Tesco flamed for game price slashes |
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Reports coming in from the UK point out that one of the region's retail giants, Tesco, has caught the angry gaze of other members of the retail trade after allegedly launching a price slash campaign for most of its games in stock. Games were offered online for prices as low as GB£ 3.00 (US$ 6.05). Popular titles such as Electronic Arts' The Sims 2 for the PC were offered for amazingly low prices, along with a number of PS2 games offered at GB£ 6.00 (US$ 12.05), DS and PSP games offered for GB£ 10.00 (US$ 20.05), and Xbox 360 titles at GB£ 15.00 (US$ 30.05).
Don McCabe of Chips frowned at the wake Tesco created with its major price cut campaign, but dutifully explained Tesco decision to "devalue" games. According to him, Tesco's non-food sales is steadily dwindling to a halt, and the chain's allocations for non-food items have also been reflecting that.
"They've reduced the amount of space that they give to DVDs now because they've effectively screwed that market up, and they've stopped doing CD singles as well," said McCabe. However, he believes that the move can have a detrimental effect on the publishers. He later explained:
If you devalue a product enough it turns consumers off and they stop buying. There's a risk that they could do that with games. There's a limit to how much the publishers out there will devalue their product. I'm sure they could go even lower, but this might not be with publishers' blessings.
Mastertronic's Garry Williams also reflected the same sentiments, stating that the effect could also hurt Tesco as well. "You have to ask the parties concerned what the long term benefits are. If [Tesco] did fund this [from their basket spend] they will have some serious repercussions from their High Street accounts," Williams concluded.
There have been no official comments made on Tesco's behalf as of press time.
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Comments
So, let me get this straight...offering games at a lower price "devalues" games and makes people decide to stop buying them? And people are supposed to enjoy the games more if they have to pay higher prices for them? Well, there is a bit of backwards thinking. I and most people I know prefer to purchase games after they go down in price, and I pass up new titles for the ones in the bargain bin when possible.
It may or may not be as great a deal, but check out Gamestop's sale, too: http://www.gamestop.com/gs/gamedays/ You can get lots of $20 PS2 games for $10, etc...
Sounds like more greedy BS to me. "There is a limit to how much publishers will devalue their product." Yeah, like not-at-all...
I have done a quick comparison of other retailers in the UK, Tesco prices are not the lowest, Play.com generaly has lower prices on the 360 games!
its 1000 times better than crappy wal-mart
On principle I agree with you guys that things should be cheaper if the product allows for it, but what Tesco is doing is artificially lowering prices (selling below cost) to get people in the door so they'll buy other things in the store. Problem is, when people get used to buying $60 games for $30, they feel like they're getting ripped off if they pay full price. When Tesco stops its sale, people are much, much less likely to buy new games for a while. It's just how it goes. The "devalued" comment refers to a specific concept in economics. It does make sense in the grand scheme of things. Hell, I don't pay $60 for most of the games I buy, but that's because I shop around and buy pre-owned when its worth it to me. I wouldn't expect new games to come out for less than $60 at this point unless they were budget titles.
how can : £3 = .05 £6 = .05 £10 = $20.05 what is this spurious 5 cents doing here, just call it /12/20!
You seem to ignore the fact that if you're paying 60 e or $ for a game then you ARE being ripped off.It's just that the prices are the same more or less everywhere.
Yes, people will start thinking about the quality of a game if it cost 6$. Then they will stop buying at certain stores because they are selling the same game at 20$
err what are you on about? if i lived in america and the conversion rate was 6 pounds + 5 cents id move to the UK a be a millionaire :P
It would not devalue games for me! i would just have more money to buy more :)
Gestault has a point, people will want to get games at low prices but then when it's over people won't be used to paying double the amount and will feel as if they are getting ripped off (at other stores after this sale is over). This can be backed up easily cause Tesco in the UK is basically what a Wal Mart is in the US so this price cut will be noticed by lots of people. Then other stores to get sales back up will also have to lower their prices and will devalue the value of software because then the video game companies working in the UK will have to make cuts in jobs, ect. to lower the price of production which in longer term means less taxes to the government and unempoyment, ect. and in a longer term affect the UK economy. Of course I could be a bit wrong in a few things since I'm just a 16 year old Puertorican kid XD.
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