Earlier quoted context omitted.
Nintendo has had a history of unexplainable supply shortages for in-demand items. (case in point: Amiibo)
Also this year's Fire Emblem Limited Edition (really frustrating, the box is excellent – they are now sold for at least 2x the original price) and probably any 3DS special edition. But consumers with too much money are also helping this "economy" with their purchase decisions. That eBay NES Classic in the parent comment was just sold for $610, more than 10x the retail price, and there are many other offerings. Just t…
Amazon sells out of the NES Classic Edition in less than a minute
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Re: Amazon sells out of the NES Classic Edition in less than a minute
#32Clearly thousands, if not hundreds of thousands, of gamers were sitting on the product page hammering the F5 key and some random selection thereof got their wish. I highly doubt that. My guess is that third party resellers used bots to purchase them all. Why wouldn't tc come to the same conclusion? Edit. yep here's one on eBay for $500+: http://m.ebay.com/itm/New-Nintendo-NES-Classic-Edition-Conso...
$610 was the selling price.
Re: Amazon sells out of the NES Classic Edition in less than a minute
#33Earlier quoted context omitted.
I really don't see why Nintendo didn't produce a bit more on launch - I mean, they're not some kickstarter newbie - don't they have some skills in demand-forecasting?
When you hear about how the latest Nintendo is sold out everywhere, it makes you want one more. They have slow production on purpose. If you could walk into any store and get one, it wouldn't be nearly as big a deal.
Best case scenario, a week or two after launch, the vast majority of that capacity would be sitting idle after the initial rush is over and the purchase rate tapers off. Worst case scenario, the product isn't as popular as you anticipated and you've got a big ol' writedown to deal with. (Atari anyone? Blackberry tablet?)
Re: Amazon sells out of the NES Classic Edition in less than a minute
#34Earlier quoted context omitted.
> It's not hurting anyone, it's just a stupid retro console. It's hurting the people who are forced to pay $600 for a $60 item because they need one (e.g. a must-have gift for someone). It's hurting the people who wanted to buy one for $60 but cannot afford to buy one for $600. So yeah, it's hurting basically everybody who had any interest in buying the product.
This argument is ridiculous. Otherwise there would be no such thing as luxury goods.
Re: Amazon sells out of the NES Classic Edition in less than a minute
#35Earlier quoted context omitted.
I really don't see why Nintendo didn't produce a bit more on launch - I mean, they're not some kickstarter newbie - don't they have some skills in demand-forecasting?
When you hear about how the latest Nintendo is sold out everywhere, it makes you want one more. They have slow production on purpose. If you could walk into any store and get one, it wouldn't be nearly as big a deal.
Re: Amazon sells out of the NES Classic Edition in less than a minute
#36Earlier quoted context omitted.
How is this "morally bankrupt"? It's just smart. Every business on earth would do this in there sector if they had the chance. What's wrong with a smart and clever individual buying this to resell at 8x? It's not hurting anyone, it's just a stupid retro console. What's wrong with society? People are struggling and getting screwed over by governments and big business, they badly need income and here is a small opportu…
> It's not hurting anyone, it's just a stupid retro console. It's hurting the people who are forced to pay $600 for a $60 item because they need one (e.g. a must-have gift for someone). It's hurting the people who wanted to buy one for $60 but cannot afford to buy one for $600. So yeah, it's hurting basically everybody who had any interest in buying the product.
Imagine a world where all concert tickets, no matter where in the stadium they are, cost $60. Imagine that there is no such thing as arbitrage. Obviously, in such a world, the tickets for the best seats will sell out first, since they're the most valuable. But they won't necessarily be well-allocated; they might be sold to people who don't actually care much about where they sit.
Now, introduce arbitrage (i.e. scalpers.) Suddenly, the tickets for the good seats, that are worth more than $60, are able to have that information built into their price. Now people who value seeing the concert from the best seats at $120, won't lose out to people who only valued those same seats at $60, but happened to get there first.
The people who are willing to pay $120, of course, might just be twice as rich, and therefore have about the same utility calculus as the people willing to spend $60 (i.e. it doesn't matter which of the two get the ticket.) But assuming two people with the same income, the one who is willing to pay more should get the ticket. They're willing to trade more of their happiness for it, so it probably will make them more happy.
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In the case of something like concert tickets, the way to fix this is for the producer themselves to price things at the prices the market will bear, such that they serve the role for the market that scalpers would do otherwise. To soak up all the arbitrage-able value themselves.
But in cases that aren't like concert tickets—and consumer electronics certainly qualifies—the "right thing to do" is to just make more of the thing. Scalpers don't exist when a company is relying on unit economics of profit margins for their total profits, and will gladly up supply to meet demand (and will also attempt to predict initial demand, and bring initial supply online so as to meet that as well.)
Companies can choose not to do this, of course. Mainly, companies avoid doing this because their profits aren't built around unit economics. Neither Prada bags nor Magic: The Gathering "legendary" cards are produced to meet demand; they're instead produced to be fought over.
But if the company does build their profits on unit economics, then that leaves you with two options for why they're 'underproducing': either they have to, because they have a tight logistics pipeline and the product wouldn't be revenue-positive if they made that pipeline "wider" for the sake of higher initial production (as happens with each new iPhone); or they're just doing it to have some of the "cachet" of the collector's items rub off on them.
In both cases arbitrage will necessarily happen. In the first case, the company themselves are mostly blameless. In the second, it's entirely the company's "fault" that people are paying $600.
Either way, this arbitrage is still helping consumers—at the expense of the company. But when it's done for cachet, it's certainly a "hoist by their own petard" sort of situation: the company are throwing away money they could have made, and letting scalpers pick it up, all for the sake of signalling (advertising) that they're a classy company (which—if people don't already believe this, they're not likely to start just because of one event like this.)
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Mind you, Nintendo is probably in the former category, not the latter. The production run for the Classic NES is probably on a minimal pipeline, designed to not leave Nintendo with any units left over once the buying is done.
Re: Amazon sells out of the NES Classic Edition in less than a minute
#37Clearly thousands, if not hundreds of thousands, of gamers were sitting on the product page hammering the F5 key and some random selection thereof got their wish. I highly doubt that. My guess is that third party resellers used bots to purchase them all. Why wouldn't tc come to the same conclusion? Edit. yep here's one on eBay for $500+: http://m.ebay.com/itm/New-Nintendo-NES-Classic-Edition-Conso...
Re: Amazon sells out of the NES Classic Edition in less than a minute
#38Clearly thousands, if not hundreds of thousands, of gamers were sitting on the product page hammering the F5 key and some random selection thereof got their wish. I highly doubt that. My guess is that third party resellers used bots to purchase them all. Why wouldn't tc come to the same conclusion? Edit. yep here's one on eBay for $500+: http://m.ebay.com/itm/New-Nintendo-NES-Classic-Edition-Conso...
$610 was the selling price.
Re: Amazon sells out of the NES Classic Edition in less than a minute
#39Earlier quoted context omitted.
This argument is ridiculous. Otherwise there would be no such thing as luxury goods.
What does luxury goods have to do with anything? A luxury good isn't a regular good that's simply been marked up 10x.
Re: Amazon sells out of the NES Classic Edition in less than a minute
#40Earlier quoted context omitted.
How is this "morally bankrupt"? It's just smart. Every business on earth would do this in there sector if they had the chance. What's wrong with a smart and clever individual buying this to resell at 8x? It's not hurting anyone, it's just a stupid retro console. What's wrong with society? People are struggling and getting screwed over by governments and big business, they badly need income and here is a small opportu…
> It's not hurting anyone, it's just a stupid retro console. It's hurting the people who are forced to pay $600 for a $60 item because they need one (e.g. a must-have gift for someone). It's hurting the people who wanted to buy one for $60 but cannot afford to buy one for $600. So yeah, it's hurting basically everybody who had any interest in buying the product.
LOL at the privilege of this being a real problem for someone. If we were talking about price gouging on food, medicine, or housing then I might agree with you. But luxury gifts? Come on, man.
> It's hurting the people who wanted to buy one for $60 but cannot afford to buy one for $600.
LOL at the idea that they can't just wait for them to manufacture more of them. I mean, the games have been out for nearly 30 years now, right?