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[Bar-B-Lew]

I got all of the data from D & B Hoovers website (Dunn and Bradstreet data base). I am not 100% sure how accurate or up to date the numbers are, but I went with what they had. Take it for what its worth. I'm just trying to show that Traeger still has a majority market share and that on the grand scheme of things, pellet cooker companies are not all as big as you would think.

D&B information is not trustworthy for just about anything IMO in dealing with them over the years.  They have limited access to information and distribute it as if it was gospel.

[Bobitis]

Great replies all. What a well informed group we have HERE.

I never heard of a pellet smoker until about 5 years ago when we gave a Traeger Jr at werk. At that time I was really tired of baby sitting my WSM, so I checked it out. The thought never crossed my mind to dig a little deeper than Traeger. I saw it, it looked cool, got free shipping on Amazon and here I am today. I never heard of Traeger prior to the give away.

That said, I don't believe there was another comparably sized pit made by anyone else at the time. I simply don't have the need for a larger smoker than what I have, and the Davey Crocket doesn't werk at all for me. In my case there's simply not another more better option. I do believe I'm in the minority when it comes to any sort of outdoor cooking enthusiast regardless of fuel choice.

All roads do not lead to Rome. Mass marketing is a great tool when pointed at the 'see all, believe all' consumer. Yet I have to wonder that anyone willing to shell out $600.00+ for a pellet smoker wouldn't do a little research.  It's simply to easy to google 'pellet smokers' and get 21,000,000 results.

I hope the guy makes it as it will be better for all consumers. IF they're not to lazy to do a little research. It's capitalism at its finest. The bar has been raised yearly across all manufacturers. Can Traeger keep up? Not that I can see. It appears they are at least trying.

 

[silverbullet]

I agree that its all in the marketing. As a motorcycle guy for 40 years here's an example,

Honda makes GR8, reliable motorcycles yet so many of its models have gone away because they don't know how to market a Very, Very good product!

Harley on the other hand makes a mediocre product but markets a lifestyle around their product which has been Very, Very successful over many decades!

Traeger will continue to do well because people buy on impulse. If someone continues to see something in front of then & like it they will buy it.
The person who wants to get into pellet cooking & does his/her homework on different pits will probably not buy a Traeger. A person looking to buy/replace their current pellet smoker are also unlikely to buy another Traeger.

[kingrude1]

With the cost of pellet cookers and the wealth of information online, I suspect many new buyers are going to do their home work before making such a big purchase, in doing that research I am not sure that the Traeger brand is going to jump out at them as the one they need to buy, there are cheaper and better units all over the place now to compete against them.

[Kristin Meredith]

With the cost of pellet cookers and the wealth of information online, I suspect many new buyers are going to do their home work before making such a big purchase, in doing that research I am not sure that the Traeger brand is going to jump out at them as the one they need to buy, there are cheaper and better units all over the place now to compete against them.

I agree with this analysis.  Your average gas grill person is spending about $300 for a nice, shiny, easy to use and understand grill.  I know I am cheap, but even before pellet pits, I would not spend $300 on a grill.  That is a lot of money to me to cook burgers and steaks -- what most home grillers are cooking. Suddenly, they are suppose to just shell out $700 for something they have never really seen or heard about?  Maybe they will eventually put out $700, but I don't think it will be an impulse purchase, I think they will do a bit more research for that price point.

[MN-Smoker]

With the cost of pellet cookers and the wealth of information online, I suspect many new buyers are going to do their home work before making such a big purchase, in doing that research I am not sure that the Traeger brand is going to jump out at them as the one they need to buy, there are cheaper and better units all over the place now to compete against them.

The issue is, if people go home and google "Traeger" they'll find Traeger and buy Traeger. 
80% will buy on impulse.
RecTec is buying add space on google for Traeger so they show up, but the rest of page one are sites of Traeger, Traeger recipes, Traeger videos.

How many will go home and actually google "Pellet grill"?

For me it wasn't an impulse buy, but for many it is.  Just like some people will drive onto a car dealership lot and buy a car without looking or shopping anywhere else.
They'll buy someone who can fix their "problem" of needing a new car, and a way to afford it (financing). 

[Kristin Meredith]

For me it wasn't an impulse buy, but for many it is.  Just like some people will drive onto a car dealership lot and buy a car without looking or shopping anywhere else.
They'll buy someone who can fix their "problem" of needing a new car, and a way to afford it (financing).

So you were rational, but everyone else is just an impulse shopper?

[pmillen]

Marketing $$$, build sales.  Make it look like it's taking off like a rocket, IPO, sell stock and run.

Exactly.  Jeremy Andrus is probably following the new business model; Grow fast—Lose money—Go public.  That works because the venture capitalists that fuel the system aren’t any better than you and me at determining which companies will succeed big.  As a result, they invest in all of them.  They’ll lose a bundle on the losers but they’ll win hundreds of bundles on the winners.  “Spray and pray,” they call it—hoping that somehow, if only through dumb luck, some of their money will land on the next Facebook, and the payoff from that one hit will more than make up for the duds.  So, viewed in the composite, they look like shrewd investors.

They’re looking for unicorns—privately held corporations that supposedly are worth billions, even tens of billions, of dollars.  Fortune Magazine wrote that there are now 145 unicorns, nearly twice as many as existed only seven months before.  The wannabe unicorns make themselves look perfect by hyping sales growth and showing millions of dollars in operating capital.  What they don’t talk about publicly is the other side of their balance sheets and the fact that they’re hemorrhaging money.  They’ll be made whole (and then some) when their IPO stock is purchased at the level they require.

Here are some recent examples of the Grow fast—Lose money—Go public methodology.  One of the first money-losing unicorns to go public was PayPal.  The COO, Reid Hoffman, left a rich man in 2002 and co-founded LinkedIn.  In three of its thirteen years LinkedIn has reported an annual profit.  In the other ten, it has posted losses.  Recently the losses have been prodigious—LinkedIn lost $150 million in the first nine months of 2015.  Yet Hoffman’s net worth stands at nearly $5 billion.  Amazon, the online retailer, is twenty-three years old and has never made huge profits, yet its founder, Jeff Bezos, is worth $60 billion.  Salesforce.com, a software company, reported net losses totaling three-quarters of a billion dollars from 2011 through 2014, yet its founder, Marc Benioff, is worth $4 billion.  Not long ago Twitter was valued at more than $30 billion.  Yet it has never reported an annual profit, and has lost billions of dollars.  For eleven years Twitter has undergone wave after wave of management upheaval; hiring and firing CEOs, reshuffling, reorganizing, announcing new business plans, making acquisitions.  The people responsible for this mess have become incredibly wealthy.  Two of Twitter’s co-founders, Evan Williams and Jack Dorsey, are billionaires.

Dorsey was eventually forced out of Twitter and started a credit card processing and point of sale terminal company called Square, Inc. by raising $590 million in venture capital.  In November 2015 he successfully sold shares to the public, despite having lost nearly $500 million—half a billion dollars!—in just four years.  In 2015, Dorsey became CEO of Twitter again, so he now runs two companies.

Anyway, Andrus obviously has access to borrowed money, he was formerly with Solamere (Venture) Capital.  He can hype as well as anyone.  As MN-Smoker wrote this smells like another round of, “Marketing $$$, build sales.  Make it look like it's taking off like a rocket, IPO, sell stock and run.”

“Money for Nothing”
Mark Knopfler, Dire Straits

[rjp123]

I wown't buy one, but I'd invest in the company now if I could.  These guys are going to crush it.

[Kristin Meredith]

I understand what you are saying pmillen and this may be the same.  But selling a physical product -- like a pellet pit -- feels different to me than selling concepts and ideas which is what a lot of your examples involve.  Twitter might not make a profit, but millions use it and millions more have heard of it, so people think it is worthwhile investing in.  I don't know if that mentality translates to pits.  We shall see.

[pmillen]

Twitter might not make a profit, but millions use it and millions more have heard of it, so people think it is worthwhile investing in.

Yeah, that's the business plan's Marketing element, Grow fast.

I don't know if that mentality translates to pits.  We shall see.

Yes, we shall see.  Andrus has ramped-up the Marketing exponentially.  Wait for the commercials that show a family discarding a gas grill.  Super Bowl?

BTW, I need to stop ranting.  Thinking about the Silicon Valley crashes at the turn of the century gives me angina.  While this isn’t a direct copy of that, there are some worrisome similarities.  I'll never see Traeger's balance sheet but the recent expenses associated with the relocation and Marketing efforts would exhaust many companies revenue streams.


     Remember the abandoned Porsche with the Dot Comer license plate?

[Kristin Meredith]

     Remember the abandoned Porsche with the Dot Comer license plate?

No, but you're talking to a person who drives a 14 year old Chevy, still pays bills with a check and stamps, and feels that she has mastered everything there is to know about technology because she moved from a typewriter to a basic word processing program (and I still don't know how to move the margins).  But the way I look at it, I will be the leader when North Korea destroys our power grid with some fancy bomb I read about the other day.  You will all be wanting to know how to write in cursive and I will sell you my low tech knowledge!

[Brushpopper]

     Remember the abandoned Porsche with the Dot Comer license plate?

No, but you're talking to a person who drives a 14 year old Chevy, still pays bills with a check and stamps, and feels that she has mastered everything there is to know about technology because she moved from a typewriter to a basic word processing program (and I still don't know how to move the margins).  But the way I look at it, I will be the leader when North Korea destroys our power grid with some fancy bomb I read about the other day.  You will all be wanting to know how to write in cursive and I will sell you my low tech knowledge!

I'm with Kristin!  I learned how to type at a young age and write in cursive.  My 14 year old prefers a text over a hand written note in cursive.  She'll figure it out but ain't happy about it!

[wyd]

I have to say that was a very interesting article.  Overall I think the pellet grill community is growing each and every day but has a long way to go as many people still don't know what a pellet grill is or what its about.  Maybe Traeger grills are not the best overall but at the price point they're targeting and with strong aggressive marketing who knows what Jeremy can do with this company.

[Bentley]

I agree...but the pellet unit came out roughly the same time as the PC, a little later, but not much.  Can you imagine this statement being made about a PC?

Overall I think the pellet grill community is growing each and every day but has a long way to go as many people still don't know what a pellet grill is or what its about.