Thursday, February 10, 2011
Are Low Prices On Older Products Beneficial for Everyone?
A report in Yahoo! Finance discusses the prediction that several high-tech items will be cheaper in 2011. Different products have different reasons for lowering their prices. For example, the current versions of the Kindle and Wii are expected to be cheaper because newer versions are coming out this year. A lot of people don't consider the fact that they can still buy the older version of a product after the newer version comes out. Articles like this one may turn people to the fact that this is possible. My initial reaction would be that the companies selling these electronics would be upset about this because they may not have as many consumers wanting to buy their new product. But then I considered the fact that consumers are still buying what the producers are selling, even if it's cheaper. Companies don't want to lose out on the money they've made producing the older versions, so people taking advantage of these deals isn't bad news for them. Plus if people rush to buy the older versions when they become cheaper, they may become sold out or very scarce. This forces others to buy the newer version, so the company gets a win-win.