Why the 360 pricecuts will never work.

[Tigawoods]

Pharaoh said:

Tigawoods said:

Pharaoh said:
Everyone seems to forget them 360 was out a whole year before the PS3, the first year that it was out it sold 5.2 million units compared with 0 PS3s. So in fact they aren't in 3rd place because their are in different times in their lifespans.

The continued price cuts, (whether fire sales or discontinued SKUs), by the 360 will leave them with an "inferior" market perception about their product. Yes people will buy it at the beginning of its price cut, but after that you are left with a market perspective of inferiority.

You can not compete on price alone, which Microsoft should have realized already. The Wii has an overlapping target market that does not compete on price, (it hasn't had a price cut). So you can't use the Wii's success as plan to sell more 360, you think Microsoft executives would know this.

 

 With that logic we shouldn't shop at Wal-mart because the boxed pizza is better at (insert non budget grocery store name) since it's more expensive.

It isn't "logic" its marketing, it's what you learn in college.  People will buy "inferior"(not saying the 360 is inferior people, just saying it is getting that way with the price point) products, they always will, but the perception will be that it is worth less than the other products on the market.  Wouldn't you rather eat a Papa John's or Pizza Hut pizza for 10 bucks, or pay 7 bucks for a Wal-mart pizza at their deli?  You buy a pizza at Wal-mart because of convenience not taste, but with evey bite you regret not ordering Papa John's.

 

Well of course it's going to worth less thats the whole point. Smart shoppers don't and shouldn't think buying the cheaper brand means they are buying something inferior. Maybe the product and company is managed better and has less costs to make up for. Maybe it uses its own plants or facilities to produce said product internally rather than buy products/ingredients/whatever from other manufacturers. Theres a lot that goes into setting the price than just the product itself and what it's worth.

The 360 is now using a different set of components that are cheaper to make and mass produce so why wouldnt you cut the price? Cutting the price doesnt reflect it to being inferior in terms of value compared to other products. It just shows that the product can be mass produced by a more efficient means. Regardless of your views as to why the pricecut is happening the fact of the matter is MS has cut the costs to make the 360 to a degree and it is now showing in the price cut. Plus lets face they need some sales.

Don't even think of lecturing me or anyone about college as you have not even graduated from one yet.