Microsoft asking retailers to pull Kinect pre-orders

Some retailers are now being told not to accept any more pre-orders for Kinect due to a worldwide product shortage.

Are Microsoft creating a stock shortage or is Kinect really that popular world wide?

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pedrami912742d ago (Edited 2742d ago )

Those monocle wearing ************* !

Mr_Bun2742d ago

MS should have spent some of that 500 million on producing product

visualb2742d ago

If MS spend 500 million on ads alone, and targets 3 mil on launch...isn't that underselling?

as in...will Kinect even break even?

+ Move has almost reached 2.5 mil world wide in 30 days not counting japan, which probably means 3.5 mil by the time its released world wide in a space of 2 months +/- 2 weeks, yet didn't spend half that amount on advertisements (probably)

I dno, just seems to me 3 mil sold vs 500 mil dollars spent is a bit...strange
then again I'm not an accountant so I wouldn't know, i'm sure they know what they're doing (better than me anyway xD)

Sheikh Yerbouti2742d ago

500 million in advertising is for the whole year not just launch. They want to sell more than $500 million for launch - 3 million worth of product.

callahan092742d ago

You're absolutely right, visualb. It's a bit odd. I mean, 3 million sold at 150 dollars each is 450 million dollars. That means that in pure sales generation the thing won't even hit 500 million dollars if they sell 3 million. That 150 dollars from each sale doesn't all go to Microsoft, either. There's the take that the store gets, there's the distribution costs, there's the production costs, etc. to take into consideration. So they're not even getting that full 150 for each sale. So you're absolutely right. They aren't going to be profiting on it, they'll be taking a loss on it.

But, do we know how long the time frame is on that 500 million dollar advertising campaign? Is it just for the same period that they're going to plan on selling 3 million? If so then, uh oh. But even still there's consolation for them. Spending that kind of money on a big ad campaign and selling 3 million in a month or two may generate a loss, but it will also generate public knowledge of the device and spread word of mouth, and while I know that current internet knowledge & word of mouth on the device from gaming nerds like us is not very positive, the word of mouth may be more positive from the soccer moms and children and end up playing with the device early in its life and that could mean the word of mouth in the public out there is good, and that can drive sales going forward. So that 500 million dollars probably also sets them up to get some free viral word of mouth man on the street type of marketing.

Man_of_the_year2742d ago

Ok I don't know why you guys are thinking that MS needs to sell "X" amount of Kinects on Launch to break even. The advertising is set to create product awareness. Kinect will be around for years and this is just 1 moment in product advertising and marketing. This $500 million spent now can last several years.

Re-runs on Oprah and Ellen.
Word of mouth.
Product awareness.
Additional add on sales.

Also note that going by your rationals that MS "NEEDS" to sell "X" amount of Kinect on launch to compensate for the $500 million advertising budget (since for some reason you seem to think that as soon as Kinect launches suddenly the advertising for Kinect is removed and people will magically forget what they saw and heard) then MS needs to hit 3,333,333 Kinects sold. If MS sells 3 million on launch then that just leaves 333,333 units left to break even....Now remember we are not considering any additional software or hardware for that purchase...such as a new 360 in order for Kinect to that will be ready on launch....ect.

There is no doubt that MS is going to hit the break even point come launch or at most 6 months after launch. Anyone who doesn't think they will are just fooling themselves or are just angry fanboys upset that MS is creating another successful product that people will buy and devote more time into supporting MS than Sony or Nintendo.

silvacrest2742d ago

you guys also have to consider manufacturing costs, R&D costs, and although MS are selling kinect for $150 they aren't getting all of that when they sell it and if callahan09 is righ,t 3 million sales wont even be close to breaking even

MicroSony4Life2742d ago

the materials that the product is made of not being available or maybe have went up on price due to the ever changing market - are you guys forgetting that the PS3 had a shortage when the slim was released because of that same issue.

Also at people saying that MS will need to sell X amount of kinect to break even, your forgetting that the money spent on advertisement is not for one day but can be used for the entire year of 2011.

Also consider that MS is expecting Kinect to move some consoles during xmas, which mean more money.

Lord_Doggington2742d ago

kinect is a loss leader. ms will make the money back selling software

Enigma_20992742d ago

... came here to ask about THIS, leaves satisfied.

Anon19742742d ago

When retailers started posting early "sold out" messages with regards to pre-orders for Kinect I thought it was far too early and the move was simply retailers trying not to get ahead of themselves without knowing how many Kinect consoles they would be receiving when they ship. Now we have confirmation that Microsoft is flat out telling retailers to yank the listing rather then putting the horse before the cart. If you don't know how many you can sell, you really shouldn't be selling them.

Shortages of Kinect will be brutal come this holiday season. If it's not available, do you really think buyers are going to sit and go without over the holidays, or do you think it's more likely they'd switch to Move on the PS3 or a Wii?

+ Show (6) more repliesLast reply 2742d ago
avengers19782742d ago

It's funny the people at my local gamestop have said people have shown little to no interest in it... and they barely have any pre-orders. I'll admit this was before the Oprah show had made mention of kinect.

bustamove2742d ago

Wait a minute...why are they pulling preorders if they're so confident this would sell? They spent so much money on advertising and now they're not even confident with their product?

...What's going on?

gamingdroid2742d ago

If you did not, chances are you won't even read this comment.

With that said, they are pulling pre-orders because demand is exceeding supply prior to release. It has nothing to do with the quality of the product!

bustamove2742d ago (Edited 2742d ago )

I read the article. What amazes me is that Microsoft is creating all this hype and you people are falling for it.

And that's not what the article said.

"Of course we don’t know if this means that Microsoft isn’t releasing enough stock into the retail channels or if the demand is just simply greater than the supply which is exactly what every new product wants to happen."

Now go ahead and slam disagrees like you guys always do when heaven forbid someone criticizes Kinect.

gamingdroid2742d ago (Edited 2742d ago )

MS hyping their product makes perfect sense, since they are trying to sell you a product? I have yet to see a company not WANT to create hype for their product. If they do, I doubt they will exist for too long.

Falling for it is such a ridiculous term. Did you fall for it when you purchased your PS3? Everybody places value on a product differently, and if you are in the US, you have 30-days to return the product in most cases if it isn't up to snuff.

With that said, it is no difference than you going around hating on MS/Kinect except MS is making money and you likely got no stake in it other than perhaps your pride and feelings!

HDgamer2742d ago ShowReplies(6)
Thecraft19892742d ago

I don't even know anyone buying and the game my bro works at has not sold a single one.

Rainstorm812742d ago

funny thing is I only know one person interested in buying Kinect.... So either its in very limited supply (PS3 launch limited) or this is the hype train rolling along.

In a few weeks we'll know the truth

Myst2742d ago

When I went into pre-order Fable 3 I encountered one guy who was curious about Kinect. Now whether or not he was serious is another matter. It certainly seemed like he was ready for it to land, but I just don't know if he was being sarcastic with the clerks.

Every time I've been in that is the only time I have ever encountered anyone talking about Kinect.

TOO PAWNED2742d ago

casuals are buying it folks, people that are not like we. I would be surprised if it was otherwise to be honest. I guess thats what MS wanted

gaden_malak2742d ago

Can't see casuals spending $300.

PimpDaddy2742d ago

Casuals were spending $249.00 USD on a Wii when it first launched. Not to mention if you got a second Wiimote you pretty much just spent the same amount of money as a 360/Kinect Bundle.

Motion2742d ago (Edited 2742d ago )

Is Microsoft even marketing that a 360 is required for this? From all the ads I've seen, if you don't follow gaming you "could" think that kinect is a stand alone device.

gaden_malak2742d ago

"Casuals were spending $249.00 USD on a Wii when it first launched. Not to mention if you got a second Wiimote you pretty much just spent the same amount of money as a 360/Kinect Bundle."

If people are getting a Kinect are casual, it is save to assume they do not have a console.
When the Wii came out, it was the cheapest available.
When Kinect comes out, the Wii is still the cheapest.

If casuals don't have a preference, why would they pick up a Kinect over a Wii when it costs double?

+ Show (1) more replyLast reply 2742d ago
gamerzBEreal172742d ago

yea it cant be denied kinect will sell millions to bad it wont be for gamers and more for kids and will be full of gliches

MorganX2742d ago

Last time I checked, kids were gamers too.

Zir02742d ago

MS should have no problem reaching their 3ml target then.

Raendom2742d ago

500M in advertising and constant threats of it being "sold out"... yeah, I wouldn't be suprised. I mean Apple sold 1M iPads at launch, I didn't know there were 1M retards, but apparently there are.

MorganX2742d ago

Actually, given the appearance on Oprah, if it was marketing before, it's probably really a shortage now.

Appears you and MS understimated the power of an outing on Oprah!

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