Originally Posted by Masta Squidge
Originally Posted by Stealth Pyros
$500 product X 10,000 customers = $5 million
$5 product X 1,000,000 customers = $5 million
Do you see why they don't bother dropping the price? At $500 they only need 1/100th of the number of customers to make the same amount of money as if they were to drop the price drastically to attract 100x the customers. The mass sales "rule" you're speaking of doesn't necessarily apply to every industry.
Nor does it follow that decreasing the price will generate enough new sales to cover the difference.
In reality, a price drop doesn't translate very well to increase sales. People are still only going to buy what they need, if you don't increase demand, then price drops too.
People don't just go out and buy an OS because it is a good deal. They buy it because they need it. They also don't buy it when they don't need it, and how many times have you gone out and purchased more than one copy of windows per PC?
Very true, but I'd say specifically in the case of PhotoShop, the demand for it has gone up in recent years because more people are "getting into" photography. The massive availability of smartphones with cameras, and extremely affordable digital cameras has a trickling effect that is probably affecting Adobe in a positive manner
Gradual price drops do well with video game sales and tech products in general. I'd say price drops don't
do well for things like books and other products that aren't really for repeated and long-term use. For example: a hairbrush, a hair dryer, a pack of pens, a bag of snacks, etc.
I think Windows 8 upgrades were priced extremely fairly at launch, but I think they should have just stuck with such prices. Microsoft needs to work to get all PC users on the same level, rather than having millions that are still behind on XP, and in that case, a price drop on Windows 8 could definitely attract more XP users.Edited by Stealth Pyros - 5/31/13 at 11:38am