Pricing niche products: Why sell a mechanical keyboard kit for $1,668? - by Kevin Lynagh

Article by Kevin Lynagh

https://kevinlynagh.com/notes/pricing-niche-products/

Yeh, saw that pop up on reddit awhile back. Personally I can’t even fathom paying that much for a keyboard, nevermind selling a board for that much. Like that’s 3-4months of bill money for me. From the selling standpoint, I just can’t think of how I’d be willing to make someone pay that much for something.

3 Likes

You will notice that a lot of keyboard enthusiasts are clustered in tech and banking areas (NYC, SF, LA, etc.) Meaning a lot of the high end customs go to people who both live in high expense areas and are used both earning more and spending more.

There are plenty of enthusiasts that make more normal incomes, but the people who pay $1600 plus for a keyboard are in their own class. I would not feel guilty selling to them at all.

I don’t know if you’ve noticed but the folks who buy and sell these high priced objects often list several at the same time! They always sneak in a humble brag somehow…

“I am sorry to see this Duck go, but I don’t use it anymore now that my Alice and Keycult #1 take all the room on my desk. I suppose I would accept a trade for an LZ but only in grey because I already have one in black and one in red with a custom weight made from polished silver.”

Who are these people and how can I become one of them?!

4 Likes

As a recovering ex-tech ex-big-metro ex-spending person (a mortgage and a kid fixed that right up), you nailed the answer in your post:

You will notice that a lot of keyboard enthusiasts are clustered in tech and banking areas (NYC, SF, LA, etc.) Meaning a lot of the high end customs go to people who both live in high expense areas and are used both earning more and spending more.

You become one by moving to one of these places and working in a high-income industry! That’s not very helpful, though.

Anyway, the amount folks dropped on that Vickrey auction is about what folks drop on streetwear like early-era Yeezys or Off-White. It’s also dwarfed by watches: a pre-owned Rolex Sub starts around $5-6k depending on condition, an Audemars Piguet Royal Oak breaks $10k easily. This is just par for the course with high earners. Stuntin is easy when you pull down a quarter-mil a year.


There was some discussion of sneaker culture in Kevin’s post, but I think the split pricing model lets Keycult scale their business while still serving the average keyboard fan. As of today, folks have two paths to acquiring Keycult kits:

  • Everyone has an equal chance to win a raffle, or, if you’ve got it;
  • spend a fuckton of money.

The latter might leave a bad taste in the mouths of some, but it’s transitional - Keycult needs money to scale their operations and manufacturing. On Keycult’s Discord today Jorge said:

That’s what we think (that there will come a point where we make enough boards that vick doesn’t make sense).

I buy this. Completely made-up numbers, but let’s say KC makes 15% net margins on their boards. 85% then go to various costs: $500 * 0.85 = $425. The net margin on a Vickrey No1.1 board is then $1668 -$425 = $1243 / 1668 = 74.5%. In this contrived example (with made-up numbers!!), one Vickrey board yields the same margin as 16 raffled boards. That’s one way to scale your business quickly!

People may hate missing out on No 1.1 this time around, but they’ll love having their pick of future products in, say, 6-12 months instead of several years. This wouldn’t be possible without auctions.

4 Likes

I actually have no objection to the high prices. I think people are recognizing craftsmanship and design, which I support.

In an era of mass produced everything I think it great folks are appreciating workmanship. I just wish I could afford more of it :slight_smile:

3 Likes

We don’t win until the public is vaguely aware that there are viable alternatives to keyboards that suck.

I’ll never own a Keycult, but I’m glad it exists. I’m happy that there are plenty of folks who want a collection and ensure a constant churn of product.

I believe that our niche hobby is influencing the direction of the mass producers. That Ducky is selling through a 60% to kids and that Razer is now making a model that addresses many of the concerns hobbyists had, is encouraging.

The more folks we bring into the fold, the more viable the high-end will be. There is a place for expensive, meticulously designed, and durable gear. A keyboard that will last a lifetime or more should be an obtainable good, and I’m glad it is.

5 Likes