Monday, July 27, 2009

Palm Pre Launched...and this was done at a very special price!

Palm Pre, the Iphone's competitor, has been launched and customers searching for a bargain online were just surprised! Best Buy had lowered the price of the Palm Pre by more than half over the weekend. Unfortunately this surprise was short lived as it turned out to be a mistake, although it was one which many were able to exploit.

The confusion stemmed from an in-store promotion offering the device, usually sold by Best Buy for $199, for $99. It appears the idea was to simply promote Best Buy’s standard offer, but an error with promotional material unintentionally turned it into a sale deal.

Palm Pre

If this had happened in the early nineties the impact of this mistake would have been very limited however with the spread of the Internet, the consequences were not small. Potential buyers started noticing the price and started informing others online. As the word spread out the number of units sold started to increase.

Best Buy confirmed, through its marketing manager, that the discounted price as actually a mistake. He said that the company is composed of humans and that these are bound to making mistakes. He also confirmed that the orders were honoured even those that were made at the price of $99.

Some people do not believe the mistake issue but are coming up with various theories of why Best Buy came up with a discounted price. One of these theories suggest that Palm or Best Buy is planning a price cut for later in the year, perhaps for a back to school promotion, and that this promotion was activated in advance by mistake. Another advanced theory is that the firm wanted a relatively cheap way of researching how popular such a price cut would be. The incident has certainly generated plenty of publicity for the idea that a $99 Palm Pre would be good value. However, there’s no guarantee that people giving the obvious response that $99 is better than $199 would translate into a suitable increase in profits.

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