Logitech Analyst Day Notes

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This post is part of a series of posts called “Company Notes.” These posts contain quotes and exhibits from earnings calls, conference presentations, analyst days and SEC filings. The quotes are generally pieces of information that I find interesting or helpful to understanding the company, industry or economy and are not meant to provide summaries of the full content of the call. Other posts in this series can be found by clicking here. Full transcripts can be found at Seeking Alpha.

“we missed something which we were slow to react to the transition that happened with tablets. So as tablets really took on a completely life of their own, we were slow to react and we missed opportunity. The early stage of opportunities in the tablets, we just missed that opportunity.”

“we lost something very important. And fortunately we didn’t lose the capability, we lost the expectation. We stopped expecting to have great products…The products we launched became not so interesting. And I think we lost a little bit of brand relevance during those two to three years.”

“Today I am going to tell you, we are back.”

“I see big disadvantages inherit in big companies especially when it comes to consumer products, the bureaucracy creation mechanism is awfully strong in a big company and we adapted some of that to our little small company and we’re headed right back to where we should be which is we are going to be a small company and we are going to be a small company no matter big we get. Small means informal, small means fast in decision making, it means responsive. it just means you’re a learning company. You’re close to your customer. You’re close to you technologies so that’s where we’re headed.”

“product lifecycles are getting faster. The personal computer product lifecycle was about 24 to 36 months…tablet form life it can be as little as 18 months maybe over the future will even be 12 and on average today it’s probably 24 months”

“What it means is we have to be very fast in getting to market when the new form comes out because the life of that product is shorter so to get the best return on investment and have the biggest impact on the marketplace we need to be there almost from the beginning.”

“the whole operating model or supply chain model [has changed]. In the old model, we would make it, we would design it in California or in Switzerland. We would then start manufacturing in China, we would move that to the port, we put it on a boat, we ship it for four to six weeks to one of our distribution location, it would move to the distribution location.

From the distribution location, it would go into a sales area a retailer distribution and then we finally make it to the store. A very-very long supply chain, okay if you are not, if the life cycle approximately is very long….The tablet business is quite different…we’re now designing and making in China, then we’re not putting it on a boat, its flying…It lands either directly into the retailer’s warehouse or into our warehouse is quickly deployed to the retail store.”

“Finally, in the old world honestly, deign wasn’t rewarded to the same extent…But now the standards have changed especially as this becomes a mobile product.”

“So we are going to move from being Logitech as it’s been an engineering led company with a great go to market capability. We’re going to become that but we’re also going to become a design company with the design company that really leverages technology, innovation and consumer insight.”

“the number of people who buy a tablet or an iPad today and actually use the keyboard with it is very small so it’s somewhere between 8% and 10%. The number of people who probably would if they are aware of it and it was presented to them at retail is at least double that.”

“our number one selling product right now in keyboards and desktops is actually a product used for the TV so an increasing number of people who bring their TV talking about the TV bring their computer their laptop connecting up to the TV and then sitting on the couch and surfing this is a phenomenon that started about four or five years ago and it just keeps picking up steam. It is in fact in the U.S. it was 8% of people doing that about three years ago it is 30% doing it now 30% to 31%.”

“When we look at the how consumers behave, we hear very often that consumers have been stopped using the PC for going on Internet…but if we look at statistics actually still most hours on the Internet on the desktop or the laptop because you want to stay long time on the internet it is still much more comfortable to be on your PC”

“I’ll talk more about where we launch keyboard which enable you to jump between devices.”

“Second big trend that is your living space is changing…your living space and your office space is merging…We need products that are beautiful to look at and you can be proud as a consumer and that reflects your personality.”

“18 months ago, we did a survey of iPad owners and 70% of them globally said they love the iPad exactly as it is, don’t need anything else, it’s perfect.

We repeated the same survey 12 months later. This time only 30% of consumers said they like the iPad as it is and 70% of them this time said they want more things around the iPad to accessorize it to make it more useful in new areas, in new use cases, inside the house, outside the house, different family members.”

“When we looked at what consumers were actually buying when they went to accessorize their iPads, four key things showed up consistently, no matter which country. One; a cover or a folio to protect it and also make it easy to use as a stand. Number two; a keyboard to make it productive as you are using it for email as well as other activities that you are typing in. Number three; pens or styluses most often used simply for selecting individual links on the screen. And number four; earphones or ear buds to enjoy music wherever you are around the world.”

“So we worked with leading scientists as well as fashion setters in the world to understand what are the next generation. Over the next 12 months, 18 months, what are the fashion trends going on in clothing, consumer products? What are the colors that are going to be in vogue this Christmas, next spring; and we have learned what are the most important things that we need to be looking to as we design our products in the future.”