Is the Xbox One a failure?

[DonFerrari]

Zackasaurus-rex said:

DonFerrari said:
Companies care less about marketshare than About total sales and profit. Of course bigger presence and MS preffers total domination but no need to fret over it.

 

Console manufacturers make most of their revenue in game, service, and accessory sales. In other words, marketshare is directly tied to overall profitability. 

This is why emboldened companies even choose to be loss leaders and why MS have made such drastic price cuts and bundles in addition to increased advertising.

Nope. MS bleed to have better sales not necessairily marketshare. The end game is profit. If profit was directly link (not just a reflex of total sales and how much you could have sold if you had more participation and competitors less) they would sell the consoles even cheaper.

 

They will basically run simulations based on price curve, adoption curve, sales made and cost of sales looking for the sweet spot where most profit is expected. It is silly to put marketshare there since you can't control the market or other companies (you can estimate and try better share but not as usefull as profit.

 

My company is one of the top dogs in its market. Never saw a meeting talking about marketshare, but about market penetration, joint ventures, pursuits, new sales, etc there were a lot. Matter of fact our financial plans includes like improve sales from 8 to 8.5 billions, improve margin from 25 to 27%, several quality metrics and no mention at marketshare