I like GoPro ($GPRO) and its products, believe me. Its marketing concept is brilliant- selling a lifestyle, rather than a product. While I might go buy a GoPro camera of my own, I won’t be buying the stock anytime soon.
For one, I can’t commit any extra capital at the moment since I am fully allocated in my positions. But two, the S&P 500 just made a big run and is becoming overbought. I also want to avoid buying a one-trick pony, even though GoPro’s lineup of cameras is impressive.
I am not sure yet how much it costs GoPro to make one of their cameras, but let’s say it costs them $200.000 to sell the “Surf Bundle” above (a conservative guess).
That means they are still getting 100% margin if someone were to purchase the Surf Bundle at $399.00. That is, if the consumer buys it. Pretty expensive toy if you ask me.
Now, if you are leaning the other way on $GPRO, and feel it has no place in your portfolio, just remember that they have a pretty viable marketing campaign. The way that they use real customer’s GoPro shots to promote the brand is extremely effective.
I know this much, it makes me want to go out and buy a GoPro every time. I am sure others feel the same way, if only they could find a way to use it. The target market might be small, but there’s something to be said for the fun & excitement that GoPro creates.
If it can become a household name, rather than just serving a niche community of random action enthusiasts, the sky is the limit for GoPro.