The lights are on
Nintendo has recently started selling refurbished DSi XL and 3DS units on its website. This might seem like an insignificant change, but the pricing scheme in place disrupts a cardinal rule of direct to consumer sales.
In the days before the Internet, there were hard and fast understandings between manufacturers and retailers. Chief among them was, "do not undercut retailers." Mail order was no substitute for shelf space, because it was the primary way to get products in front of consumers. It was acceptable to sell directly to consumers, but the prices had to remain equal or higher in order to preserve relationships.
Things have changed. Manufacturers are able to communicate directly with customers, and many have their own online stores. People have become more accustomed to waiting a few days for goods, and immediacy is no longer a key selling feature. Still, the old arrangements are in place. It's rare to see retailers pushed around on pricing by direct competition from the supplier.
As of writing, Nintendo is charging $99.99 for a standalone refurbished DSi XL costs and $129.99 for a refurbished 3DS (each with a one year warranty). Best Buy, who also sells used units is currently priced at $10 less on both fronts. GameStop (Disclosure: Game Informer is owned by GameStop) is currently asking $109.99 for used DSi units and $159.99 for used 3DS consoles (with similar refurbishing).
Whether Nintendo is purposely trying to disrupt its relationship with GameStop is unclear. However, it would not be the first time the manufacturer was at odds with a retailer. Kotaku has previously followed the strange tale of Nintendo's relationship with Amazon, which has deteriorated to the point where the online retailer does not sell Wii U and other hardware. Burning a bridge with other retailers when sales are down is counterproductive to Nintendo's recovery.
Retail is still important for getting in front of the more casual consumer. Sony stated earlier this year that it still anticipates relying on brick and mortar. Whether Microsoft will lean as heavily on traditional retail, or lock out used games, is unknown but we expect to have more information on May 21 when the next Xbox is revealed.
[Source: Nintendo via Joystiq]
how much back lash is it gonna take to get through to you?
As much as I love GameStop, if I were to buy a console used, I would want it from the manufacturer especially if they're giving a 1-year warranty on the item. Plus, more hardware sales equals more software sales which is good for everyone in the industry including the customers.
I understand... it's somewhat scary to consider the possibilities of brick & mortar disappearing. I'm sad that I have to drive miles and miles to find a hobby store since they can't compete with the prices online. The beauty of brick & mortar is developing a relationship with the people that work there (actual human interaction) and to actually physically see the item that you're buying (yes... you can call me old-fashioned).
But on this front, I have to say that it's great that the manufacturers are getting in on the used console market, especially if they can certify them. Just as we believe that video games should mimic other business practices such as used game sales, so too should manufacturers be able to sell their products certified used.
Additional competition means only positive benefits for the consumer. And maybe if the publishers can better understand the used console community, then they could chill out on the used games side as well. I see this as a win-win situation with only places like GameStop seeing the negative in this (lower the price!... this is capitalism at its best).
Good, may be a chance to finally get a 3DS.
Oh my gosh! A company selling it's own product, blasphemy I say!
This is a pretty pathetic article. No mention of the fact that GameStop gouges players with their practices, and that we complain LOUDLY about it (as mentioned by other, real business and technology journalists on the internet).
It's borderline criminal that GS charges ten bucks less than MSRP for a busted up, barely working 3DS. Even worse that they don't offer any kind of discount for used games that have no case or instructions. How is that any kind of value to me? Nintendo wants to give me some value by undercutting GS? GS wants to retaliate? I'll go get my stuff at Target or Wal-Mart. I'm sure they wouldn't mind setting up a used games section.
And don't give me this, "B-b-b-b-but our relationship with GS does not affect my reporting." What a load of horse hockey.
Please tell me how Nintendo could not undercut the price when Gamestop only sells a used 3DS for 10 bucks less then a new one? Thats almost criminal. I never shop at Gamestop, and this is exactly why. Their business practices are unethical and as someone that works in Supply Chain I refuse to buy from companies like that. This article irritates me.
Well the last time I bought a "refurbished" Dsi from GameStop, half of the touchscreen didn't work. Yes it was me NOT to buy the warranty but still, I had paid $80 for it and if I were to return it now I would only get $20 maximum.
Honestly, Game Stop over prices their used 3DS units. I would rather buy one from best buy or nintendo then spend as much money at gamestop. Dont get me wrong Game Stop is my favorite store....
Don't exactly need/want another 3DS, but pink? Hm, maybe there are more female fans out there than I realize that'll love this move. . .
Suck it Gamestop
www.amazon.com/.../ref=nb_sb_noss
???
Get it together, Nintendo.