jarrod on 30 March 2010
| Lafiel said: @ jesus ) I always wondered what people mean by "flooding the canals". Is it really an active process? I mean, do the companies do it by reducing the price for large quantity orders, so that stores/chains fill up their stocks or can companies just ship out more than the store ordered? If it's the former, then I don't see a big difference to the item being actually in good retailer demand. There is no way a company can constantly "flood the canals", so shipped numbers never are "virtually useless" in sales discussions, as it will be a good representation of those in at least 2 of 4 quarterly figures and for lifetime sales, especially the further we are into a generation, as world wide inventories are limited. |
Companies can't survive doing it perpetually, but everyone has channel stuffed at one point or another, and almost always early in platform's cycle for competitive reasons. Nintendo did it with GameCube in 2002, to try and keep pace with Xbox. Sony did it with PSP for it's first year and a half on market to appear to keep pace with DS. 360 did in late 2006 to hit that 10 million figure before year's end. Every incident of channel stuffing usually follows with a period of extremely slowed shipments though, it's more a short term tactic.
