Why would Gamestop have a deal unless PS3's are sitting there

Gamestop has been notoriously lowering the value of trade-ins as they gobble up their competitors. So, why would they give you $100 towards a PS3 when you trade in an old PS2 unless the next-gen system is rotting on the shelves?

Gamestop doesn't make money on the PS3 (nor does any retailer). The only way Gamestop can make a profit is selling games and accessories. They can only do this if people own the system. So, Gamestop seems to need to encourage people to purchase the PS3. They would only do this if there were systems sitting on their shelves.

Another stake Gamestop has is that it caters to hardcore gamers. They have historically done poorly with Nintendo products, because for the last two generations, Nintendo has been shunned by many in the hardcore community. So, if Sony losses market-share, and Nintendo gains, that becomes a huge loss for Gamestop.

Any way you slice it, Gamestop offering a trade-in deal on a system that has been out for less than 2 months, means that the system is not selling as well as it should be. And with Sony not able to create the systems as fast as Microsoft and Nintendo, any stock rotting on shelves is a bad omen.

Sources

http://www.joystiq.com/2007/01/13/deal-or-no-deal-100-off-ps3-by-giving-up-ps2/    Votes: 1

Posted by Bill

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