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Vendetta wrote:

Stark wrote:I love the projection by people like Kernel. He says 'rare thus must be good'. Who really thinks like that? That's right - idiots. Who bases a console purchase on which one is HARDEST TO FIND? Clearly this is the basis of Nintendo's strategy - to frustrate buyers in order to build a massive fanbase who can't give them money because they don't have a console!

The theory isn't that "rare=good" but the perception that the shops keep selling out creates an illusion of artificially high demand, which increases real demand because people want the shiny thing that everyone else is buying (whether they actually are buying in any volume or not, the perception that they are is there, because hell, they're always all sold out).

I've never seen any credible figures to prove that this actually works, but that's the theory.

There's at least one documented example of this kind of thing that I can think of off the top of my head. Going a few years back, a foreign brewer (I think it was Heineken) was trying to break into the Hong Kong market. Long story short, they paid off the bars to eave their empty bottles on tables longer after they'd been drunk, while still being regular in collecting those of competitors. Because everyone would see all these empty Heineken bottles all around, people had the perception that they were in high demand, because hell, look at all these bottles left from people who must have just finished.

Vendetta wrote:

Stark wrote:I love the projection by people like Kernel. He says 'rare thus must be good'. Who really thinks like that? That's right - idiots. Who bases a console purchase on which one is HARDEST TO FIND? Clearly this is the basis of Nintendo's strategy - to frustrate buyers in order to build a massive fanbase who can't give them money because they don't have a console!

The theory isn't that "rare=good" but the perception that the shops keep selling out creates an illusion of artificially high demand, which increases real demand because people want the shiny thing that everyone else is buying (whether they actually are buying in any volume or not, the perception that they are is there, because hell, they're always all sold out).

I've never seen any credible figures to prove that this actually works, but that's the theory.

I very much doubt that this is the case with the Wii though, given the rate that they really are selling at (and if there's constant low level stock everywhere, that means they are being produced and shipped at about the right rate to meet demand), the inevitable christmas demand spike, assisted no doubt by the new Mario game, is likely to push demand to a point way beyond what any company can sensibly ramp to.

That might work with impulse purchases, but my reading of the game console market is that the majority of people have a pretty good idea which console they want to buy, irrespective of the way they appear in the store or other intangible "presentation" factors. And the clueless ones who just want to buy one for their nephews' birthday parties or whatever will simply ask the sales clerk, because even the clueless ones know that it actually matters which console you buy. So unless you're paying off all the sales clerks to push PS3, this won't work.

Vendetta wrote:The theory isn't that "rare=good" but the perception that the shops keep selling out creates an illusion of artificially high demand, which increases real demand because people want the shiny thing that everyone else is buying (whether they actually are buying in any volume or not, the perception that they are is there, because hell, they're always all sold out).

So, this hypothesis of yours... it's kind of like a herd mentality? "Other people appear to be buying it, I might as well"? Only it falls on its ass because the whole point of the strategy, "getting people to buy my stuff", is directly hampered by removing said stuff from the stores. Unprepared buyers (a.k.a "impulse-buyers"), the people who would be most prone to this type of tactic, would not want to put the effort into buying the purposefully hard-to-find "stuff". They'd go: "Oh, this looks cool! Oh, it's not in stock. Eh." and move away.

Another hypothesis for how scarcity could work (not that there's any factual evidence that it does) would be the "Last in Stock" Effect. If you only have a few units in stock, people could think: "Oh, this looks cool! Oh, they have only a few left! Better pick one up before they're gone!" But again, there's no hard data that scarcity tactics, especially for high-price items (like electronics), work out in the long run.

BTW, the local EBGames that I always go to has done something rather interesting: they created an elaborate display for the in-stock PS3s, and they put all of the in-stock Wiis and XBox 360s in the backroom storage area. So when you walk into the store, you get the impression that they don't have anything but PS3s in stock, apart from the display/demo units. You have to ask the sales clerk for a Wii or an XBox 360, and then they'll bring it out of the back.

Not only that, but their XBox 360 display unit broke down weeks ago (at least), and they haven't bothered to replace it or even remove it. Instead, they leave it sitting there, broken.

Darth Wong wrote: Not only that, but their XBox 360 display unit broke down weeks ago (at least), and they haven't bothered to replace it or even remove it. Instead, they leave it sitting there, broken.

Well, that's not their fault. Only the reps from Microsoft are allowed to fix the demo units. It's the same with Sony and the PS3s. I don't know what Nintendo's policy is, but it's probably the same. Of course, the chances of a Nintendo console breaking...

My mates at EB tell me that the demo PS3s are firmware-distinct, and only play the specific demo disks given out by Sony marketing. Long story short, it's impossible to demo games for customers on them. Yay!

Stark wrote:My mates at EB tell me that the demo PS3s are firmware-distinct, and only play the specific demo disks given out by Sony marketing. Long story short, it's impossible to demo games for customers on them. Yay!

Pffftahahaha. Do they HONESTLY want people to not buy their console? It's like their Board of Directors have only Republitards as memebrs or something like that.

General Zod wrote:

lance wrote: Because PS3s are barely selling and tossing crap into the trash is likely cheaper than transporting said product across an ocean.

Which brings me back to the original point that they still have to pay the initial shipping fees to get them to the stores. Otherwise they'd never be able to even make the attempt to sell them to know they were doing badly.

You know I was originally replying to "Though I suspect Sony is holding back stock" and "Sony's already stuffed retail outlets with enough PS3's to meet demand and they're sitting on shelves." Which means that their are already PS3s overstocked on the shelves and had a hypothetical back stock. So I should have said -also their would be transport costs to take into account.

Elaro wrote: So, this hypothesis of yours... it's kind of like a herd mentality? "Other people appear to be buying it, I might as well"? Only it falls on its ass because the whole point of the strategy, "getting people to buy my stuff", is directly hampered by removing said stuff from the stores.

Unless you keep it up for a short period, and then ship a large quantity of product just in time for a consumer extravaganza like Christmas. Of course.

Now, I fully expect that Nintendo have been stockpiling at least some stock for christmas, because demand is going to go up anyway, and they'd be foolish not to have inventory available to try and meet it.