PSP Not A Sellout Hit

MilenCent writes "We're starting to see our first mainstream media reports on the PSP's (lack of) sales performance, from the Seattle Times: "But while Sony is touting the rollout as a success -- and many retailers did sell their entire stock -- the event might not have been the complete blockbuster that was expected." In summary, the article says that more systems were sold than not, that dedicated gaming stores were more likely to sell out than department stores like Target, and that the biggest reason gamers didn't pick it up is likely its price -- which wasn't helped by some retailers' sale condition that customers also purchase games, which could raise the price to nearly $350. Will demand pick up once the unit is out there and seen by people, or will it take a price cut before the system sells satisfactorily?"

Comments

Yes, I wanted a PSP

[rocjoe71]

Sure I wanted a PSP, but there was so much hype about the waiting lists and how hard it was going to be to get one leading up to March 24th that I didn't bother looking because I figured I wasn't going to get one if I did.

On the bright side, lower than expected sales usually leads to price cuts so I'm glad the big hype machine failed.

bad ideas for launch

[Tumbleweed]

In order of biggest problem to least, IMO:

1) LCD quality control & dead pixel policy. Horrid.

2) Only selling the 'value' pack. Worst. Idea. EVER. There is already a great selection of third-party add-ons which make the 'value' pack absurd.

3) High price of games. $40-50 per game. Ouch.

4) No demo units in stores. You want to sell a $250 machine? Have demo units.

5) Some stores selling only bundles. Out of the 5 stores I went to opening day, only 1 was doing that in the Seattle area (KB Toys).

6) High price of UMD movies (when they arrive). Silly; they shouldn't try selling UMD movies to the public; this should really be targeted at rental places, especially airport locations.

All these problems aside, most of this can get better, if not much better. Quality control will increase over time, and they're already addressing the dead pixel policy. Hopefully they'll come out with the base edition, sans 'value' soon. $50 in third-party add-ons goes a long way.

The biggest hope I have is that they'll either change their business model, or make a PSP-like PDA platform with a modular bay where the UMD drive is. I live in breathless anticipation.

Re:Not surprising...

[justforaday]

I was in my local Target last Friday afternoon and overheard two of the clerks talking. Out of the 100 they received, they had sold 3.

Re:Games

[tepp]

I'm a PS fan, but these are not the games I'd buy.

I'm a female gamer, and I prefer games with stories, games with plots and twists. I loath straight out racing games and "sports" games. I don't like fighter games either - too much boring button mashing. I like games that make me think, games that rely on figuring out solutions rather than memorizing "super combos" or memorizing a track.

Plus, the price of the system is a bit high for merely a portable system!

That being said, I would've bought it had it only had Katamari Damacy on it! The ability to roll stuff up while on the bus, or at work.... mmmm. Rolling.

Other PS games I would've paid for - and bought it for - any Final Fantasy game, including FF strategies and other older ones... any Silent Hill game... any Grand Theft Auto, or Prince of Persia (1 or 2).

Problem of perception

[igrp]

You raise some very interesting points.

3) High price of games. $40-50 per game. Ouch.
Personally, I think that is going to be Sony's biggest problem down the road.

If you think about, $40-50 isn't really that much money for a game you'll get countless hours of enjoyment out of. Well, at least if you're a working adult, it isn't. That's especially true if you compare it to a night out a the movies or a decent meal for two. Both of those will cost you around, or upwards of $50. That is not how it works in the real world though.

Few people think rationally about a product's price tag. And people perceive $50 to be a lot of money (and rightfully so). Dropping fifty bucks on an item you need is okay, wasting fifty bucks on an item you know you or somebody else will enjoy (say a Christmas present or - to stay on topic - even a video game that allows you and your buddies to kick back, watch a football game and play before and after) - sure. Selling the idea of spending $50 on an item you're only using to amuse yourself for a short period of time is a whole lot harder because it doesn't quite feel right.

If games were, say, $30 a piece, it would feel more like picking up a CD on your way home after work. Something most people wouldn't feel guilty about at all - after all, you're rewarding yourself and it's "just $15". And whilst $30 is certainly more than most people would pay for a CD, it doesn't feel wrong for a portable video game because most average middle-class Americans still perceive $30 is "inexpensive", whereas $50 is still an investment of sorts (think about it: don't think twice before you hand someone a $50 bill whereas handing someone a $10 just feels natural).

Add financial constraints to the mix ("gotta pay the bills"), and $50 just doesn't like your getting your money's worth. Sure, a lot of hardcore gamers won't mind plucking down $50 for a game. But that's not necessarily Sony's target audience -- if they want to be profitable, they need to target a broader demographic. And a $50 a pop, people will think twice about buying your product. These days, very few people make $50 impulse buy decisions...

Re:Problem of perception

[petsounds]

If you think about, $40-50 isn't really that much money for a game you'll get countless hours of enjoyment out of.

Well that's exactly where the problem lies. You see, in general the publishers and game studios aren't being *honest* with customers about the quality of their respective titles. If they were, there would be much more granularity in the pricing structure of games. But as it is, they market every game as if it's a AAA title (even though internally they know very well which ones suck and which are mediocre), and so they have a fixed price point for every game. This leads to a situation where consumers have to wade through endless amounts of marketing BS to find the truth about a game. If they were willing to sell a mediocre console game at $25, people would be much more willing to buy it. But they aren't willing to be honest. ESPN was honest with their sports games. And then EA bought them out to shut them up.

To speak more to your point though, I believe publishers vastly underestimate how complicated consumers are in their game purchase decisions. I think for a lot of us, the "worth" of a game is determined by a mix of longevity, fun factor, and style. If this is some action game that we can blow through in 8 hours, do not expect us to throw down $50 for it. I have to give Namco props here for releasing Katamari Damarcy for $20. I think this exactly proves my point. If you nail the price point correctly, people will buy it in droves, whereas it might otherwise languish on the shelves and in three years be talked about by game journalists as a cult classic that got overlooked.

I think in the end a flexible pricing structure would serve to benefit both the publishers and the consumers. Lying to your customer base by saying every game is amazing and worth $50 only serves to piss people off, and after so much marketing shrill (and don't think I'm not also pointing the finger at you for this, IGN et al), people start to just tune you out completely. I think that is exactly what is happening with the PSP. Sony got greedy and thought people would buy a portable system as if it was a third Playstation console. But Nintendo has already set a different price expectation for consumers, and that will be very difficult to overcome.

So to borrow a note from Jon Stewart: publishers, stop hurting the game industry. Just stop. We know that next-gen games cost more to produce, but charging more money isn't necessarily the answer.