Xbox 360 Launch 2.0

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Q: How does one make a year old video game system more interesting to consumers than the ones that just launched?

A: Mark it down 66%!

On Thanksgiving, Amazon offered a limited number of Xbox 360 core system’s for $100 — 2/3rd off retail price. Amazon’s promotion was so popular that the site ran at a snails pace for a full 40 minutes as deal hunters slammed Amazon servers trying to get in on the promotion.

On a pure traffic volume basis, the 360 generated more online interest on the 23rd, than either the Playstation 3 or Wii commanded on their respective launch days, making one thing clear — the Amazon promotion was the Xbox 360′s Launch 2.0.

During the past few weeks there has been intense media focus on the Wii and PS3. However, the older Xbox 360 has been holding its own against the newer consoles. The Xbox seems to be benefiting from all the new consumer interest around the other two consoles, as consumers research and evaluate all their buying options.

The chart below shows weekly demand for all three consoles through the week of November 25th:

  • The 360, despite being a year older, has been exhibiting similar demand patterns as the Wii, which launched on the 19th.
  • During the week of the 25th, demand for both the Xbox 360 and Wii surpassed demand for the PS3.
  • One week after launch, online demand for the PS3 dropped nearly 15%.

Daily demand for each console tells us an even more interesting story. The chart below illustrates daily demand for the Wii and PS3 from a week prior to launch to a week after launch, and also the Xbox 360 $100 promo “launch”:

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  • The Xbox 360 $100 deal traffic spike mimics the launch of the two other consoles.
  • Wii demand has held relatively steady since launch, while demand for the PS3 and Xbox 360 have dropped.

All in all, the $100 Xbox promotion on Amazon yielded a lot of interest in the 360 on the busiest shopping weekend of the year, and that Microsoft (with Amazon’s help) has sent a powerful message to would-be Wii and PS3 buyers: the "on" button is always greener on a system that you can actually buy in time for the holidays.

Note: Compete, Inc. calculated console demand based on the number of U.S. consumers who shopped for the respective consoles at leading online retailers. Amazon’s special $100 Xbox promo pages were excluded from the analysis.

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