Caladax Posted February 28, 2012 Share Posted February 28, 2012 (edited) Look, I have no interest in this sale, or what it might mean, or fanboys vs haters. I just needed to point out that you guys arguing with Meldwyn are being nonsensical. The poster he was responding to was saying that items which are selling well can afford to go on sale, and thus are put on sale, and then said that we need to learn economics. Now, consider this: if an item sells poorly, you lower the price to drive up sales. Makes sense. however, if we listen to TheOnlyKyrenS, if an item sells well, you lower the price. Taking both together, no matter whether an item is selling well, or selling poorly, you lower the price. This makes no sense! If you want to increase sales, lowering the price can be a good idea, but TheOnlyKyrenS suggests that an item selling well means that you should lower the price. Following his reasoning, the price would quickly go to selling at cost, since lower prices would increase sales, which would mean it's time to lower prices again. If you notice, he backtracks (wisely) in a later post. Nothing against him, we all have thinking errors sometimes, but let's not compound it by arguing for a nonsense position. edit: http://www.giantitp.com/comics/oots0135.html Edited February 28, 2012 by Caladax Link to comment Share on other sites More sharing options...
Rgho Posted February 28, 2012 Share Posted February 28, 2012 (edited) ...but I can't think of a reason to use a "good selling" product to bring people in the door... You discount "good selling" (high demand) items to get people to your door for a deal on something they want, then you try to sell them more stuff. That's why LCD TVs were both the most discounted AND best selling items this last Christmas. Everyone put an item that they knew was in high demand on sale to get people to come to their store with the intention of selling them more things while they were there. Edited February 28, 2012 by Averran insult Link to comment Share on other sites More sharing options...
Cormey Posted February 28, 2012 Share Posted February 28, 2012 (edited) LOL, fanboys think of anything these days! To the rest of us, it's all about supply and demand. Game like Skyrim is STILL selling for 60 bucks, why? Cause the game is still selling at a good clip, no one skilled in economics is gonna drop the price when the game is still selling at a reasonable amount monthly. TOR is dropping quick. Next month you may find it in the 5 dollar bargain bin at Walmart. And you'll grasp at any straw you can find. Newegg has skyrim for $53, that's their standard price. They also sell TOR for $50. Love the standard 'next month' prediction, goes nice with all the 'TOR will be dead/F2P in the first month' predictions you likely latched onto. Edited February 28, 2012 by Cormey Link to comment Share on other sites More sharing options...
Tadshackles Posted February 28, 2012 Share Posted February 28, 2012 But but, the game is in great health and all, 2 mill subs and raising amirite? Inb4 the fanboys dismissing it as a non event. WoW is now F2P til level 20... Clearly it's dying, amirite? Link to comment Share on other sites More sharing options...
Juanxlink Posted February 28, 2012 Share Posted February 28, 2012 WoW is now F2P til level 20... Clearly it's dying, amirite? No idea, left wow years ago and never looked back, you feel like you need to say something else? I do see a big envy for WoW and its success, but hey, Im just nobody so its all right. Link to comment Share on other sites More sharing options...
Yuuj Posted February 28, 2012 Share Posted February 28, 2012 Hahahaha, I love threads like these. I like how it has been explained to death that this is just a temporary sale to boost subscription numbers so that more money can be made in the long run yet people are still arguing against it. It isn't a different model, it isn't apples to oranges, it is what is actually happening. The reason why the other thread that pointed out the game was on sale temporarily for a limited time isn't as popular as this one is because that one wasn't catering to the 'Tortanic" crowd. Link to comment Share on other sites More sharing options...
lowflyingmeat Posted February 28, 2012 Share Posted February 28, 2012 (edited) "OH MY GOD LOOK, THIS FRYING PAN IS FOR $1 ON BLACK FRIDAY, **** THEY'RE GONNA STOP USING STOVES!!!!" It's called Amazon Gold box sale. P.S. Modern Warfare 3 went for $39.99 here in Canada at Futureshop (Owned by Best Buy USA). OH GOD THAT MEANS MW3 MUST BE FAILING. gosh darn you guys are silly as ****. As someone who works in the marketing industry, it's just called price skimming tactics. They will always sell the game at a high price (i.e. Digital collectors edition!) cause they know early adopters will buy it at WHATEVER price. But they know a large bulk of people are very price sensitive and will snatch it if the price drops. In regards to this, Amazon is using SWTOR as a "Hot sell item" tool to ATTRACT buyers to purchase in the FIRST place. While you're picking up your gold box SWTOR copy, you might buy X,Y,Z. Edited February 28, 2012 by lowflyingmeat Link to comment Share on other sites More sharing options...
goulet Posted February 28, 2012 Share Posted February 28, 2012 queue internet economy wizards to tell everyone the game will close in a week. call me crazy, and im not in to internet voodoo economics, but you make more money getting someone to subscribe to game then you do from just selling it. Side note: how many other games that have been out for 2 months do you still have to pay full price for? Better yet what mmo have you played in recent history that hasn't employed the same practice. Link to comment Share on other sites More sharing options...
Vincynt Posted February 28, 2012 Share Posted February 28, 2012 (edited) Crazy thread... Edited February 28, 2012 by Vincynt Link to comment Share on other sites More sharing options...
Ancientwolfgr Posted February 28, 2012 Share Posted February 28, 2012 http://www.amazon.com/gp/goldbox I didn't expect it to drop this fast...even if for 24 hours. I paid that much from the start in January... I don't see the issue other than people don't know where to shop or are impatient. Link to comment Share on other sites More sharing options...
lowflyingmeat Posted February 28, 2012 Share Posted February 28, 2012 I'll start by saying for three years I was a Sales Manager for Future Shop for one of the most successful stores in the country. I could state the accolades we won and the status we achieved as a store but it would just be internet bragging. Suffice it to say I do know what I'm speaking to in this regard. One day sales aren't always tied to off season product. In fact generally you'd put that bathing suit on sale in August or September to clear your stock to make room in your inventory for the winter stock that is incomming. I wouldn't put it on sale in January because in January people from the north (I'm from Canada so I would strategize to that climate) are going south for vacations in Mexico and want swimwear. There isn't a lot to be had as most retailer have cleared said inventory so you can charge a higher premium and in most cases people pay it even if the swimsuit isn't what they really wanted because the selection is poor. I can, I would put a sale on a well selling item because I want to boost my sales. And for some crazy reason people buy more when there is a sale, even if it's only $25 off of a $1000 item the illusion of savings is huge in the retail market place. I would also put a sale on a primary item that had margin in it, so room to reduce the MSRP and still make a profit dollar, because I wanted my sales people presenting and selling the complete solution. Regularly I would put a sale on a hot selling laptop that had little margin in it and sell it for cost either counting on my sales people to then upsell the add-on's. Extended service plan, which was 67% profit at a 33% cost for us, a mouse, an extra battery, case, etc. which had MORE margin in it. If I put a sale on a lap top saving the customer $100 and just breaking even but in turn was able to sell $400 worth of add-on that had a net cost to us of $50 I was winning. In the case of video games it's a little bit of a different story because it was pretty hard to sell a video game and add on a computer or console (though I did have people that could do that on my staff, it was rare, but it did happen). Video games were about clearing store inventory to creat more room because another game was launching soon and I just needed floor space. Also I would have a recently launched title at $59.99 and sell 8 units in a day or I could discount it by $10, sell it at $49.99, spread the word over Facebook and other social media sites and sell 50 copies that same day. Again that example is from a successful social media sale that we held at my location. In the case of "clearance" or hard to sell items it's usually a basement fire sale. I can attest to the FS / Best Buy modle where you pay to hold clearance inventory, and that's not unique to them, it's a pretty standard practice. If you have an item that is no longer carried by your retailer you generally pay a % of the cost of said item every 30 days it's held in your inventory. This effects your operating profit as it is deducted directly off that bottom line and thusly effects the bonsus payout for management. So say an item had a cost of $50 and was retailed for $100 (50% margin is not a crazy numebr at big box retail locations), if it goes clearance and after 30 days I pay $25 to keep it in my inventory, and it stays another 30 days and I pay another $25 I've now paid $50 to keep said clearance item. Do the math, eventually I'd sell it for $5 to avoid losing more money out of my bonus pool. The long and short of it is, yes, there are very good reasons you would sell a hot selling item at a reduced price. And in the case of a game with a reaccuring subscription I could see EA having reasons to want to boost sales of the product, expecially if they've recouped initial publishing costs (not necessarily developement) and now every $ they get for selling the box is just going towards infastructure or perhaps developement costs. But with the development budget of anywhere between $200 and $300 million and they've sold over 2 million boxes at a minimum of $59.99 they've already recouped development costs. So again any boxes sold at this point are gravy, it's going to profit dividends and infastructure. It's very likely that EA slashed it's costs to Amazon and every box Amazon sells today at $39.99 will see them get a credit from EA of $20, if we assume a $5 margin(so EA sold those origional boxes to Amazon for $54.99 for an MSRP of $59.99, software margin is not very profitable but Amazon did probably get a better deal considering the levels of inventory they would have purchased, but for arguments sake lets use those figures) Amazon is still making their $5 weather they sold it at $59.99 or $39.99 and EA is seeing more units shipped to customers who are potentially going to pay $15 a month in a reaccuring fee... I think you might see the picture now? This guy speaks the truth. Considering Amazon is one of the biggest retailers in America, they have the leverage and strings to pull with EA to acquire these copies at a different price. Even if that's not the case, they can afford a few hundred to go at a loss if they can draw in flocks. You know how much free PR they get when gaming sites scream out "OMG AMAZON IS SELLING SWTOR FOR 40$$$$ <FOAM AT MOUTH>" ? Alot. But then while you're checking out, you decide to buy that $100 Monster cable HDMI or some ****, Amazon just made an easy $95 from that sale to offset the SWTOR sale. Link to comment Share on other sites More sharing options...
XOrionX Posted February 28, 2012 Share Posted February 28, 2012 LOL, fanboys think of anything these days! To the rest of us, it's all about supply and demand. Game like Skyrim is STILL selling for 60 bucks, why? http://www.google.com/products/catalog?q=skyrim&hl=en&prmd=imvnsa&bav=on.2,or.r_gc.r_pw.r_qf.,cf.osb&biw=1137&bih=604&wrapid=tlif133044914312310&um=1&ie=UTF-8&tbm=shop&cid=14823466137015525662&sa=X&ei=-wpNT5bTDZTqtgfVurVS&ved=0CG0QgggwAQ#scoring=p|start=10 http://www.gamespot.com/the-elder-scrolls-v-skyrim/forum/skyrim-on-sale-at-toysrus-for-3999-61389439/ Wrong. You can find that game on sale at a variety of Online retailers. Don't be so dense. Link to comment Share on other sites More sharing options...
lowflyingmeat Posted February 28, 2012 Share Posted February 28, 2012 http://www.google.com/products/catalog?q=skyrim&hl=en&prmd=imvnsa&bav=on.2,or.r_gc.r_pw.r_qf.,cf.osb&biw=1137&bih=604&wrapid=tlif133044914312310&um=1&ie=UTF-8&tbm=shop&cid=14823466137015525662&sa=X&ei=-wpNT5bTDZTqtgfVurVS&ved=0CG0QgggwAQ#scoring=p|start=10 http://www.gamespot.com/the-elder-scrolls-v-skyrim/forum/skyrim-on-sale-at-toysrus-for-3999-61389439/ Wrong. You can find that game on sale at a variety of Online retailers. Don't be so dense. People take economics 101 and they think they can replace Ben Bernake. Wait. Really bad example. They think they can replace the pricing/marketing staff at Amazon. Link to comment Share on other sites More sharing options...
Suavecita Posted February 28, 2012 Share Posted February 28, 2012 This guy speaks the truth. Considering Amazon is one of the biggest retailers in America, they have the leverage and strings to pull with EA to acquire these copies at a different price. Even if that's not the case, they can afford a few hundred to go at a loss if they can draw in flocks. You know how much free PR they get when gaming sites scream out "OMG AMAZON IS SELLING SWTOR FOR 40$$$$ <FOAM AT MOUTH>" ? Alot. But then while you're checking out, you decide to buy that $100 Monster cable HDMI or some ****, Amazon just made an easy $95 from that sale to offset the SWTOR sale. Somebody deleted the post you are quoting, ***!!!!! Link to comment Share on other sites More sharing options...
Jxspyder Posted February 28, 2012 Share Posted February 28, 2012 LOL, fanboys think of anything these days! To the rest of us, it's all about supply and demand. Game like Skyrim is STILL selling for 60 bucks, why? Cause the game is still selling at a good clip, no one skilled in economics is gonna drop the price when the game is still selling at a reasonable amount monthly. TOR is dropping quick. Next month you may find it in the 5 dollar bargain bin at Walmart. EA Origin Digital Store. $59.99 Target. $59.99 Best Buy. $59.99 Toys R Us $59.99 Oh, and since you brought it up.....Walmart. $59.99 Clearly, the sky is falling. Link to comment Share on other sites More sharing options...
Andryah Posted February 28, 2012 Share Posted February 28, 2012 Okay, let me get this straight Mr. Economics... My product is selling really well for $50.00, so, I decide to put it on sale for $40.00? How does that make any sense at all? Why would I sell something for less than what people are willing to pay? Um... sales are usually associated with clearing stock, trying to move items that aren't selling at regular prices. Have you ever worked retail? any job? 1) Amazon does gold box promotions on a wide range of hot selling items. It's part of their attraction model. 2) You know when a sale on a product is indicative of an actual problem with the product in the market place?? WHEN IT GOES ON CLOSEOUT SALE. Link to comment Share on other sites More sharing options...
Vitellius Posted February 28, 2012 Share Posted February 28, 2012 What does it matter? According to some great thinkers, ToR is scheduled to be F2P any day now anyway. Link to comment Share on other sites More sharing options...
Jxspyder Posted February 28, 2012 Share Posted February 28, 2012 Look, I have no interest in this sale, or what it might mean, or fanboys vs haters. I just needed to point out that you guys arguing with Meldwyn are being nonsensical. The poster he was responding to was saying that items which are selling well can afford to go on sale, and thus are put on sale, and then said that we need to learn economics. Now, consider this: if an item sells poorly, you lower the price to drive up sales. Makes sense. however, if we listen to TheOnlyKyrenS, if an item sells well, you lower the price. Taking both together, no matter whether an item is selling well, or selling poorly, you lower the price. This makes no sense! If you want to increase sales, lowering the price can be a good idea, but TheOnlyKyrenS suggests that an item selling well means that you should lower the price. Following his reasoning, the price would quickly go to selling at cost, since lower prices would increase sales, which would mean it's time to lower prices again. If you notice, he backtracks (wisely) in a later post. Nothing against him, we all have thinking errors sometimes, but let's not compound it by arguing for a nonsense position. edit: http://www.giantitp.com/comics/oots0135.html If you want to increase sales of a standard item, sure. Much like many other items, the initial "boxed" item isn't the primary source of income. Razors have been brought up, as have copiers. MMO's are another. Especially when the sale in question, has nothing to do with EA/Bioware, but rather by Amazon in a rather common sales tactic that Amazon partakes in....hourly. Claiming that this single sale means anything to Bioware/EA/TOR...is kind of dumb, given the evidence. Link to comment Share on other sites More sharing options...
Vincynt Posted February 28, 2012 Share Posted February 28, 2012 Somebody deleted the post you are quoting, ***!!!!! It was me! I was bored at work so responded then decided screw it, it's not worth even commenting on so I went back and edited it to say "Crazy thread..." instead... Link to comment Share on other sites More sharing options...
Sparklehorse Posted February 28, 2012 Share Posted February 28, 2012 (edited) LOL, fanboys think of anything these days! To the rest of us, it's all about supply and demand. Game like Skyrim is STILL selling for 60 bucks, why? Cause the game is still selling at a good clip, no one skilled in economics is gonna drop the price when the game is still selling at a reasonable amount monthly. TOR is dropping quick. Next month you may find it in the 5 dollar bargain bin at Walmart. I picked up Skyrim Saturday at my local Best Buy for 39.99. I bought 3 copies. I bought 3 because it was going right back up to 59.99 the next day. Just sayin'... Edited February 28, 2012 by Sparklehorse Link to comment Share on other sites More sharing options...
Dinadan Posted February 28, 2012 Share Posted February 28, 2012 (edited) If you aren't hitting your sales projections, then by all means, discount it to try and draw business in and boost sales (more sales, lower prices, still possible to hit sales goals). But if I am hitting my sales projections, then there is absolutely no reason to discount my product. Would be very silly to leave money on the table that consumers are willing to spend. But even if you're hitting projections, isn't it possible that a firm still do better by lowering prices? Lowering prices would increase the quantity demanded, thereby potentially generating more revenue than at the previous price point. Hard to say without knowing the price elasticity of demand with video games. Edited February 28, 2012 by Dinadan Link to comment Share on other sites More sharing options...
Caladax Posted February 28, 2012 Share Posted February 28, 2012 If you want to increase sales of a standard item, sure. Much like many other items, the initial "boxed" item isn't the primary source of income. Razors have been brought up, as have copiers. MMO's are another. Especially when the sale in question, has nothing to do with EA/Bioware, but rather by Amazon in a rather common sales tactic that Amazon partakes in....hourly. Claiming that this single sale means anything to Bioware/EA/TOR...is kind of dumb, given the evidence. None of this applies to the side discussion at hand (I say "side discussion", because I explicitly said in the preamble of my post that I have no interest in what this sale means in terms of the game): The argument was that a well selling item should have its price lowered, ceteris paribus, as a general economically sound idea, not as part of a larger marketing strategy, or in order to increase subscription income. This is the idea that Meldwyn and I were arguing against. I understand that it might be valuable to give the game away at a loss in order to make income from subscriptions, but if someone said "you should give property away at $0, learn economics people", I would argue against this as a general economic principle, which is what it was presented as. Link to comment Share on other sites More sharing options...
Caladax Posted February 28, 2012 Share Posted February 28, 2012 But even if you're hitting projects, isn't it possible that a firm still do better by lowering prices? Lowering prices would increase the quantity demanded, thereby potentially generating more revenue than at the previous price point. Sure, and if TheOnlyKyrenS had said, "I guess they think that the added sales at the lower price will bring in more profit than their current sales at their current price", we wouldn't be discussing it, but he said that an item selling well can afford to be sold at a lower price, which suggested that higher volumes mean you should lower prices, which is the opposite thing to do. Link to comment Share on other sites More sharing options...
Dinadan Posted February 28, 2012 Share Posted February 28, 2012 Sure, and if TheOnlyKyrenS had said, "I guess they think that the added sales at the lower price will bring in more profit than their current sales at their current price", we wouldn't be discussing it, but he said that an item selling well can afford to be sold at a lower price, which suggested that higher volumes mean you should lower prices, which is the opposite thing to do. Yeah I see the issue, it depends on the price elasticity of the product. Link to comment Share on other sites More sharing options...
Vecke Posted February 28, 2012 Share Posted February 28, 2012 (edited) True story. When Left 4 Dead 2 launched, I really wanted the game, but I wasn't willing to pay $60 for it, so I had decided to wait until the price came down. Several of my friends bought it and said I should get it because it was worth the 60 bucks, but I had resolved to wait. A week after it launched, a friend told me that Wal-Mart had a one-day sale on Left 4 Dead 2 for $39.99. That was the week after launch. I went to Wal-Mart and picked it up. While I was there, I also picked up a few other things I needed. The next day, it was $60 again. A sale price given by an online retailer giant is not an indication of a game's sales, positive or negative. Edited February 28, 2012 by Vecke Link to comment Share on other sites More sharing options...
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