I mean… even if they’re not moving a lot of units, its still broadly a good problem to have -> considerably more people than you thought, want to buy the thing you sell.
So at bare minimum you’ve over delivered in terms of product design.
The extremely obvious capitalist response to that would be to raise prices on that thing. Win win, right? The extra profits go toward more capex to make more future production.
… But they haven’t done that.
They haven’t done that because they care about their image more than their profit margins on this particular product.
And/or because in the current environment… basically, the cost/reward on spending more capex isn’t worth the reputation hit.
The capex spending to meaningfully ramp up production would be so expensive, that it’d end up being a net loss, in terms of reputation damage.
Do you have any evidence to suggest that valve released a brand new controller and decided, what out of the goodness of their hearts, to sell it for a loss?
Businesses sell things for a loss all the time, it’s never out of the goodness of their hearts. It’s a strategy to gain market share or to sell other products for a higher margin. Every supermarket you’ve ever been to has products for sale at a loss. Doesn’t make it a good deal for the customer either, just an accounting reality.
Yes but valve already has a monopoly on the PC gaming market. Usually companies sell things at a loss to attract you to them so you buy other things while you get the good deal.
In valve’s case, we’re already in the store buying their games. There’s no reason for them to sell it at a loss, because it won’t attract people to steam.
Theres nobody out there saying “wow I would be a PC gamer playing on steam if I had a steam specific controller.”
Maybe that’s the case for the steam machines and steam frame coming up, but I kinda doubt it.
Yeah but this isn’t really the same as the Costco hot dog. It’s a product that’s more expensive than the alternatives (though they don’t have track pads) and steam is the defacto pc gaming software. Other massive companies can barely compete and have to do stuff like epic where they give games out for free (exactly the kind of tactic you’re talking about). My sarcastic comment about the kindness of their heart is because I personally can’t see another reason to do that. That’s why I asked for any evidence - an interview, a tweet from someone who would know, an article, anything other than a hunch.
As someone who works in retail, even our best sales at our store will still make us around a 10% profit. Our normal GP for items sits around 30% to 40%, so while it is less than that we almost never actually sell things for a real loss.
Why should they take a loss on the controller? There is no RAM or other parts affected by the price hikes in it. Also they announced the price only shortly before launch. Why should they have chosen a price that does not cover the costs?
This does not make any sense.
Well, on the one hand… having more demand than you can actually fulfill is the kind of problem most busineses would like to have…
Assuming they’re actually moving a lot of units.
I mean… even if they’re not moving a lot of units, its still broadly a good problem to have -> considerably more people than you thought, want to buy the thing you sell.
So at bare minimum you’ve over delivered in terms of product design.
The extremely obvious capitalist response to that would be to raise prices on that thing. Win win, right? The extra profits go toward more capex to make more future production.
… But they haven’t done that.
They haven’t done that because they care about their image more than their profit margins on this particular product.
And/or because in the current environment… basically, the cost/reward on spending more capex isn’t worth the reputation hit.
The capex spending to meaningfully ramp up production would be so expensive, that it’d end up being a net loss, in terms of reputation damage.
… At least this is my semi-informed guess.
They are not. Sold out in 30 minutes. Lol.
You can sell out a loot of units in 30 minutes…
Bold of you to assume that you can’t sell out hundreds of thousands, if not millions of units in 30 minutes.
This man has never heard of bots
And bots don’t have to pay for goods or what are you trying to say?
Well the bots got the lion’s share, for sure. They’ll get the machines and frames too.
Or they are taking a loss on every deck, controller, sold and we don’t even have a price on the desktop.
Valve is taking a red bloody bath and slowing the bleeding.
Do you have any evidence to suggest that valve released a brand new controller and decided, what out of the goodness of their hearts, to sell it for a loss?
Businesses sell things for a loss all the time, it’s never out of the goodness of their hearts. It’s a strategy to gain market share or to sell other products for a higher margin. Every supermarket you’ve ever been to has products for sale at a loss. Doesn’t make it a good deal for the customer either, just an accounting reality.
So… no evidence?
Yes but valve already has a monopoly on the PC gaming market. Usually companies sell things at a loss to attract you to them so you buy other things while you get the good deal.
In valve’s case, we’re already in the store buying their games. There’s no reason for them to sell it at a loss, because it won’t attract people to steam.
Theres nobody out there saying “wow I would be a PC gamer playing on steam if I had a steam specific controller.”
Maybe that’s the case for the steam machines and steam frame coming up, but I kinda doubt it.
Yeah but this isn’t really the same as the Costco hot dog. It’s a product that’s more expensive than the alternatives (though they don’t have track pads) and steam is the defacto pc gaming software. Other massive companies can barely compete and have to do stuff like epic where they give games out for free (exactly the kind of tactic you’re talking about). My sarcastic comment about the kindness of their heart is because I personally can’t see another reason to do that. That’s why I asked for any evidence - an interview, a tweet from someone who would know, an article, anything other than a hunch.
Exactly you can’t personally see it so i explained it to you lol
As someone who works in retail, even our best sales at our store will still make us around a 10% profit. Our normal GP for items sits around 30% to 40%, so while it is less than that we almost never actually sell things for a real loss.
They could’ve sold it at twice the price I’d still would’ve bought one tho?
Why should they take a loss on the controller? There is no RAM or other parts affected by the price hikes in it. Also they announced the price only shortly before launch. Why should they have chosen a price that does not cover the costs? This does not make any sense.