Wednesday, 24 November 2010

Is Amazon’s black Friday a moment of genius or a massive con?

Black Friday is an American import which signals the start of the Christmas shopping period. It is called black Friday as it’s the day when companies go from in the red to into the black in terms of their balance sheets. This American tradition has brought its way to the UK this year with Amazon’s black Friday. This week long sales promotion boasts sales of up to 70% off certain items and with Nintendo Wii’s selling for £50 there has been a huge buzz around the sale.

The way it works is Amazon display’s on average three products an hour. After the timer gets to zero consumers are allowed to add the product to the cart, the picture below helps illustrate this:

The consumer does not know the discount of every product so when the timer reaches zero there is a massive rush to buy. Amazon have been very clever with this concept as they have made it somewhat of a game. If a person ‘wins’ a product they feel a sense of achievement and are encouraged to keep on looking and more importantly buying these deals.

The whole premise of Amazon’s black Friday deals are that they are offering huge discounts. On Friday the 19th of November various newspapers promoted the fact that on Monday at 9am 'Take That' and 'Susan Boyle’s' album would be selling for only £1. Needless to say these products sold out in a matter of seconds however with deals that good surely every product will have those discounts? Well no, many of the products on sale don’t have great discounts. In fact Amazon raised the price of a few products a month before the sales went ahead so that they can be seen to offer a greater discount when they sell it on black Friday week. Furthermore, the discounts are against the RRP take into account that many online retailers sell well below the RRP to gain a competitive advantage, the discounts don’t sound so good. This hasn’t stopped consumers buying these products though, the buzz of getting that product when the timer ticks down to zero is highly addictive, Amazon have got this sales promotion spot on.

Another thing to mention is that Amazon have discounted various products across the site which are not of limited quantity or time restricted. People will spend hours on the amazon website this week due to the promotions and media buzz around this event. With more and more individuals Christmas shopping online Amazon are making sure that they can entice customers to shop with them this Christmas as they are seen to offer the best discounts.

It’s the usual trick of offering a few products at loss making prices to create buzz to hook people in. Expect Amazon to do this every year from now on and for other websites to follow suit. Black Friday could be a new phrase we hear every year on the run up to Christmas.

James Foti

Thursday, 4 November 2010

Kinect's Huge Marketing Push

Microsoft as predicted are really pushing sales of Kinect this Christmas. As the hardware is released this week you will see numerous ads on Tv, Magazines and Billboards not to mention online ads such as the one seen on youtube right now.

The added touch of having the product shown and endorsed by the likes of Oprah and Ellen Degeneres will have worked wonders in getting those 'soccer mums' to buy the Kinect. This bring me onto the playstation Move, Sony are definitely targeting this product to the hardcore more than the casual now. Their marketing budget wasn't nearly enough to stop Kinect this Christmas. This doesn't mean the move wont be profitable, the sophisticated hardware is likely to prove popular with the hardcore but don't expect the same level of success as the Kinect.