Price Cuts May Not Be Enough to Save Sales

Price Cuts May Not Be Enough to Save Sales

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Marking down prices on consoles might help sales this year, but it won't be enough to simulate sales the way companies are hoping they will, one analyst thinks.

Price cuts have historically been one surefire way to significantly boost sales of consoles, but it might not be enough this time around, analyst Doug Creutz of Cowan and Company thinks. That's because of the gloomy state of the economy, and the various financial pressures that consumers are facing nowadays. With all those compounded problems, it might take more than slashed price tags to liven up hardware sales.

"We are concerned that, given pressures on the consumer, price cuts may not have the stimulative impact to hardware and software sales that they have had in the past," Creutz told investors.

Not that there won't be benefits - there will be some, that is, if you think of price cuts as sure a thing as Creutz seems to. "We expect hardware price cuts on all platforms by September, with announcements possibly as early as next week's Gamescom," he said. Creutz predicted a $100 price cut for the PS3, a $50 drop for the Wii and Microsoft to drop the Elite to $300.

The Elite prediction in particular echoes rumors from yesterday which emerged from a retail catalog listing the Elite for that price, lending some weight to the rumor that the Elite would become cheaper and the Pro SKU would be entirely phased out.

Though the three console makers have consistently denied plans for price reductions or new models, I wouldn't be surprised if Creutz is right and we hear something before month's end. Price cuts might not be enough, but really, what else can you do?

[Via GI.biz]

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Price cuts seem to be the only way people are thinking, I'd go for a good bundle anyday. Give me a PS3 with a few acessories and Fallout 3 and Farcry 2 and I'll pay any price.

"Oh, people may still not buy consoles after a pricecut because the economy has gone to pot. What a clever dicky I am."

I sure hope these 'anaylists' don't get paid for these comments, as really, who could give a flying bananas what they think?

I found the price cut for the 360 fairly amusing, to be honest I wouldn't mind getting that if that cut comes to the UK, but it was surprising in a sense. I don't think a huge amount of people are going to flock to stores and buy them. It'll be problematic if the 360 is already starting to reach market saturation, because Natal is some ways away.

And that's a poor analysis IMHO, a Wii price cut in September? I doubt it. I think someone is scared of losing their job.

I agree with sevre though, bundles will do a much better job than cuts will. Look at the Black Wii with MH3 in Japan.

Well if every month someone guesses that a price cut will happen, one of them is eventually going to be right.

Sevre90210:
Price cuts seem to be the only way people are thinking, I'd go for a good bundle anyday. Give me a PS3 with a few acessories and Fallout 3 and Farcry 2 and I'll pay any price.

I concur with this post.

pantsoffdanceoff:
Well if every month someone guesses that a price cut will happen, one of them is eventually going to be right.

Yeah, proving that spouting the same nonsense over and over just might make it true. Maybe.

After months and months of calls for a price cut are SONY actually going to do it? I got my PS3 a couple of years ago so I'm not fussed but maybe it will get all the people "who said they would if" to buy one.

If Microsoft are phasing out the the Pro does that mean Elite is the standard? At $300 and a SONY price cut to $300 that's finally an even playing field, well at least monetarily.

I don't know, if the price for the Ps3 gets cut then I'll definitely save up the money to get an 80GB one.

It'll help sell a couple extras however this time of the year isn't exactly one of the main buying times.

Considering all the people on here who whine for a Ps3 price cut, I highly doubt these people are correct in their predictions.

If Sony did drop their prices, especially before the holiday season, then there would be a massive boost in sales. Just imagine it.

*finds a Ps3 with a copy of Infamous inside the Thanksgiving turkey* THANKS GRANDMA!

Something they can do to boost sales is release good fucking games. Price cuts can sometimes put stress on the company; just look at Sony and their >$3 Billion debt from selling the PS3 lower than production cost.

People might start buying consoles more if we actually got some quality games on the go, instead of a handful of good ones over several years.

So far I dont see sales being a problem for nintendo or microsoft a price cut is just a formaltiy because all products depreciate in value over time anyway

Yay, parrot what the CEO of the most profitable console company says! Well, at least it's better than ignoring him and making shit up instead...

TaborMallory:
Something they can do to boost sales is release good fucking games. Price cuts can sometimes put stress on the company; just look at Sony and their >$3 Billion debt from selling the PS3 lower than production cost.

Allegedly, Sony has gotten their manufacturing costs down to about $280 so they would make a profit at $300 MSRP.

I'm all for a ps3 price cut. More people to play online with.

Sevre90210:
Price cuts seem to be the only way people are thinking, I'd go for a good bundle anyday. Give me a PS3 with a few acessories and Fallout 3 and Farcry 2 and I'll pay any price.

they are doing that with the psp and it got me into buying one and is making me think of buying a new one being released soon (my current one is missing two pixels.... its old) but yeah a good bundle goes well

 

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