With the total explosion of news we've received, after endless rumors and speculation regarding the PS4k/Neo, and the thus far rumored Xbox 1.5(whatever other term you'd like to pair with it for a mid-generation refresh), there's been quite a lot of commentary thrown around the boards regarding larger assumed 'trends' about buying habits in the various threads, and the sheer ignorance regarding many of these perspectives have led me to want to put some perspectives on things from a direct retail focus.
First off, some history, before working in the gaming section, I handled Mobile, so I do have direct experience handling Tablet and Cell phone sales for several years, on that side. I will however, try to not go into endless comparisons to the Cell phone marketplace.
First off, anyone assuming that the release of a premium model of the PS4k and so on, will suddenly lead to the normal model PS4 or XB1 going away, should never, ever talk about business/products again, because that's not how this works. Releasing a premium/high end SKU is catering to a higher end market, usually a tech-savvy market, who is willing to pay more to get more, while also giving you more market flexibility with your core product, and even allowing for it to lower in price on that.
Also, as an aside, people complaining about Sony not offering a trade in program, I would be shocked if both our stores or Gamestop and the like were not offering special trade-up (instead of 'trade-in', ah, marketing), deals to encourage adoption for your existing hardware. Reason being, that they can then re-sell that existing hardware on their own terms, or make profit in other ways, as trade ins are extremely lucrative profit margins.
Gaming hardware represents generally no profit margins for retailers, they're sold at cost, so getting special trade in promos to encourage them being moved and getting more product that can then be sold as pure money in the pocket back on top of any other margin add ons through things like protection plans and the like are all ways to encourage cyclical buying process. This is good for retailers. It encourages you to keep coming back, not be a static customer.
My next comment, on "Mass Market will totally reject this! It's going to totally fail!" Who the hell are you talking to? The Mass market adopts products perceived as having value based on specific reasoning, and that is up to Sony to justify it. Thus far, they've done an incredible job of selling the value of the core PS4 model. This would represent a premium option, sharing the existing library with new possibilities, and it's on Sony to make people want it. It is not hitting the reset button on the generation midway through a generation, you're not seeing a split user-base. I know exactly how to tell a customer what the difference would be. Pay a bit more, get more out of it, but you have the exact same library, play the same games as your friends. There's nothing lost for the existing market.
And most of those customers won't even care that there's a premium model *on* the market! They will see that a more costly model came out and ask why people would bother to pay more, even if it gives slightly prettier graphics. It's not going to matter, because the primary justification for most customers in the market, is the core balance of price and the fact that the games are coming to both.
A few of my regular customers have already talked with me about the rumors, and then the news today, and the general feeling from those that are savvy enough to be perusing sites and know about stuff like this is interest to see where it goes. There's very likely not going to be any push to try and replace the main SKU with this model, but it will be presented as the more 'awesome' model, perhaps, again, Marketing.
I had originally planned to wait til we had a bit more in the mill regarding the other hardware providers, but with how this was getting out of hand, I wanted to put some perspective from what we see here, on a daily basis.
First off, some history, before working in the gaming section, I handled Mobile, so I do have direct experience handling Tablet and Cell phone sales for several years, on that side. I will however, try to not go into endless comparisons to the Cell phone marketplace.
First off, anyone assuming that the release of a premium model of the PS4k and so on, will suddenly lead to the normal model PS4 or XB1 going away, should never, ever talk about business/products again, because that's not how this works. Releasing a premium/high end SKU is catering to a higher end market, usually a tech-savvy market, who is willing to pay more to get more, while also giving you more market flexibility with your core product, and even allowing for it to lower in price on that.
Also, as an aside, people complaining about Sony not offering a trade in program, I would be shocked if both our stores or Gamestop and the like were not offering special trade-up (instead of 'trade-in', ah, marketing), deals to encourage adoption for your existing hardware. Reason being, that they can then re-sell that existing hardware on their own terms, or make profit in other ways, as trade ins are extremely lucrative profit margins.
Gaming hardware represents generally no profit margins for retailers, they're sold at cost, so getting special trade in promos to encourage them being moved and getting more product that can then be sold as pure money in the pocket back on top of any other margin add ons through things like protection plans and the like are all ways to encourage cyclical buying process. This is good for retailers. It encourages you to keep coming back, not be a static customer.
My next comment, on "Mass Market will totally reject this! It's going to totally fail!" Who the hell are you talking to? The Mass market adopts products perceived as having value based on specific reasoning, and that is up to Sony to justify it. Thus far, they've done an incredible job of selling the value of the core PS4 model. This would represent a premium option, sharing the existing library with new possibilities, and it's on Sony to make people want it. It is not hitting the reset button on the generation midway through a generation, you're not seeing a split user-base. I know exactly how to tell a customer what the difference would be. Pay a bit more, get more out of it, but you have the exact same library, play the same games as your friends. There's nothing lost for the existing market.
And most of those customers won't even care that there's a premium model *on* the market! They will see that a more costly model came out and ask why people would bother to pay more, even if it gives slightly prettier graphics. It's not going to matter, because the primary justification for most customers in the market, is the core balance of price and the fact that the games are coming to both.
A few of my regular customers have already talked with me about the rumors, and then the news today, and the general feeling from those that are savvy enough to be perusing sites and know about stuff like this is interest to see where it goes. There's very likely not going to be any push to try and replace the main SKU with this model, but it will be presented as the more 'awesome' model, perhaps, again, Marketing.
I had originally planned to wait til we had a bit more in the mill regarding the other hardware providers, but with how this was getting out of hand, I wanted to put some perspective from what we see here, on a daily basis.
