Best Buy’s new $200/yr membership locks PS5, hot holiday items behind membership
arstechnica.com
arstechnica.com
Car manufactures figured out this problem by having sky-high sticker prices, then offering massive discounts. This turned out to be a smart move during the pandemic, because they could increase prices by 20% on some models by just not offering discounts. Special edition cars still suffer from ADM, which pisses people off, but in general this is a good solution.
Every gaming console released in the past 20 years has had this initial price surge at launch. I really can't believe that Sony didn't just come out with an MSRP of ~$1300 at launch, and aggressively discount it as supplies grew. But I suppose they were worried about pissing consumers off, so they let scalpers take the heat off the brand, making the lost revenue is essentially a marketing/goodwill expense.
I honestly think that people would have been fine if the initial MSRP was basically market-rate. People really, really, really seem to hate scalpers.
Plus, the Switch never really competed with the XB or PS5. Kind of like with a PC, Switch ownership compliments XB or PS5 ownership pretty well. People buy the Switch for the Nintendo games, and maybe tolerate a shitty port of a game because they can play on the go. But most people seem happy to own both.
Much better for the company to engineer a situation where it looks like the product is flying off the shelves. That signals to on-the-fence customers that this product is especially worth having.
Going for recurring news segments is merely corporate vanity in this case. What your talking about is better suited to luxury clothing brands, or things that are fashionable for a minute, then everyone moves on to the next big thing.
Plus, the scalpers are really starting to piss people off. It was acceptable in the first month or so because people thought it would die down soon. But we are a year out from launch, and it's still happening. People are starting to look at alternatives to gaming consoles because, while they'd happily pay $1000+ for a console, they aren't going to buy from a scalper on principal.
They also had plenty of gaming laptops. In fact, the gaming laptops were basically all they had in stock.
That demonstrates that market adjustments work to keep inventory in stock. Some people are willing to wait all morning in line to snag a $700 RTX 3070, but balk at the idea of paying $1100 for a Zotac RTX 3070. Which allows Joe Consumer to walk right into a store and get what they want.
I predict Sony will just cut their supply to Best Buy. They want their consoles to be cheap for a reason.
Plus, the PS4 Pros still exist. If a kid looks at a price roadmap and sees they can't afford a PS5 until 2023, but can afford a PS4 Pro now, and sees that they can get free PS5 upgrades on all games they buy for the PS4 Pro, they might pull the trigger on that.
As it stands now, people were thoroughly uninterested in the PS4 Pro, until it became clear that they weren't getting a PS5 anytime soon, so then prices on those spiked as well.
Every other consumer electronic has a stratified product lineup, where the top of the line model has a crazy high price, which drops quickly. Sony is just behind the times in this respect.
Third party studios aren't going to develop for a console with high a development cost AND reduced ROI.The result of your proposal is stagnating hardware and low game sales. These days, developers could just build games for the Xbox and easily port it to Windows and vice versa. Two markets for the price of a Windows server farm.
Two, I don't care if they're starving children in Africa. They're leeches creating, extending, and profiteering off shortages.
And it's not just PS5/Xbox X - it's happening with OLED Switches, something which wasn't forecast to have shortages in the first place.
Think of the guys who spent tens of thousands of dollars on generators, rented a truck and drove down to New Orleans after katrina. They got locked up (and their generators impounded) because they were "price gouging". As if the tens of thousands of capital and the dangerous work of brining the generators to market wasn't worth the 5x markup. The generators weren't doing anyone any good sitting in Kansas.
Surely you're not greedy, right? You work for the good of everyone and you benefit in no way, right? It isn't the benevolence of the baker that puts bread on your table. It isn't the benevolence of the brewer that puts beer in your fridge. It isn't the benevolence of the butcher that puts the bacon in the oven. Prices are signals, and they work.
> They got locked up
Good. They were taking advantage of the poor and needy who are living without their homes and public utilities. They were taking advantage of a crisis to line their fucking pockets. If they really wanted those generators from Kansas to be useful, they could have moved them and charged their costs. There's no need to extravagantly line their pockets - to be greedy fuckers - to provide a useful service to a disaster area.
TL;DR: I think that the scalper's "my pocketbook first, no matter the cost to you" brand of morality to be morally bankrupt, and utterly deserving of society's scorn (and more).
Farmers are often very proud of the fact they're feeding people, and I'm sure the same is true of bakers.
Given how often people seem to donate crops and food, I doubt you'd much of support for charging the desperate high prices for food, even from the people who stand to benefit.
Calm down dude, it's just videogames. None of this matters.
Right, because scalping totally only ever happens with videogames, and never with generators, toilet paper, and water.
Scalpers on consumer goods are just providing a market correction; rather than having the goods go to the lucky few to find the product on store shelves the product goes to the highest bidder which in theory who deriving the most benefit. The alternative is the only way to get a GPU/Console would be to wait in line the longest which would make GPUs unavailable for people who need them for work, research, etc.
It's not like scalpers have a monopoly on the GPUs, they are competing with each other while incurring their own marginal costs so it is unlikely that the scalpers would be capable of raising the price above the 'real' market price.
The GPU market is the prefect example since all the evidence suggests that the GPU AIBs and distributors are inflating the prices far before scalpers buy the cards. You can tell this is the case because the only models widely available are the higher-tier SKUs of each card type.
You can argue that a market in which there are scalpers is ripe for corruption, collusion, etc. but those are separate issues.
Scalpers provide the service of price discovery. If there exist scalpers, it is because something was mispriced in the first place.
Most scalping happens on scarce luxury goods that are not necessary in any way shape or form for your survival, existence or even happiness.
No one owes you a 3090 GTX or a front-row concert ticket, but if you really want one, then you're going to pay a bit of extra money for the convenience of being able to get a very scarce good on short notice. Don't try to project your own morality on this transaction.
It was really difficult to understand the concept in my mind, and the myriad places it applies, but it has helped me understand a lot of stuff.
Also an interesting fact: When Adam Smith said "free markets" what he meant was "free of economic rent". That is maybe as radical an idea now in our era of health insurance and credit based finance as it was in Smith's day of the "place men" of Britain.
Scalpers essentially make it always possible for a customer to buy a product if they want it enough ($$$). Otherwise, it's more of a lottery system, if the product is not priced well enough.
Not that there isn't plenty of people with multiple accounts that possibly look decent in most metrics. (Myself included)
Or... you know, any membership-only retailer ? Is Sam's Club also a scalper now ?
This also gets rid of the actual scalpers fighting for stuff in your store which is arguably better for everyone
The similar Gamestop program allows people to buy multiple PS5s. The guy I bought mine from acquired several from the same account. From what I could tell, it actually helped scalpers since they got a 1 hour early window to buy them and it took like 45mins to sell out. You were limited to 1 bundle per transaction, but he could get through multiple transactions before they sold out.
Keep in mind that real buyers don’t have much of a chance on Best Buy because the queue often gets bypassed by scalpers. Also you will still get hit by queue if you have this expensive account
TLDR you posted at a non optimal time so your post didn’t count
As far as I can tell they first created the membership and then when they happened to get some (limited) PS5 stock made it a membership exclusive. I don't think it's super weird that you would give your members priority.
Things you want are getting harder and harder to get; while the hard-to-get stuff will exit via the backdoor onto the grey market
Well, for several reasons you may not have considered:
1) I need you to find me a listing for a "used" ps5 that isn't broken, double the retail price of a new system, or a flat out scam.
2) You seem to be laboring under the delusion that the only reason someone would upgrade to the ps5 is for the latest and greatest hardware or to simply have a Playstation console. Instead, you should consider that there exist people like myself who hope to upgrade because of games that are exclusive to the ps5.
Edit: HN formatting is the best