I was partially right in my Wii blog post where I thought that Sony’s PlayStation 3 would face a price cut. I saw this at the BBC news. Sony introduced a price cut in US and adds more value for European buyers. In Europe gamers will get a “starter pack” at an unchanged price for the 60GB machine, with two games and two controllers included. Sony has said it would cut the US price of the 60GB PS3 by $100 making it cost $500. Sony also introduces a new 80GB version at the original price of $600. (Interestingly, in Finland PlayStation 3 – without the “starter pack” – costs 650-690 euros, which is $900-950 US dollars, over $400 more expensive than in the US).
In the BBC news article, there was some comments from customers who pondered the following issues (which are worth checking by anyone who wants to learn about price cuts and using different prices for different segments):
- What if you ordered PlayStation 3 two weeks ago, will you get $100 back?
- One guy said he won’t be interested in buying PlayStation 3 in the Europe since it costs half in the US
- Those two games are good addition – but will they be something everybody wants?
I think Sony did a right decision to think about the price cut and “starter pack” – but seems like they might have listened bit more of what some customers are saying. While offering two games and two controllers is a nice addition, the price of the machine might still be too high in the Europe.
Now Sony will have to face with the US people who have already purchased the console – will people who bought PS3 week before the price cut get their money back? The two games (and controllers) are a good idea from Sony, but we’ll see if they are enough to beat Wii or Xbox in the Europe. After all, games are the biggest reason why people by gaming consoles. If the two games aren’t something most players want… then Sony has a problem.
Anyone thinking of reducing the price of his game (or product) has to think about these 2 questions:
- How will your loyal customers – those who already purchased from you – feel about the price drop? How will you handle with them?
- Would it be possible to add more value (in Sony’s case they try offering 2 games and 2 controllers with the machine) instead of a price cut?
We’ll see how it goes for Sony – and learn from their business decisions also in the future.