Friday, June 15, 2007

Wii supply: An eternal shortage?

It's no secret that the Wii is a hot item right now. It's sold basically one million consoles per month world wide since November. But, shortages still persist! People still call their local Wal-Marts on Sundays asking if they got more! Will the shortage ever end?

I go to my local Wal-Mart about once every two weeks, and since the Wii came out, I still haven't seen a single console on the shelves. Oh, they're getting shipments, make no mistake. They just keep selling out within the hour! This has been the case for nearly eight months now, and it doesn't seem close to an end. When will the Wii madness finally even out with supply?

Personally, I don't think we'll be seeing a global example of supply = demand until at least 2008. Sure, there are stores here and there with a Wii or two on the shelf, even as I type this, but they are few and very, very far apart.

When it comes to production, Nintendo doesn't have as many options as Microsoft and Sony. Both of the competitors own many more factories due to the companies focusing on more than just video games. If there's a shortage of XBox 360s, Microsoft merely gets a factory churning out PCs to turn their attention to the XBox. Nintendo doesn't have this luxury. They have so many factories making Wii consoles, and nothing else. They don't own or rent any factories that aren't already producing the rapid-selling little white box. If they need a new factory, they need to either build one or strike a deal with the owners. Either way, it'll take a while before the outlets to start production.

Also, instead of consumer interest generally going down later on in a console's life, the Wii's popularity goes nowhere but up! Why? Word of mouth, my friend. One person buys a Wii, and tells ten friends. Then, at least five of those friends get their own consoles, and they all tell ten friends. It just keeps snowballing from there!

And then there's the real problem: The holidays. Every single product on the market sees a huge boost in sales around American Thanksgiving, and the Wii will definitely be no exception. Compounding with the increased Christmas demand will be all the amazing software hitting the market around the same time. Super Mario Galaxy, Smash Bros. Brawl, MySims, and a whole crapload of stuff we don't even know about yet! All this adds up to a HUGE demand for a lacking supply.

There have been very subtle hints at a slowing demand, though. Lately I've been seeing more and more Wiimotes sitting on the shelves in stores, alongside many other accessories. But, this could just be a sign that all of the early adopters have already gotten all they need, and that newer Wii owners are the only ones buying the accessories nowadays.

So, what do you guys think? When will demand equal supply? When will we start consistently seeing Wii consoles on store shelves? It's your turn to talk, folks!

The Duck Has Spoken.


Anonymous said...

are you actually a duck?

Frost said...

I work at Toys R Us and I have seen this effect first hand. Since January after the holiday shipments we've been getting Wii's nearly every two weeks on a Sunday with about 50 consoles at a time. This of course was a planned semi launch conducted by the big wigs at Toys R Us to create traffic and buzz every Sunday to coincide with the weekly sales ad that people would get in their mail. These events or "Wii Sundays" (a phrase we and the public would say) would draw lines of usually 70 to 80 people. Most lining up well before 6:00 a.m. Some may see this tactic of holding Wii's a week in advance unfair but at least to myself and some of the public it made buying Wii's easier. We would get 20 calls a day asking when we would get a shipment and it was much easier saying "wait till Sunday we'll have a lot" rather then telling people "we really don't know its sporadic at best when we get them in and we only get 10 or less." It gave people an organized schedule and routine of shipments.

Everything remained the same till yesterday. That has all changed. Toys R Us will be disbanding these "Wii Sundays" and now will be putting out Wii's on the floor as soon as we get them in. Just this week we got 45 on Sunday for our last Wii Sunday. We received another shipment Tuesday morning with another 45 pieces and just yesterday we got another 45. This is unprecedented in terms of shipments. I'm not sure if this is a minor fluke in excess product at the regional warehouse or a sign that Nintendo has significantly increased production. Whats surprising is that these systems are still selling out that day. Yes, it is true that this system is for everyone even non-gamers. It’s hard to believe but many this week bought the system for Fathers Days. An old lady was buying a Wii for her 65-year-old husband as a Fathers day gift. She didn't know what game to get him but i recommended Brain Academy and she thought that would be the perfect game for her husband. On top of this many customers are buying Wii's for friends and family members who were unsuccessful in finding a system. Like you said one customer calls another and another and the snowball effect continues. There is a drastic change happening in this industry and soon everyone will feel it.

On a side note if your bored I created a documentary titled "7 Days Till Launch” It’s about the wii and ps3 launch. It gives you a perspective of employee’s point of view of the whole massive video game launch. Yea I know it’s a cheap plug but hey if your bored and like Nintendo it will pass some time.

PsychoDuck said...

Hey, I'm cool with cheap plugs, Frost. In fact, that's probably how you got here XD

And I am a duck. In spirit :)

The Duck Has Spoken.

Reed said...

Unfortunately (and I was SO angry) when I went to Target this last Sunday they had 3 Wiis. Unfortunately I only had about $150...:(

Wiimo said...

I'm not sure if Nintendo can EVER keep up with the demand. It's evident to happen, but not in the foreseeable future. Like you said, it becomes even more hectic when the "Holy Trinity" launch at the year's end. Something else to consider: people are holding out for a black Wii or other variations. I think it's a proven fact though, that Nintendo is making more units each month than the 2 competitors. Which is why the sales charts show Wii blowing 360/PS3 out of the water; even 6 months into it's life cycle!

ivhuro said...

I still don't have a wii and i don't bother anymore to call the stores or to ask if they have wii's. I'll just wait until there's enough supply to buy one. And while waiting i'm building up my wii games collection so I can have enough games to play once i get my wii.

2tone said...

at launch i was not all that interested in the wii. that is until a few weeks ago a friend invited me over to play his wii in hi def. the next day i was calling stores and looking. within an hour i had found out that best buy had 4 left. i was excited. i got there only to have 4 senior citizens push me out of the way to get to it first. i was shocked. i mean 3 old ladies like my grandmother and an old Asian fellow. who refused to get near me afterwards (guess he thought i was going to try and steal it) me and a friend i was with just ended up standing in the same spot in front of the wii rack. FOR AN HOUR. it took that long to sink in that we (basically) had the wii's stolen from us. in fact that was about 2 weeks ago and I'm still shocked. oh by the way. THIS IS 10 MONTHS AFTER LAUNCH!!!!!

Anonymous said...

Yea. I had a lot of money saved up. Then, one day I went to a friend's house to play Wii. Next thing you know I was calling stores. Even now it's still pretty hard to find a Wii.