A Critical Look: How Horizon Could Take on Traxxas (And Win)

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In the battle for shelf space in hobby shops around the country, Traxxas seems to be the clear victor. It’s main competitors, ARRMA and ECX, owned by Hobbico and Horizon respectively, have a long way to go to catch up. However, I think Horizon Hobby has a dark horse capable of not only catching up to Traxxas, but surpassing them in popularity among hobby shops, and perhaps even consumers. That contender is Losi, and here’s how I would restructure Losi to take on Traxxas.

Step 1: Retire ECX

Oddly enough, this discussion around Losi has to begin with another Horizon Hobby brand: ECX.

ECX, or Electrix, as they were first known, is an albatross around the neck of Horizon. The brand was originally intended to either provide a hobby alternative to the toy store, or do battle with Hobbico’s Duratrax, depending on who you talk to within the Horizon organization. However, since ECX began, Duratrax stopped selling cars, and ECX’s prices have risen to the point they no longer compete with toy store prices. ECX has morphed into a Traxxas competitor, but they don’t match up well in the contest.

I’ve gone over ECX’s shortcomings before, and everything in that article is still a valid criticism. If the goal for Horizon Hobby is to secure the funds hobby shops are currently shoveling to Traxxas, they have to offer something equalling Traxxas’ products, and ECX isn’t it.

One could argue Horizon sunk a lot into brand equity, but one look at an ECX box shows even Horizon doesn't believe that. The ECX logo appears very small in the lower right corner, while the Horizon logo is prominently displayed in the top right, much larger. If Horizon believed ECX to be an important brand name, they wouldn’t be usurping the brand with their own. No, at at this point, Horizon believes themselves to be pot-committed on ECX. They need to shake themselves of that notion.

To be fair, ECX does have some cool ideas, like the AMP vehicles, and more specifically, the AMP MT Kit, but those could be replicated in the Losi line as well. Retiring ECX would free up R&D assets and funds to restructure Losi, not to mention ECX would be redundant by the time I'm done here, and therefore it has to go.

 Step 2: Build Upon A Classic

 The Losi XXX-T Sport RTR II

The Losi XXX-T Sport RTR II

Many fondly remember the XXX-T, a stadium truck Losi had in circulation around 15 years ago. If it sounds familiar, it’s because they revived the platform for their current XXX-SCT, a short course truck currently available from Losi.

Part of Traxxas’ success is their reliance on a singular platform for their more entry-level vehicles. The Bandit, Rustler, Stampede, and Slash all draw heavily on the same parts: suspension, transmission, and most of the vehicles use the same driveshafts and axles. Focusing on a single platform with multiple variations benefits everyone; the manufacturer has fewer R&D costs as well as production costs, hobby shops can stock fewer parts yet still service more cars, and consumers can transition parts from one truck to another.

This is where the XXX platform comes in. It’s already been developed into three of the four fundamental R/C vehicles (a stadium truck, a buggy, and a short course truck), so the only R&D would be forging a monster truck out of the platform. Minor modifications would still be required for all of the vehicles (namely transitioning to metric hardware and changing the offset of the wheels to match Traxxas, since it doesn’t make sense not to tap into that already-existing market), but it would be a much less expensive way to combat Traxxas, not to mention there are already aluminum hop-ups for that line. Why reinvent the wheel when you can just adapt something you have?

Step 3: Copy and Paste...

Once all four fundamental off-road vehicles are ready to go, there needs to be two versions of each: brushed and brushless. Sound familiar? It’s exactly what Traxxas does. The brushed versions can replace all the metal turnbuckles with plastic links, include a less expensive servo, and come with a NiMH battery (though it needs to be at least 3,000mAh; one could make an argument about six vs seven cells, and if it needs to be six cells to hit a price point, that would be fine with me). Include a 2A AC charger (Dynamite already has one ready to go; in fact, ECX trucks were shipping with it for a while). Losi would be beating Traxxas in the convenience factor; while slower, the AC charger doesn’t force the user to either purchase an adapter or run out to their car to charge their battery.

 Losi XXX-SCT

Losi XXX-SCT

 

VS

 Traxxas Slash

Traxxas Slash

The brushless trucks could come with a battery and charger too, but it would be better to instead keep the price-point lower and require both to be purchased separately. This allows the more high-end user to pick and choose between chargers, and offers the flexibility to run either NiMH or LiPo batteries, depending on the skill level of the user. Losi already has the Tenacity SCT and Tenacity MT, so four-wheel-drive vehicles are handled too. Done and done.

My ideal Losi line-up would look like this:

  Losi Traxxas
  Brushed Vehicles Hypothetical MAP Price Brushed Vehicles Current MAP Price*
Buggy Losi XXX-B $169.99 Traxxas Bandit $179.99
Stadium Truck Losi XXX-T $179.99 Traxxas Rustler $189.99
Monster Truck Losi XXX-MT $189.99 Traxxas Stampede $199.99
Short Course Truck Losi XXX-SCT $199.99 Traxxas Slash $229.99
  Brushless Vehicles Brushless Vehicles
Buggy Losi XXX-BX $289.99 Traxxas Bandit VXL $319.99
Stadium Truck Losi XXX-TX $299.99 Traxxas Rustler VXL $329.99
Monster Truck Losi XXX-MTX $309.99 Traxxas Stampede VXL $339.99
Short Course Truck Losi XXX-SCTX $319.99 Traxxas Slash VXL $319.99
4WD Monster Truck Losi Tenacity MTX $399.99 Traxxas Stampede 4X4 VXL $399.99
4WD Short Course Truck Losi Tenacity SCTX $399.99 Traxxas Slash 4X4 $399.99
*Current pricing at time of publication.

Note that all the Losi brushless vehicles I listed would not come with a battery and charger, but some of the Traxxas ones, namely the Bandit, Rustler, and Stampede VXL, still do, so their prices may change if Traxxas were to remove those items from the box. I also changed the names of the two Tenacity vehicles, and the brushless XXX-SCT, to better reflect a consistent naming convention throughout to help the customer understand, just from the name, what it is.

The goal here is to achieve parity with Traxxas, and this more or less does that for the core vehicles. We're not worrying about rock crawlers, onroad cars, or funny cars; just the stuff that sells.

Step 4: ...Then Pull Ahead

Here’s where Losi, and Horizon Hobby in general, has a leg up on Traxxas: radio systems. The Spektrum radio system, love it or hate it, is the most prevalent radio system in radio control, but its dominance isn’t on the ground — it’s in the sky. Packaging DSMR Spektrum radios with all versions of the Losi vehicles would be a great way to get Spektrum radios into the hands of beginners, which is great in and of itself, but offers an opportunity Traxxas probably won’t reciprocate: Bind-N-Drive (BND).

Right now, if a Slash 2WD owner wants to purchase a four-wheel-drive truck, they get a radio with it, and they are paying for that privilege. However, Losi could offer a BND version of their higher end vehicles (2WD brushless XXX’s and the Tenacity 4x4s), and lower the price on these versions, say $30, meaning it pays to stay within the Losi family.

The Spektrum DX6R

The Tenacity is, at the time of publication, the same price as the Traxxas Slash 4x4: $399.99. If Losi, in addition to the RTR version, offered the Tenacity as a BND, and dropped the price to $369.99, that’s huge. Much like Bind-N-Fly was a big deal in the late 2000’s and early 2010’s, Bind-N-Drive would really separate Losi from the competition and provide a savings for those who bought into the Losi ecosystem. It’s a soft lock-in, and unlike the lock-in Traxxas is attempting with their anti-competitive connector policy, this is beneficial to consumers.

This isn’t some far-fetched idea either: Horizon has already done it! Some Losi products were offered as Bind-N-Drive back in the day, and the Vaterra ‘68 Ford F-100 is currently for sale as a BND, and looking at the price difference between an RTR version of that platform and the BND version, it’s a difference of $60!

This ecosystem would also encourage consumers to upgrade their radios for more features, or more storage space for multiple vehicles, something most consumers don't do now, which would provide an additional revenue stream to hobby shops and Horizon Hobby alike. Transmitters like the DX6R, which looks like an expensive if unnecessary item now, could see a huge boost in demand because now people have a reason to get one.

Step 5: Reap The Rewards

In 2016, we spent more than $85,000 with Horizon for Traxxas products alone. There’s a lot of money no longer going to Horizon, since we’ve transitioned to purchasing directly from Traxxas (the explanation into why is long and drawn out, and not particularly pertinent to this essay). In any case, there’s definitely a hunger out there for someone to come up and challenge Traxxas for dominance. You can be sure it won’t be ARRMA, and ECX isn’t making any grand strides forward. A new strategy, a well-known and loved brand, and a company that isn’t afraid of putting themselves out there is the only way to take on the giant, and Losi/Horizon Hobby has the combination of assets to achieve the goal.

Admittedly, the proper vehicles and brand organization isn’t the only thing needed. Traxxas has succeeded because they know how to market themselves and their products better than anyone else in the business, and that’s going to have to be tackled at some point too, but it won’t mean much without the products to back up the ads.

At the end of the day, though hobby shops are seemingly closing at an alarming rate, we still have a huge role to play in how a brand is presented to consumers. Therefore, appealing to hobby shops is a good way to get in good graces with consumers as well. If Losi offers our customers a better value proposition than Traxxas, I could certainly see us stocking Losi in greater depth, and perhaps even switching entirely over to Losi in time — and that’s a lot of money for Horizon, especially because we won’t be the only ones switching.

Final Word

Traxxas for better or worse, is and will be, for the foreseeable future, the king of R/C cars. Horizon Hobby has an opportunity to eat into that lead, though, if they only have the fortitude to see it through. Losi was, and is, a popular brand with plenty of support from across the radio controlled spectrum. Some would point out Losi has attempted this kind of thing before (anyone remember the Speed-T, High Roller, or **shudder** the Strike?) and it didn’t go well. That’s true, but the problem wasn’t that Losi can’t do bashing — it’s that one-off vehicles, like those I just mentioned, weren’t part of a larger plan. They just threw them out into the world and that was that. Other than the Strike, most of Losi's bashers were well received at the time. They were just too short-lived. A grand strategy would solve most of those problems.

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It’s no secret I really love Horizon Hobby. I’ve been their cheerleader when they do well, and their harshest critic when they don’t (just ask our sales rep about that last part). Their philosophy runs parallel to ours, even more so than Traxxas’ does, and I want them to succeed. With the shift in our customers purchasing habits from aircraft to trucks and buggies, we’ve had to move away from Horizon’s products because they don’t stack up against their competition, and we pride ourselves on bringing our customers the absolute best values in R/C. By making Losi the marquee brand at Horizon for everyone, they could again find more of their products on our shelves, and I suspect we wouldn’t be the only ones for whom that statement rings true.