The Pandemic Has Spawned Lots of New Audiophiles
(Bloomberg Opinion) -- Music amplifiers that sell for $17,000 (you need at least two of them) and speakers that cost $200,000? If you thought that the pandemic was killing retail sales, you may not have been looking in the right places. So says Jeff Poggi, this week’s guest on the Masters in Business podcast and the co-Chief Executive Officer of McIntosh Group, a manufacturer of audiophile components widely regarded as among the finest in the world.
The 70-year-old McIntosh Group just posted its best year ever for sales even though the company’s manufacturing plants were closed for four to six weeks in March and April. But starting in June, each month record a new record for sales. Poggi explains that as people were spending most of their time at home, they spent less money on discretionary entertainment purchases, meaning no concerts, shows or even vacations. As a result, people began to notice that much of their living spaces needed an upgrade. One of the biggest beneficiaries was home media rooms.
Consumption of both audio and video gear increased. Poggi says sales of vinyl records even surpassed those of CDs in 2020, which suggests the audiophile community is expanding. Similarly, with movie theaters considered pandemic health hazards and many shut, film and video consumption has also migrated to the home – another key driver of McIntosh’s business.
Be sure to check out our Masters in Business next week with David Welling, the CEO of Mercer Global Advisors Inc. The Denver-based investment advisers has manages more than $21 billion.
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Barry Ritholtz is a Bloomberg Opinion columnist. He is chairman and chief investment officer of Ritholtz Wealth Management, and was previously chief market strategist at Maxim Group. He is the author of “Bailout Nation.”
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