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Squilliam on 10 December 2010
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Blood_Tears said:
Squilliam said:

Even if they have good margin on the PS3 you still have to account for the NRE (non recoverable expenditure) from developing  and releasing the PSP2. At the launch of a new product the NRE makes up a significant proportion of the cost of each unit. Beyond this what do you figure the outright advertising, marking and co marketing expenditure for a new launched handheld is? Microsoft allocated $500M, how much will Sony have to spend between the PS3, Move, games and the PSP2 and it's games?

That's why Sony Marketing is so bad actually, they don't have the funds to properly advertise each of there products individually, so they will do what they always do. Which is throw in ads and tv commercials of collages with everything bundled into one, showing pics of a PS3 with a PSP(2) resting on it with the move controller laying at it's foot.

Then we'll get a 30 second commercial with 1 second glimpses of every game/genre and platform they have with a fast paced song playing, and probably a smile from KB at the end.   There's your Sony marketing year all done and ready again for 2012 after that. Now that's cost cutting at it's finest...

 They produce a high technology product but they let it down with software research and development which makes it harder for them to add value to their products and they therefore rely on price cuts to spur demand which leaves little margin for marketing. Both Nintendo and Microsoft have been better this generation at adding value to their products and releasing products which better suit the needs of their customers if you go by their relative sales rates increasing at times without price cuts. It isn't a problem of marketing, it is other problems causing them to lack marketing. It is a common issue for many consumer electronics companies however many of them are slowly rectifying these issues, including Sony. This is the reason why I believe any price cuts won't be particularly steep like a 33% cut, they will preserve their margins as best as they can which ought to allow them to not repeat the mistake of sacraficing the PSP in order to salvage the PS3.

 



Tease.