3 ms·

I think they know exactly what they're doing. Selling out in minutes causes news stories, and here we are.

by dgemm 10y ago

simonh 10y ago
Suppose they contract with the manufacturer to set up 10 production lines to meet initial demand, what happens when demand drops in the New a Year and 'everyon' forgets these exist? They'll have to decommission most of the lines, which also has a cost. Also if they over-supply the initial surge of demand even a little, they could be stuck with months worth of tail end sales. Then what do they do? Decommission all the lines for that time? They'll have to pay for warehousing the product as well. There are a lot of factors to consider, it's not just a matter of magicing up however many units are needed at any given time.
- moyta 10y ago
  Have you looked at the teardown of what this product actually is? Its using a very cheap Allwinner chip inside a plastic case, a similar board can be had for $7[1]. I highly doubt Nintendo is producing much in house, they probably have PCB manufacturing and final assembly outsourced, there isn't much to this device[2] physically. [1] - https://liliputing.com/2016/11/orange-pi-zero-7-quad-core-dev-boardmini-pc.html https://liliputing.com/2016/11/orange-pi-zero-7-quad-core-de... [2] - http://www.cnx-software.com/2016/11/08/nintendo-nes-classic-is-powered-by-allwinner-r16-soc-likely-hackable/ http://www.cnx-software.com/2016/11/08/nintendo-nes-classic-...
onion2k 10y ago
Doing things for press coverage in order to get an increase in future sales is a great idea for a startup with limited marketing funds, but Nintendo aren't exactly in that position. The fact is Nintendo failed to supply a sufficient amount of their product, and that has created a demand in a secondary market. All of the profit generated in that secondary market would have gone to Nintendo if they'd managed their supply properly.
- oneeyedpigeon 10y ago
  > All of the profit generated in that secondary market would have gone to Nintendo if they'd managed their supply properly. Untrue. The secondary market is currently selling units at a huge markup. I don't think we have a great indication at the moment on how fast the secondary market is moving; it's possible that, whilst Nintendo might have undervalued demand, the resellers are overvaluing it. As others point out, this also helps drive demand to an extent - it's a phenomenon Apple appears to take advantage of from time to time.
  - tajen 10y ago
    A model against this would be to announce that the first million copies will be at a 50% markup. It would mean that Nintendo (or Apple or whatever consumer-land vendor) can capture the added value, while using moderate production lines, stretching the delivery over time and still get the press releases about "We got our hands over the product, here's what it looks like".
- B1FF_PSUVM 10y ago
  Some sort of "exponential decay" pricing by the manufacturer would probably be very much frowned upon. They lose nothing monetary.
- slim 10y ago
  Unless it's a campain aimed at destroying sales of it's competitors during Christmas season. Remember that announcement for a new console planned for March? That's a startup marketing thing too, right?
hh2222 10y ago
This customer exploitation pattern is so common there should be an acronym for it.

I think they know exactly what they're doing. Selling out in minutes causes news stories, and here we are.

by dgemm 10y ago

I think they know exactly what they're doing. Selling out in minutes causes news stories, and here we are.

Suppose they contract with the manufacturer to set up 10 production lines to meet initial demand, what happens when demand drops in the New a Year and 'everyon' forgets these exist? They'll have to decommission most of the lines, which also has a cost. Also if they over-supply the initial surge of demand even a little, they could be stuck with months worth of tail end sales. Then what do they do? Decommission all the lines for that time? They'll have to pay for warehousing the product as well. There are a lot of factors to consider, it's not just a matter of magicing up however many units are needed at any given time.

moyta 10y ago
Have you looked at the teardown of what this product actually is? Its using a very cheap Allwinner chip inside a plastic case, a similar board can be had for $7[1]. I highly doubt Nintendo is producing much in house, they probably have PCB manufacturing and final assembly outsourced, there isn't much to this device[2] physically. [1] - https://liliputing.com/2016/11/orange-pi-zero-7-quad-core-dev-boardmini-pc.html https://liliputing.com/2016/11/orange-pi-zero-7-quad-core-de... [2] - http://www.cnx-software.com/2016/11/08/nintendo-nes-classic-is-powered-by-allwinner-r16-soc-likely-hackable/ http://www.cnx-software.com/2016/11/08/nintendo-nes-classic-...

onion2k 10y ago

Doing things for press coverage in order to get an increase in future sales is a great idea for a startup with limited marketing funds, but Nintendo aren't exactly in that position. The fact is Nintendo failed to supply a sufficient amount of their product, and that has created a demand in a secondary market. All of the profit generated in that secondary market would have gone to Nintendo if they'd managed their supply properly.

oneeyedpigeon 10y ago
> All of the profit generated in that secondary market would have gone to Nintendo if they'd managed their supply properly. Untrue. The secondary market is currently selling units at a huge markup. I don't think we have a great indication at the moment on how fast the secondary market is moving; it's possible that, whilst Nintendo might have undervalued demand, the resellers are overvaluing it. As others point out, this also helps drive demand to an extent - it's a phenomenon Apple appears to take advantage of from time to time.
- tajen 10y ago
  A model against this would be to announce that the first million copies will be at a 50% markup. It would mean that Nintendo (or Apple or whatever consumer-land vendor) can capture the added value, while using moderate production lines, stretching the delivery over time and still get the press releases about "We got our hands over the product, here's what it looks like".
B1FF_PSUVM 10y ago
Some sort of "exponential decay" pricing by the manufacturer would probably be very much frowned upon. They lose nothing monetary.
slim 10y ago
Unless it's a campain aimed at destroying sales of it's competitors during Christmas season. Remember that announcement for a new console planned for March? That's a startup marketing thing too, right?

hh2222 10y ago

This customer exploitation pattern is so common there should be an acronym for it.