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Forums - Sales - The usefullness of price cuts?

MoHasanie on 13 November 2014

It will sell well for the rest of the holidays but after that, sales will become bad again. I don't think it will ever outsell the PS4 worldwide though,



    

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ArchangelMadzz on 13 November 2014
kowenicki said:
ArchangelMadzz said:
kowenicki said:
Yeah. Price cuts dont work.

Deary me. Are you serious?


Long term? Microsoft has had crazy promotions pracically every month of the year. None of them has had a lasting effect, although this is definitely the best and most successful one they've done. But if they didn't outsell PS4 WW this week then it wont happen this year as the intial rush of the price drop would fade. Although there will be a natural christmas bump the PS4 gets that aswell.

So a price cut only works if you become number 1 globally in your product space?

This is silly thinking.

Price cuts increase sales, temporarily or long term . Therefore they work. The end.


Depends on what you mean by work. An effective price cut plugs a whole in a sinking boat. So far all of MS deals and cuts have pluggd a whole, only for it to be popped out again and water starts flowing to sink the boat. 

The goal of a price cut is to increase the movement of a product for an extended period of time. If the PS4 or X1 dropped to $200 that would cause a surge in sales, well.. forever. But a drop that causes a boost that fizzles works, it's just not great as they just take a loss at a small gain.



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Intrinsic on 13 November 2014

Whats this? Almost every single week this year the PS4 was outselling the XB1 as much as 2:1 worldwide per week. The week of the price cut the PS4 only managed to outsell the XB1 buy ~20k. Thats a very well working price cut right there.

Yes, the XB1 will drop again but it should have an overall higher baseline as long as it remains cheaper than the PS4. Another thing about price cuts or generally selling more consoles that no one talks about is that tack on effect. A console selling well tends to sell better cause people that have it will push their friends to get it too. Thats why the overall baseline increases.



kitler53 on 13 November 2014

tripled dude. tripled.



Sharpryno on 13 November 2014

Well next week is Halo week sales, expect another 400k+ consoles sold 



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Squeezol on 13 November 2014

It works, but the question is if it works enough.



Dr.Henry_Killinger on 13 November 2014

Why don't we actually define what the objective of a price cut is? Not to mention the goal of the price cut for the company is something we can only speculate on.



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soony_xbone_U on 13 November 2014
Robbie2010 said:

So the price cut of the X1 has failed to push it past PS4 ww according to VGC.  The X1 has seen two pricecuts.  The first $100 came with the removal of kinect but still failed to boost sales to compete against PS4.  (I call it price cut for the sake of argument since you could not buy a kinectless sku before).  Now with the $50 price cut of the X1 still failed to pass the PS4 ww even with a free game. 

Will the pricecut  keep the X1 competitive after this week or will it fizzle out like the previous pricecut?

Also, will MS cut the price further to $300 to keep it competitive within the next few months?


Yes price cuts fail to do anything. Companies should not do price cuts and be price competetive. If the pricecut does not keep u from failing, u should not do it.

Im being sarcastic, if someone wonders

 

Pricecuts are useful. The price of an product is one of the most important factors of its  success. At a longterm standpoint more than shortterm.



TheBlackNaruto on 13 November 2014

The price cut worked GREAT!!! It did what it was supposed to do, increase demand for the system which also increased the sales. So because it did not pass the PS4 WW it failed? This makes no sense but to each his/her own I guess.



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gabzjmm23 on 13 November 2014

it is a win-win situation for the consumers. you got the console you want on a cheaper price. for the company that dropped the price, did they already recuperate the money or are they still getting profits even with a price drop?
it is up to them if they want the public to know. some analysts would be able to know, which is needed in order to know if they can be competitive in the market enough or not, it would also be an indication if they can continue to push for next gen consoles and exclusives and what is the sweet spot on the price deals.