| TheBigFatJ said: The holiday season is revered as so important in the retail world because of the level of demand during that period. If your product sees that level of demand year-round, how important is the holiday season? |
The problem with this argument is that the Wii doesn't see the same level of demand right now as it will during the holidays.
Customers have varying levels of devotion. Some are going to buy a Wii no matter what, others are going to buy one for their kid for Christmas. Their kid does not have the ability to buy a Wii right now. The parents do, but they aren't going to spoil him by buying him whatever he wants whenever he wants it. It's not just parents, either. People get gift cards and spend them on consoles and games. In short, demand during the Christmas season will be far higher.
If there aren't enough Wiis available at Christmas, some of the people who wanted to buy one at Christmas won't buy one after Christmas. The devoted customers who want one right now will still want one after Christmas. It is a better business decision to satisfy as much of the "demand spike" as possible, since that demand isn't going to stick around for the next 10 months.
Obviously it would be even better to have a massive production increase during the holiday season, but factories just don't work like that, and you can't just snap your fingers and order a "short" manufacturing run of 5 million extra units. The alternative is to stockpile.
