Nintendo question retail Xbox promotions

Peter Main, Nintendo's Executive VP of Sales & Marketing, has had to face up to a letter he wrote to retailers which questioned their point-of-sales advertising for Xbox, despite Microsoft's "current zero share of the business", and the product's unknown release date. Main says that he believes this year to be another transition year for the industry, after a decline in revenues last year of between 5% and 6%. This important period (the front nine months of 2001) is absolutely critical to reversing the volume decline. Stressing that he does not want to tell retailers how to run their businesses then, Main questioned the presence of Xbox advertising. "Video games -hardware, software and accessories- hardly represent one of life's necessities and are therefore bought largely, on an impulse basis," he said. "This is why both manufacturers/publishers and retailers rarely promote new products beyond the proven maximum 4-8 weeks before launch." As the letter explained, telling people to go away and sit on their hands for nine months is financial suicide in an industry that thrives on impulse sales. After outlining the problem, it stressed that the solution lies with promoting current products. IGN asked some tough questions of another Marketing VP, George Harrison, who told them that "the purpose of the letter was to express to retailers our own curiosity as to why they felt this material belonged in their store. We clearly understood our competitor's motivation. Microsoft is not in the business, but they would like nothing more than to say to people, 'Don't buy PlayStation 2 -- wait until next October'." The confidential letter can be seen half way down this IGN interview with Harrison. Related Feature - GameCube : The Science Bit

Source - IGN