Ha. You'd think this would be obvious.
If your game stinks, putting out a demo gives your potential customer a chance to find out how much it stinks, demolishing your carefully crafted hype.
Trailers won't do that because they show carefully selected snippets of gameplay and all the sexiest pre-rendered cutscenes. Hard to get a true impression of actual gameplay when they don't show you more than five seconds of it at a time.

"The worst part about these reviews is they are [subjective]--and their scores often depend on how drunk you got the media at a Street Fighter event." — Mona Hamilton, Capcom Senior VP of Marketing
*Image indefinitely borrowed from BrainBoxLtd without his consent.







