Consumer electronics is a hot topic when it comes to a discussion about efficient ownership. At one extreme, most electronics are commodities - distinguishable (or comparable) by their unique model numbers or SKUs. This makes them relatively fungible and easy to trade online. Computers are the exception as they can be highly customized, making their model numbers less significant and their trading more complicated.
Countering the ease of trade in electronics is the steep depreciation curve that exists across the category. Products are introduced more and more frequently these days, putting significant price pressure on the older models. As I explain in FutureShop, the key to leveraging the auction culture when it comes to electronics is to time the sale and replacement of your goods around the “sweet spot” between when a new model is released and when the prior model is still considered current. Swapping models during that period generally provides the greatest net value and is a good way to own rapidly evolving electronic products that you frequently use (like a cell phone, pda, or pocket digital camera).
Recently, several consumer electronics companies have introduced programs to further facilitate this concept.
CompUSA, one of the nation’s largest computer retailers just introduced a program where you can trade in products you purchased from them for new goods in the store. It’s called “Easy to eBay” and they sell the goods for you on eBay, giving you the choice of either store credit or cash in return. Sony just introduced a trade-in program for your camcorder. Here is an excerpt from their website regarding the program:
The Sony Style Camcorder Trade-Up Program
“Now you can trade in that old camcorder, help the environment, and receive Sony credit. Use the credit for a brand new Sony camcorder purchased online at SonyStyle.com. Click on ‘Get Started Now’ to complete the online estimator and get your estimated trade-up value.”
Watch for more electronics manufacturers and retailers to introduce similar programs as consumers come to expect this type of service as a key part of their shopping experience.
This past Saturday marked the 36th anniversary of Earth Day, a day dedicated to environmental awareness and education. This article in the Seattle Times mentioned FutureShop and its thesis as one of the “top five actions you can take to help both the planet and your pocketbook.” I agree.
As more and more people adopt the auction culture, we will begin to see a renaissance in recycling - but in a much broader and different way than we did in the past. Our past recycling initiatives revolved around the conversion on trash back into raw materials that could be reprocessed into useful things. Aluminum, paper, glass and plastic were core commodities associated with the past recycling culture. In the new auction culture, people will expand their notion of recycling to tangible products that still have useful purposes in their present form (unlike, for example, a used can of Coca-Cola). We are already seeing this with computers and other consumer electronics ( although products from a large percentage of programs targeting technology are not recycled but rather disposed of in an environmentally safe way).
As more people resell their under-utilized possessions rather than throw them away, less waste will be produced since these items will find their way to people who will use them rather than the dumpster. Unlike the prior recycling mindset which was solely driven by either a desire to behave in an environmentally responsible manner or by local ordinances that forced you to do the same, the new mindset will be driven in part by money. There is little direct or measurable benefit to the citizen who recycles newspapers or containers. There is, however, a direct and measurable benefit when you receive a check in the mail from a buyer of your old notebook computer.
Capitalism preaches that if people behave in a purely self-interested manner, such activity will ultimately benefit society as a whole. This axiom plays out in an ironic and powerful way with regards to the concepts in FutureShop. Look for a positive and meaningful impact on our environment as people seek to improve their lives through auction culture and our society begins to adopt the culture of selling our possessions rather that holding onto them until they need to be thrown away.
In the new auction culture, you are doing good whether you think of “green” as an environmentally friendly icon or simply as a synonym for cash.
