Hacker News Reader

Comment by jamornh | Hacker News Reader

I don't think you can seriously believe that the Razer Blade being sold for $250 is "cost price."

But I'm sure they did a full calculation of the costs that they'd have to eat if they honor this mistake and thought it was worth it for the good PR it would create.

View on HN

90% pretty certainly means they were selling them at a loss, but I would agree that it's probably not as huge a loss as a 90% discount would suggest. In the "enthusiast" branch of the market, I would guess that a margin of at least 50% should be pretty standard. A $250 mouse very certainly costs far less than $250 to produce, although you always have to factor in their other business cost - advertisement and design to establish an "enthusiast" branch might even exceed what they pay on manufacturing. (This is also why you see them do so many sponsorships - it's simply a very, very cheap way to get exposure.)

I would think that it's not impossible that this was planned.

1234 as a coupon code is even something that people might find by mistake, meaning you wouldn't even have to try hard to seed the rumor. Just put it into the system and know that somewhere in the future, you will get a huge PR without much effort (other than stopping it after a certain period of time and accepting some losses).

In the industry a hell of a lot of people think it was a marketing trick, not a mistake. I'm leaning that way too, based on my knowledge of people within Razer (though I should point out that while I know plenty of people there, I don't have any specific knowledge about this situation, just speculation).

To pull this off purposefully wouldn't even have to be too expensive, we have no way of knowing whether they are honouring thousands of orders or a couple of hundred. And regarding margins, a hell of a lot of the costs associated with a typical product sale come from distribution (the distributor takes a cut, the retailer/etailer takes a cut, plus MDF marketing costs), so this deal being through the Razer site will certainly help keep the losses down.

Also side note to jamornh: the Blade isn't available in the UK yet, so bad example - but your point still stands, 90% is definitely a loss.

Ah, I did not realize that the Blade is not yet available in the UK. Thanks for the correction.

If this was planned by Razer as a marketing trick then it is quite elaborate, although completely possible. There seems to be several hundred people on the comments who mentioned they made purchases and some would even cancel their order.

In order for this to be staged they would have to limit the number of times that the code could be used (allowable "loss" budget? max number of uses?) and then pretend to realize the mistake and take the site down at the right time (maybe when the "loss" reached a certain amount.) I guess it isn't completely inconceivable... but if that's the case, well-played Razer.

I'm not sure it's really that complex, in their statement they've announced they will honour one purchase per person, not bulk buys, and it's quite easy to limit how many people make purchases either by manually watching it, or even with a little bit of code to kill it after X sales. Regardless, I either respect Razer for their pro-customer decision, or for their marketing idea, either way.

(And I don't think the Blade will ever be available outside North America. It's an irrelevant product that they created as a marketing gimmick.)

Jamornh wasn't referring to a $250 mouse. He's referring to this $2,500 gaming laptop at 90% off: http://www.razerzone.com/gaming-systems/razer-blade

Selling those for $250 is obviously a massive loss on just the hardware alone.

Wow, I really didn't know that they also made laptops! Thanks!

Don't feel too bad. I had no idea either until I did a search for "razer blade" after reading his comment.

Only very recently. So it's understandable that you wouldn't know.

I'm almost certain that the UK store was the only store affected, and the UK store doesn't have the Blade for sale. On the stuff they sell, I imagine that 90% off isn't that far away from their costs.

Reply on news.ycombinator.com