Friday, December 14, 2007

Will Wii Rainchecks Lower Prices Now?

Today Nintendo and Gamestop announced they would be selling rain checks on Wii Consoles on Dec. 20th and 21st. If you can't find a console now they will guarantee you get one in January. Will parents stop paying the high prices on eBay and Amazon for Wii systems now that they can guarantee delivery by January? Will this bring the prices down?

Prices on Wii consoles have already come down almost $100 from late November when they were selling for $590. But the prices haven't dropped since the rain check plan was announced. In fact prices on Wii consoles went up 2.1% yesterday (12/13/07) to $485.

I don't think this policy will change prices for Wii consoles very much and might not be very popular. I think most parents want to put something under the Christmas tree when they are giving presents. They don't want to put a piece of paper saying "You get a Wii in January sometime. Merry Christmas. From Santa".

I think Nintendo realizes that most people who buy for Christmas will find a substitute gift if they can't find a Wii this holiday season and might not try and buy another right away. They were looking for a gift, the gift has already been given so they don't need to buy a Wii anymore. Nintendo is just trying to stop this from happening by offering this rain check. A good business idea. But I don't think it will be that effective. People want the Wii for Christmas not a rain check and many people will be willing to pay extra online in order to have it.


Travis Hendricks said...

In regards to whether or not this will raise or lower the eBay prices on the system I don't know. The thing I do wonder though is if the systems must be purchased in full on December 20 or 21 do they count on the total sales for December eventhough the system itself wasn't transferred?

Maybe it's Nintendo's way of jacking up the total sales numbers even further. Or maybe they don't really care about sales numbers and are just trying to sell them without having any in stock.

What a failure this season was for Nintendo's prediction committee. It is great to have the "no one can find it" mystique but I guarantee you they could release 2x the stock and still keep the shelves empty.

JJ Hendricks said...

Good question about December vs January sales. I would guess January, at least for industry sales numbers, even if they are paid in full because they won't be picked up until then.

I'm sure Nintendo is pretty pissed about these lost sales. The forecasts were way off and they are losing millions of potential consoles sales because of it. Most of those they will probably never get again.

Hopefully they won't be so conservative in the future.

mndrix said...

This makes the original suggestion to sell you Wii all the more convincing. Many opposed to the idea didn't think they'd be able to get a reasonably priced Wii in January. Now you can sell your Wii without any risk of that: just buy a raincheck first.

This Christmas season could be a good one to analyze retrospectively against predicted sales forecasts on sites like The SimExchange. If the prediction markets were better than Nintendo at forecasting console sales, they could provide hints about making some money on consoles next year.

It would be interesting to revisit this article at the end of December after the raincheck policy has had some time to satisfy existing demand and have a more noticeable effect on prices.

JJ Hendricks said...

I wonder if Nintendo does use theSimExchange at all when coming up with forecasts? I think it might be a good variable to at least look at.

I will try to revisit this again at the end of the year to see how prices were effected.

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