Today, Microsoft reported record Black Friday week Xbox console sales -- 960,000 units. That works out to roughly one per minute, assuming six-and-a-half days of sales (reduced for Thanksgiving Day). It's a phenomenal achievement for an aging console and demonstrates how Kinect and lower-entry cost 4GB models extend Xbox vitality as a platform. Microsoft describes the milestone as the "biggest week of sales in Xbox history".
However, the sales per minute is much higher for Black Friday -- well, presumably. Microsoft says that 800,000 consoles sold in one 24-hour period, which I assume means day after Thanksgiving. That works out to 555.5555 Xboxes per minute. Consumers also snatched up 750,000 Kinect sensors -- that's standalone and bundled -- during the whole week.
The numbers are simply huge and surely also reflect some aggressive discounting by Microsoft and its retail partners. Microsoft Store chopped Kinect senor price by one-third -- $99 instead of $149 over Black Friday weekend. Then there was the Xbox 360 Kinect Holiday bundles -- $299.99 for 250GB and $199.99 for 4GB, both $100 discounts. Somebody bought them. Microsoft Store online is sold out of both 250GB Holiday bundles, with and without Kinect.
The real question to ask now: Will demand outstrip supply and are discounts really necessary to maintain sales momentum? Or has Microsoft, and its partners, already tapped the sales well dry? Discounts drew tech shoppers in droves on Black Friday as people lined up to get doorbusters. According to NPD, one-half of US electronics buyers shopped stores between Midnight and 3 am on Black Friday -- up from 13 percent last year.
Black Friday game console buyers increased by 35 percent year over year, but nowhere near smartphones -- 85 percent. Consumers spent an average $360 on tech products, up $60 from a year ago.
"While holiday sales and traffic were strong, the consumer electronics industry needs that momentum to continue in order to see just as strong a finish to the holiday season" Stephen Baker, NPD's vice president of industry analysis, says. "Consumers were driven into the stores by strong promotional deals, but the impact that aggressive pricing has on revenue will most likely outweigh the increased unit volumes".
Perhaps in some categories, but not Xbox. Even if revenues --- and more likely margins -- are less, Xbox is a platform for selling additional products and services. But that's topic for the story about the next major Xbox system update coming in just a few days.
Photo Credit: Joe Wilcox