   Answer to xbox shortage problem
  Why didnt microsoft start selling the xbox 360 for about $1000 and come down in price as supply ramped up and demand went down? It would make them more money. So anyone know why this would be a bad idea?    
  Because everyone would have started hating on Microsoft for having such high prices?   ;  They put the $400 in stores just to get you there, knowing they'd sell out and since you are already there, you'll buy the $300 + accessories to equal what comes in the $00 package, but at a cost much higher than $400.  A genius marketing strategy.;  But surely the $300 models sold out just as fast. And since they go on eBay for way more, MS are missing a trick really.   ;Quote:Original post by d000hgBut surely the $300 models sold out just as fast. And since they go on eBay for way more, MS are missing a trick really.Missing the "give people a real reason to hate us" trick, which would likely cost them customers and money (not that they couldn't absorb the loss, but it would still be a loss), perhaps. I certainly would be inclined to buy fewer MS products (not that I buy many now but I do buy some of the more expensive ones {excluding the academic discount I currently take advantage of} that I will likely continue to buy after I leave college, and I'm likely to get an MSDN subscription once I'm employed full time) if they used such tactics to the degree mentioned in the OP.I'm not at all sure, but I also think there might be legal issues with the kind of strategy the OP mentions, though those might only apply for artificial shortages.   ;Quote:Original post by evolutionalBecause everyone would have started hating on Microsoft for having such high prices?To be fair, haven't most people started on that already?;Quote:Original post by ukdeveloperQuote:Original post by evolutionalBecause everyone would have started hating on Microsoft for having such high prices?To be fair, haven't most people started on that already?Yeah, they couldn't win whatever they did by the sounds of it.   ;  The short supply creates demand. People have to have it because they can't, not particularly because they really want it. It is the whole Tickle Me Elmo concept. All these people are annoyed that they can't get them, so when they finally do release a whole bunch right after Christmas, people are going to run out and buy one.   ;  The money isn't really in the hardware - it's in the software, services and possibly the accessories.From what I've been reading in the couple of trade-mags I keep getting sent is that the whole point of getting 360 out before PS3 was to create a solid customer base with no competition.If they had a 6 months lead on Sony but sold it at $1000 they wouldn't have much of a customer base to sell software and services to. If they sell it cheaper (they make a loss on each unit) then they will have a bigger customer base.Jack   ;  But the point is while only 1 in 100 people who want a 360 can actually find one, then upping the price so only 1/10 the number want one means they still sell them all. Then just as a big new batch come on sale, drop the price again...   