I understand that the product lines (105, DuraAce, etc.) are ranked in terms of quality, and that last years high model drops to this year's low model. Could someone lay out the logic for the naming system so I can understand it?
For road components Shimano has the following quality ranking, from top to bottom and from (very) expensive to cheap: Dura Ace Di2, Dura Ace mech., Ultegra Di2, Ultegra mech., 105, Tiagra, Sora and Claris.
What trickles down from year to year are the innovations. If some innovation appears with the pro-groupset Dura Ace it will appear in the following or second year in the Ultegra group and so on downwards while the the Dura Ace components have some further improvement.