Mimiran has a booth at the Professional Pricing Society Fall Conference in Orlando. We’re giving away a Nintendo Wii in a promotion, which means we’re arguably giving away the year’s biggest pricing mistake. (Of course, you could argue that this is a mistake that goes back to 2006.)
Early iPhone adopters might disagree, after Apple’s $200 price cut, and many people involved in selling things from homes to cars might have their own candidates, but hear me out. Wii sales have averaged over a million units per month since the console’s release almost a year ago. We had to hunt around for 3 weeks just to find one to bring to the conference. (Good thing someone tipped us off that they were still hard to find.) At Best Buy, people lined up on Sunday morning to get them. The manager came out, 15 minutes before opening time, handed tickets to the first 13 people in line, and told everyone else to go home– they only had 13 units.
Nintendo wanted to keep the console affordable (bravo to them) and well under the $299/300 price point. In a sure sign of pricing opportunity, some retailers only offered the Wii in a bundle with games or accessories, at total prices ranging from $350 to $450. Even these vendors couldn’t keep them in stock. Would it have been so bad to launch at $279 instead of $249? They could have easily allowed stores to promote a $249 holiday price if sales did not meet expectations? Even if they only kept 50% of the difference, that would have added over $195M to the bottom line.
On the plus side for us, the Wii is a big draw. Several conference attendees have mentioned “my kids think I’m at Disney World, but if I bring back a Wii, I will be forgiven for going without them.” One also declined to enter the drawing, saying “if I win and bring it back for my husband, I’m afraid I’ll never see him again.”
Perhaps I’ll write another post about using promotions to attract the most qualified prospects. 😉