important are trade up/trade in policies
PianoWorksATL #1774943 10/22/11 12:32 AM
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Quote
For us, the main value of a customer when they are trading up is the loyalty and enthusiasm that leads to more customer referrals. Customer acquisition costs tend to be very high on a per piano basis for those customers who are not personally referred. A high percentage of our trade-up customers really get to know us and become customer advocates for our business. It's hard to put a price on that.


It is refreshing to read that at least one dealer here is seriously thinking strategically about how to approach the piano business in the Western hemisphere where in many countries the number of younsters taking on the study of the piano decreases from year to year.

Sitting down and waiting for a young aged customer who acquired his first piano to outlive the life span of his instrument, to come back to the store and inquire for a new one because the first is due for replacement (= replacement sale), might well not work in the future anymore.

schwammerl.

Re: How important are trade up/trade in policies
schwammerl #1775265 10/22/11 05:04 PM
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I have a question for a closely related topic. I signed a rental contract last week for an upright piano, which should hold me over until I can afford a nice baby grand in a few months or a year. The rental agreement includes 100% credit to the price of any other piano at that dealership. The dealership is small and I did not expect them to have the piano that I really want. But, by total luck, it they do have the exact used baby grand that I want, priced at $10,000. The same model piano (used) is available at another dealership for $8,000, and the room for price negotiation at the $8000 dealership is effectively "we can offer an extra free tuning and make a deal for a nicer bench", and the price is right according to Larry Fine's book; that dealer has a reputation for realistic pricing.
I should be able to negotiate the price of the $10,000 piano down to $8000, especially because I took a photo of the $8,000 piano with the pricetag on it (pricetag includes model info). So, would a dealer be willing to honor the rental credit and negotiate the price down to the realistic level of $8000? If so, I could effectively get the piano for $7000 because I will have about $1000 in rental credit.

Re: How important are trade up/trade in policies
Maxtor #1775389 10/22/11 10:03 PM
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Originally Posted by Maxtor
I have a question for a closely related topic. I signed a rental contract last week for an upright piano, which should hold me over until I can afford a nice baby grand in a few months or a year. The rental agreement includes 100% credit to the price of any other piano at that dealership. The dealership is small and I did not expect them to have the piano that I really want. But, by total luck, it they do have the exact used baby grand that I want, priced at $10,000. The same model piano (used) is available at another dealership for $8,000, and the room for price negotiation at the $8000 dealership is effectively "we can offer an extra free tuning and make a deal for a nicer bench", and the price is right according to Larry Fine's book; that dealer has a reputation for realistic pricing.
I should be able to negotiate the price of the $10,000 piano down to $8000, especially because I took a photo of the $8,000 piano with the pricetag on it (pricetag includes model info). So, would a dealer be willing to honor the rental credit and negotiate the price down to the realistic level of $8000? If so, I could effectively get the piano for $7000 because I will have about $1000 in rental credit.

That's a tough call. Price matching is pretty easy with new pianos but it gets trickier with used stuff; to say two used pianos are "exactly the same" is pretty tough to evaluate. On the other hand, it may be that the dealer you're dealing with has overpriced his piano.


Former salesperson for Yamaha, Schimmel, Bosendorfer, Wm. Knabe, Kimball, Charles R. Walter, Mason & Hamlin, Roland and Korg.
Re: How important are trade up/trade in policies
Maxtor #1775578 10/23/11 09:22 AM
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Originally Posted by Maxtor
I have a question for a closely related topic. I signed a rental contract last week for an upright piano, which should hold me over until I can afford a nice baby grand in a few months or a year. The rental agreement includes 100% credit to the price of any other piano at that dealership. The dealership is small and I did not expect them to have the piano that I really want. But, by total luck, it they do have the exact used baby grand that I want, priced at $10,000. The same model piano (used) is available at another dealership for $8,000, and the room for price negotiation at the $8000 dealership is effectively "we can offer an extra free tuning and make a deal for a nicer bench", and the price is right according to Larry Fine's book; that dealer has a reputation for realistic pricing.
I should be able to negotiate the price of the $10,000 piano down to $8000, especially because I took a photo of the $8,000 piano with the pricetag on it (pricetag includes model info). So, would a dealer be willing to honor the rental credit and negotiate the price down to the realistic level of $8000? If so, I could effectively get the piano for $7000 because I will have about $1000 in rental credit.
How could anyone know the answer to this? It depends on the dealer.

Last edited by pianoloverus; 10/23/11 09:23 AM.
Re: How important are trade up/trade in policies
pianoloverus #1775804 10/23/11 05:23 PM
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Originally Posted by pianoloverus
Originally Posted by Maxtor
I have a question for a closely related topic. I signed a rental contract last week for an upright piano, which should hold me over until I can afford a nice baby grand in a few months or a year. The rental agreement includes 100% credit to the price of any other piano at that dealership. The dealership is small and I did not expect them to have the piano that I really want. But, by total luck, it they do have the exact used baby grand that I want, priced at $10,000. The same model piano (used) is available at another dealership for $8,000, and the room for price negotiation at the $8000 dealership is effectively "we can offer an extra free tuning and make a deal for a nicer bench", and the price is right according to Larry Fine's book; that dealer has a reputation for realistic pricing.
I should be able to negotiate the price of the $10,000 piano down to $8000, especially because I took a photo of the $8,000 piano with the pricetag on it (pricetag includes model info). So, would a dealer be willing to honor the rental credit and negotiate the price down to the realistic level of $8000? If so, I could effectively get the piano for $7000 because I will have about $1000 in rental credit.
How could anyone know the answer to this? It depends on the dealer.


Well, I might at least advise him to speak with the dealer and explain his dilemma; tell the dealer "I'd like to continue to do business with you but I found a similar piano for less money etc. what if anything can we work out here?"


Former salesperson for Yamaha, Schimmel, Bosendorfer, Wm. Knabe, Kimball, Charles R. Walter, Mason & Hamlin, Roland and Korg.

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