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Ruslan Kogan hits back at Gerry Harvey with satirical advertisement

There is something endearingly cheeky about Ruslan Kogan, the founder of online retail upstart Kogan Technologies.

In June, we shared Kogan Technology’s very funny satirical advertisement for Minister Conroy’s ‘spams and scams’ internet filter. This was not the first time we caught a glimpse of the young entrepreneur’s sense of humour. In March 2009, his company introduced Australian consumers to the chuckle-prompting KEVIN 37 Plasma Television set for $900.

This week, following a not-too-carefully constructed remark from business icon Gerry Harvey, who reportedly described Kogan as “a con” to The Age,  the following commercial was aired during the highly anticipated (and highly watched) Ben Cousins’ documentary on Network Seven.

Kogan’s anti-advertising advertisement

Funny? Hypocritical? Pure viral marketing gold? That’s for you to decide. What’s more interesting about this public spat is the underlying question it raises. What drives consumers — expensive television advertisements to establish trust and, therefore, create the ability to sell products at a premium price or the opportunity to purchase online at discount rate?

 

  • Alex, Melbourne

    No one buys a TV because they were conned into it watching an ad on TV. They do their research.

    What you do get from major electronics retailers and brand name products is standards in quality and customer service. These two things are sorely missing from Kogans business model. Note: Not only does charge an inflated price for inferior quality priced – read: “value” – electronics, but when you factor in the high price of Kogans delivery fees, their products are comparable in price to many of the retailers they claim to outprice. In fact, for many of the impoverished customers of Kogan, the potential loss of the non-refundable delivery fees is enough for them to tolerate their inferior product rather than return it.

    I’m with Gerry on this one. If you are impressed by “the con” or his tactics, try it for yourself. There is absolutely nothing stopping you. Try his products at your own risk.

    [Reply]

    Big Aussie Reply:

    By the time Gerry and all his pre-baby boomer mates finally “get” the Net… it will all be over. You can still count on 1 hand the number of Australian bricks and mortar retailers with real, working , shopping carts online. It can obviously be done; check out the range online at Walmart. Distributor/Resellers like Kogan are just cutting out the multitude of middlemen between China and Australia, and we get to reap the benefits.

    The number of manufacturers in China (and Japan) who share technology is staggering to the average public. There are a very limited number of manufacturers of most technology products. These are then “marketed” under different brand/label packaging. The same thing happens in many different industries, not just the tech industry. Cosmetics is another awesome example.

    Usually the higher price (of superior brands) is a reflection of the marketing (and also some R&D) dollars spent on a product, to get it to the public. I have been associated with many different industries where more than 3 “marketing” companies shared a manufacturing plant and the stamps on a product were changed before dispatch; and that was all.

    I don’t see a $50 delivery fee from Kogan being that different from the delivery fee charged by the Big Retailers if you want your purchase delivered.

    Disclaimer:
    I have never purchased from Kogan or Hardly Normal; and am not employed by either. I wonder if Alex can say the same :p

    [Reply]

    William Busta Reply:

    ‘Usually the higher price (of superior brands) is a reflection of the marketing (and also some R&D)’ . . . R&D? How much does Kogan reinvest back into R&D?

    Kogan = empty pursuit of profit.

    [Reply]

  • http://twitter.com/CarboniteAU Arthur Koulianos

    Good on him for giving it back to the big guys.

    [Reply]

  • http://twitter.com/CarboniteAU Arthur Koulianos

    Great to see more competition and smaller online players putting up a fight with the bigger retailers.

    [Reply]

  • http://twitter.com/davekasriel Dave Kasriel

    Product peer reviews are really starting to drive consumers. As Kogan’s cartoon video demonstrates “Online I can do more research. I can read lots of reviews. I can read opinions from people that have purchased from online stores”. Kogan’s products are cheaper and you couldn’t expect them match the quality of your common retail brands, yet if the saving offsets the picture discrepancy and the product reviews are positive I would be very comfortable to make a purchase. If the product is not up to standard you might end up reading my review!

    [Reply]

  • http://www.agentsofchange.org.au/ Tian Yang

    Go Kogan!

    [Reply]

  • Frammon

    I don’t think you can compare the two as equals. Good on Kogan for letting people know there are cheaper televisions. But I’m in the market for an IPTV capable TV and couldn’t find one. There is also the issue of warranty and quality. It’s great that you can get a SAMSUNG or LG panel, but what about the rest? Where do you go to get a part of have something fixed? Are their services centres? The cost of actually buying the TV is tiny compared to the potential time and money it could cost you to have it fixed, repaired, etc etc.

    I think Gerry has done well because he competed well against the original establishment like the department stores. He went out on a limb to build remote stores away from established malls and focussed on a way to reduce prices. Now he’s seen as a tall poppy.

    Admittedly when I saw his advertisement for the 1300 numbers (smart numbers I think they were) I thought, c’mon Gerry you’re not in this market too are you!… but I have to say he has his place.

    And anyway why are they comparing Kogan with Harvey Norman? Bing Lee and JB HiFi seem to be better priced competitors and they too provide you with a shop that you can walk into if you want to see the TV’s or have an issue with them.

    Where are the faceless men at Kogan? hmmm? Show us your faces Kogan men

    [Reply]

  • William Busta

    Anthill pushing Kogan’s cart AGAIN?

    Me thinks Anthill may have some disclosing to do? Anthill, I would like to request a full disclosure. What IS the connection between the two parties?

    [Reply]

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