Hacker News new | ask | show | jobs
by varenc 297 days ago
IMHO this is a play that happens across industries. For example:

- Land Rover building reputation with their rugged Defender and then cashing in on that by pivoting to a far less capable luxury SUV. Same with most off road cars.

- North Face making serious mountaineering gear to suburban fashion brand with reduced quality.

- Blue Bottle going from a high quality local SF chain to scaling internationally under Nestle. (and quality taking a hit)

etc, etc...
3 comments
joegibbs 297 days ago
In business terms it makes perfect sense - if people care more about the brand and image than the actual reliability and quality of the product, why bother spending so much money on quality? Of course the brand will end up losing its appeal after a while, but there's always the next niche brand that can get scaled up.
link
bjt 297 days ago
Krispy Kreme donuts is my favorite example of this. When they opened their Utah store and turned on the "fresh" light they'd get people lined up out the doors. Then they started putting their boxes of donuts in every gas station and no one cares anymore.
link
jryio 297 days ago
A trend I have noticed as well. I consider this pattern to ultimately be the forcing function of free market capitalism itself.

Once a brand accumulates sufficient reputational capital through genuine quality, the profit-maximizing imperative inevitably drives extraction over quality. (I would extend this argument briefly outside of the domain of economic theory and into physics: we do not observe low entropy being temporally consistent anywhere in the universe.)

The market doesn’t reward maintaining expensive quality standards when cheaper alternatives can temporarily coast on accumulated goodwill - shareholders demand margin expansion, private equity needs returns, and the competitive landscape punishes companies that leave money on the table by over-investing in product integrity.

Less of a moral failure by individual companies and more structural incentive alignment: capitalism systematically rewards converting hard won brand trust into extractable rents until the reputation is depleted, at which point capital simply moves to the next target.

The pattern you’re observing isn’t a bug but the logical endpoint of a system that treats reputation as just another asset to be optimized for shareholder value rather than a covenant with customers.

link