Why Do "Blockbuster" Games Go On Sale?

TripleTags

TripleTags

CAG Veteran
Like many of you I saw Call of Duty 4 last weekend for a bargain 48 dollars at Target. But it got me wondering WHY? Why would this "Game of the Year" already be on sale when Halo 3 is still full price? Is it not selling well?

Can anyone educate me ;)?
 
The supply exceeds the demand by too much. It's another reason why Maddens are worthless even the same year they came out.
 
Yeah, it helps get people in the stores. If they come for a blockbuster game for a cheapass price, they may pick up an extra controler, or a bargain bin game, or some new pillow cases, or a six-pack of Heineken......
 
I got it for $37.99 at Best buy.

I think it has to do with when they came out and holidays factor in. And as far as Halo that is because Microsoft can do that.
 
[quote name='MrDubbs']and to think about it, you have to wonder how much these stores paid for that 1 game in comparison.[/quote]

I would estimate about $20...$30 if they have a bad purchasing contract.
 
[quote name='m0dem']Its also an attempt to get people into the store so they can buy other products.[/quote]

Exactly. Notice that it isn't dedicated gamestores like GameStop even running those kinds of sales (I know they run their own sales, but usually not to that degree, and not on brand new games).

It's places like Target and Best Buy, and the sales are the same reason they'll sell you a new release DVD for $16.

With the scale of business that Target and Best Buy do, they probably don't care too much about the profit from selling COD4 or Halo 3; they want you to come into the store and buy a new HDTV for $2000.
 
well i for one will buy a cheap game in the ads and i will always check clearance @ target. i know i am falling into there hands but i am not the only one
 
It was the holidays so they wanted to get you into their store so while you're there you might end up picking more stuff up as gifts and so forth. And I believe games make the most money in the first few weeks of release, they can afford to cut the price on those games and make it up by selling so many.

Either way, thank jebus as I really wanted COD4 but didn't want to pay full price. Hopefully I can get AC for $40.00 as well.
 
90-95% of the time, I don't fall for these 'sales', unless there's some way I can make it BETTER for myself. I prefer to wait till games hit clearance anymore to buy them.

Also, who the heck buys games for $48 and thinks it's a steal? 20% off the normal MSRP is a 'steal'? Ahhh well...to each their own...
 
[quote name='IAmTheCheapestGamer']90-95% of the time, I don't fall for these 'sales', unless there's some way I can make it BETTER for myself. I prefer to wait till games hit clearance anymore to buy them.

Also, who the heck buys games for $48 and thinks it's a steal? 20% off the normal MSRP is a 'steal'? Ahhh well...to each their own...[/QUOTE]

On a really new blockbuster game, yes. Especially if that game has an active multiplayer aspect. A game like BioShock I plan to wait until it is $20 before I get it. And we'll see if I still have interest at that point.
 
COD4 is a steal at $60.

Single player, multiplayer... it's all good.

Then again I got mine for free from a referral site.
 
[quote name='TripleTags']Like many of you I saw Call of Duty 4 last weekend for a bargain 48 dollars at Target. But it got me wondering WHY? Why would this "Game of the Year" already be on sale when Halo 3 is still full price? Is it not selling well?

Can anyone educate me ;)?[/quote]

and... why are new release dvd's cheaper the 1st week they are released?
 
[quote name='MrDubbs']and to think about it, you have to wonder how much these stores paid for that 1 game in comparison.[/QUOTE]

on the last CAG cast (the clip show) Cheapy replayed their interview with someone who used to own a game store and when State of Emergency came out it sold for 50 dollars.. he bought copies of the game at around 40 dollars each.. I imagine thats what the Wal-marts and best buys have to purchase their games at.. I imagine they make more money on the "bargin" games (as they are probably easier to restock easier to sell at that price) then they do the new releases..

games go on sale.. whether its closer to their release or the eventual TRU or CC clearence they all get cheap.. its just at what point do you buy games?.. usually i wait until the pawn shop has them.. but with 360/PS3 games they haven't quite made it here in town yet as a matter of fact I rarely see DS games there I have seen multiple PSP games there.. but I usually always purchase used games (its also how Gamestop makes its money on trade ins and resales) mostly because new games are a rip off (if the multiplayer is really good people will still be playing it...for a while to come )
 
[quote name='seen']I would estimate about $20...$30 if they have a bad purchasing contract.[/QUOTE]

Not a chance. The profit margin on new games is tiny (and even smaller on consoles). Why do you think Gamestop always bugs you to buy the card/warranties/used games?
 
[quote name='InvaderZim']and... why are new release dvd's cheaper the 1st week they are released?[/quote]

Same reason. There are dozens of different places that'll sell you the new Spider-Man or Pirates flick when it hits the shelves. That's a major draw to get people into the store so they all need to keep their price as low as possible to make sure people come to them and not their competitor.

There is the most interest in a title the first week it is out so that's the only time they can take advantage of the crowds.
 
[quote name='urzishra14']on the last CAG cast (the clip show) Cheapy replayed their interview with someone who used to own a game store and when State of Emergency came out it sold for 50 dollars.. he bought copies of the game at around 40 dollars each.. I imagine thats what the Wal-marts and best buys have to purchase their games at.. I imagine they make more money on the "bargin" games (as they are probably easier to restock easier to sell at that price) then they do the new releases..

games go on sale.. whether its closer to their release or the eventual TRU or CC clearence they all get cheap.. its just at what point do you buy games?.. usually i wait until the pawn shop has them.. but with 360/PS3 games they haven't quite made it here in town yet as a matter of fact I rarely see DS games there I have seen multiple PSP games there.. but I usually always purchase used games (its also how Gamestop makes its money on trade ins and resales) mostly because new games are a rip off (if the multiplayer is really good people will still be playing it...for a while to come )[/quote]

That's a bit different though, we're talking about a guy who owns a small store probably, and bought maybe 15 copies, or so. I don' t know. But it wasn't on as large of a scale as a Wal-Mart, K-Mart, Target etc would buy them.

Since they probably buy them all at once, then send them to stores from DC, and the stores don't order direct from the game manufactorers, I have to imagine that they get a pretty hefty discount.

I honestly can't see them buying games at 40 dollars, then selling them for 37-39 "on sale" I mean, these games probably cost the manufactorer, less then 5 bucks each to make if that
 
[quote name='MrDubbs']That's a bit different though, we're talking about a guy who owns a small store probably, and bought maybe 15 copies, or so. I don' t know. But it wasn't on as large of a scale as a Wal-Mart, K-Mart, Target etc would buy them.

Since they probably buy them all at once, then send them to stores from DC, and the stores don't order direct from the game manufactorers, I have to imagine that they get a pretty hefty discount.

I honestly can't see them buying games at 40 dollars, then selling them for 37-39 "on sale" I mean, these games probably cost the manufactorer, less then 5 bucks each to make if that[/QUOTE]

no it really is all the same.. they have to go through the same kinds of distribution channels as everyone else.. they may get a SLIGHTLY better deal. but not really its not like they are buying the games at 10 bucks and selling them for 60 no way.. they are probably buying them at around 40 and selling them for 60.. maybe a little less.. but not much..
 
[quote name='MrDubbs']That's a bit different though, we're talking about a guy who owns a small store probably, and bought maybe 15 copies, or so. I don' t know. But it wasn't on as large of a scale as a Wal-Mart, K-Mart, Target etc would buy them.

Since they probably buy them all at once, then send them to stores from DC, and the stores don't order direct from the game manufactorers, I have to imagine that they get a pretty hefty discount.

I honestly can't see them buying games at 40 dollars, then selling them for 37-39 "on sale" I mean, these games probably cost the manufactorer, less then 5 bucks each to make if that[/quote]

Ok so the games are cheap to produce but then who covers the development cost?
 
I honestly think a lot of the $37-$39 prices were to counter the TRU B3G1. Halo3 was wholesale $47 at a bunch of different retailers that don't specialize in videogames.
 
[quote name='Green Card200']Ok so the games are cheap to produce but then who covers the development cost?[/quote]
All I'm saying is the cost that the stores get there games at is far less then you'd expect...

as is with any other product, they get more discounts then you'd imagine
 
Everyone wants it, so retailers discount it in order to attract more customers to their stores in hopes of selling them other crap while they are there. So, it's not that the demand isn't high, so they cut the price, as with a crappy game, rather, the demand is high so retailers use it as a tool for increase foot traffic (and ideally, overall sales).
 
My last store's margin on games was 10%. If we were fulfilling a special order and only ordering one item, then we might not even get free shipping... we didn't really make money on games.
 
[quote name='MrDubbs']All I'm saying is the cost that the stores get there games at is far less then you'd expect...

as is with any other product, they get more discounts then you'd imagine[/quote] You're overestimating, even the big retailers make around 15% on each game sold (if that).
 
There's alot of factors that play into the mix for pricing....co-op advertising funds not being the least of them...Some of it may be initiated by the retailer as loss leader to get folks into stores....some may be initiated by publishers to push games at certain times of the year...some may be a combination of the two......maybe a publisher has another game that they want to push and if retailer X orders a certain amount of Game Z then they might get a break on their next order of Game Y....Maybe Game Z tanks and a publisher looks to dump a stagnant game by linking a promo to a popular game (such as the that amazon promo of buy bioshock get the darkness for free a few weeks back). I seriously doubt that any major retailer is getting AAA titles for less than $40-45 on a regular basis, although sales promo payments/marketing slush funds may get kicked in to help keep the public focused on some specific games. The fact that the back of this week's best buy circular has six games at $20 off is not some random chance....Those publishers paid money to be there and are probably kicking back $10-15 in additional co-op ad funds/other promo payments back to BB for each one sold.

In the case of CoD4, the audience that was definitely interested in it bought it up when it came out and fiddling with the price a bit 6 weeks later is sound marketing to widen up its appeal without trashing profitability too much...after all it sold very well and very fast when it came out, so the publisher has probably covered most fixed costs of development, so every additional item sold is serious fat money for them, even if sold a $15 or so discount.
 
[quote name='ZForce915']On a really new blockbuster game, yes. Especially if that game has an active multiplayer aspect. A game like BioShock I plan to wait until it is $20 before I get it. And we'll see if I still have interest at that point.[/quote]

I don't care if a game has a multiplayer aspect to it, though it is a bonus if it does. Although, with the bulk of development being for next gen(or current gen if you've already switched over)systems anymore, I find myself with limited options for new games to play anymore.

So lately, I've been diving back into my backlog and checking out which used games I wanted to try back when they were new on the scene and getting them for a steal of a price compared with the $50-60 of current stuff and the $50 or so they started out at last gen.

There is something to be said for not being impatient and wanting the latest and greatest right this second, that being that all of the glitches, exploits and various other game aspects have been determined and usually the price is MUCH lower and you can get 2-3 games for the price you'd have spent on that ONE 'blockbuster' title that may turn out to be a total waste of time and money.

I just wish that Microsoft and all of its third party partners in turn had not abandoned the original Xbox for development, since I feel there was alot that still could've been done on it. But, I guess some manufacturers think the old cut and run is better than hemmorhaging money and keeping the fan/userbase strong and supported. I don't blame them though, since I'd do the same if I were still losing money on every system sold.

Either way, it'll be a long while till I have to worry about the pricing for current stuff, but I intend on enjoying every last gen title I never got a chance to play and wanted to at a cheaper price than many paid.

I still don't see the appeal of rushing out to get the newest 'blockbuster', when some of them turn out to be overhyped garbage, but I guess just like the astronauts going into space, someone has to be the pioneer and put their money on the line to determine if the new games live up to the hype.
 
Sometimes the sales are in part initiated by the game company. They'll fund the sale w/ a retailer for a weeklong "rebate" of sorts, whereby each barcode scanned will result in a credit to the selling store. Most likely against future orders.

Slightly different type of products, but for a few weeks Sony was offering a free 800 dollar Home theatre w/ television purchase. The store was getting rebated the price of the discount as long as we scanned the barcode. And the credits were taken off of future orders that the company placed with them.
 
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