This is a pretty generic definition but it applies not only for games but for any product or service of any nature. Those who know Project Management will recognize this.
I think that the best definition of a flop is when the developers goals set to the product are not met. And by goals I mean not only the goals for the product itself but the product within the context of the organization.
Example: a game might have terrible sales and good reviews, but if the goal is not to have huge sales but to establish a new brand, it could be considered successful.
Another example, the PS3: As a console, so far it has fallen way below sales expectations and could be considered a flop on that basis. However, if Sony decided that it was worth to sacrifice the PS3 in order to push Blue Ray (the BR drive in the PS3 was one of the main reasons for delays and high costs), than the PS3 can be considered a success by Sony Corp since it fulfill is main goal, Blue Ray, instead of consoles leadership.
Success of failure depend on how you see it.
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