Week awash in high-def releases
PS3, Xbox 360 add-on launch, along with Wii
By Susanne Ault and George T. Chronis -- Video Business, 11/10/2006
NOV. 10 | With a slew of high-profile new hardware devices set to hit retail shelves next week, merchants are mounting promotional and merchandising campaigns for both the devices and compatible software.
The Xbox 360 HD DVD add-on arrives in stores next week.
The PlayStation 3 and the HD DVD add-on for the Xbox 360 both are expected to bow this week, as are Microsoft’s Zune portable media player and the Nintendo Wii game console.
Timed to coincide with the launches of the Blu-ray Disc-equipped PS3 and Xbox 360’s HD DVD component are some of the year’s biggest high-definition title releases, including the Nov. 14 bows of 20th Century Fox Home Entertainment’s X-Men: The Last Stand (BD) and Universal Studios Home Entertainment’s King Kong (HD).
PS3 units are the most anticipated and in the tightest supply, with only 400,000 PS3 systems expected to be available throughout the U.S. on Nov. 17.
That said, Circuit City is promoting that six of its locations—one each in Chicago; Los Angeles; New York City; Philadelphia; Richmond, Va.; and Washington D.C.—are guaranteed to have 100 PS3s in stock, and each will open early at midnight.
Best Buy has midnight PS3 events scheduled in 18 of its locations nationwide.
The retailer angered many consumers when it posted a fully operational PS3 pre-order page during the weekend of Nov. 4-5, only to take the page down and cancel all pre-orders via e-mail notification on Nov. 6.
“Thank you for your recent visit to BestBuy.com. Unfortunately, your pre-order for the PlayStation 3 gaming system will be cancelled … and you will not be charged,” read the site.
Every consumer with a cancelled pre-order received a digital $10 Best Buy coupon.
Best Buy spokesman Brian Lucas explained that it was a mistake for the retailer to post the pre-orders in the first place, because the chain tries to preserve supply for its hotly anticipated product for those choosing to wait in line, usually for many hours.
“We’re going to have minimum quantities at every store,” said Lucas, who didn’t specify further. “Exact quantities will vary per store, but if you’re first in line, you’ll get one. They’ve allocated a certain number for the midnight openings, and there’ll be another minimum quantity when we open again at 8 a.m. Friday.”
GameStop, which includes EB Games, controls around one-third of the U.S. videogame sales but has not scheduled any midnight PS3 promotions. The firm did put together a one-day pre-order program in October for the system on a store-by-store basis, yet the number of customers allowed to pre-order was intentionally kept extremely low.
On a financial conference call on Aug. 17, GameStop executive VP and chief financial officer David Carlson warned the retailer would treat the PS3 introduction “conservatively” until units actually showed up in its warehouses. A sampling of GameStop locations queried by VB in the Los Angeles market indicated that store personnel would not know exactly how many PS3 units they would receive until the week of Nov. 13, and likely would not get stock until the Nov. 16.
GameStop does have promotion plans for the Nintendo Wii launch on Nov. 19, however. GameStop and Toys ‘R’ Us are the gamemaker’s official launch partners. The Toys ‘R’ Us store in New York City’s Times Square and GameStop’s Universal City location in Los Angeles are hosting the official Wii midnight launch events.
Other retailers are not precluded from putting on their own Wii midnight promotions, but Nintendo is only publicly supporting the GameStop and Toys ‘R’ Us events. It is not known whether these official Wii launch partners will benefit from more substantial unit allocations, as none of the parties will discuss Wii allotments.
Customer service reps at a number of Southern California-area Wal-Mart and Target locations said they would have some amount of PS3 systems on hand Nov. 17, but quantities varied wildly. In Los Angeles, one Target expected 20 units and another Target predicted 200.
Online auction site eBay is positioning itself as the place to nab hard-to-find electronics.
As of Nov. 9, eBay was listing more than a dozen auctions for PS3 pre-order claims, ranging as high as $1,775. One Florida-based seller was hawking a Toys ‘R’ Us pre-order, which was going for $1,675 one hour before the auction was set to close.
“It’s pretty much the only place where you know you are going to get one,” eBay gadget director Cat Schwartz said. “Supply is so minimal, and demand is so high. You will have to pay the price for it. But people will go above and beyond.”
Even if they won’t have PS3s in large quantities, many of the smaller, regional retailers are still hoping to capitalize on the week’s shopping excitement.
Texas-based Hastings Entertainment unspooled Blu-ray and HD DVD titles into its entire 154-store chain in November to take advantage of PS3 and Xbox 360 HD DVD add-on buyers searching for content to fill their machines. Until now, Hastings carried high-definition software in about half of its stores.
“This isn’t because of [strong in-store] HD DVD and Blu-ray title sales,” Hastings promotions director Mason Goodfellow said. “It’s more toward the fact that PS3 is coming out, then the add-on, and it’s also Christmas.”
Tweeter management is dismayed at not having PS3s at launch. But the chain can offer the Xbox 360 HD DVD add-on as an alternative. Microsoft has not publicly given a street date, but most retailers expect it around the same time as PS3 on Nov. 17.
Software specialist Newbury Comics has bumped up its quantities of Blu-ray and HD DVD titles, even though it has no plans to carry the PS3 or Xbox 360 HD DVD drive. Two months ago, the chain also started selling new release videogames for the first time in several years.
“There will be a lot of people buying PS3 right away, and at the beginning, it will be a gold-rush type of thing” in terms of people looking for related content, Newbury buyer Ian Leshin said.
