Consoles score big over holidays: Staggered supply keeps sales steady - Microsoft Corp.'s X-Box and Nintendo of America's GameCube consoles are big sellers - Brief Article - Statistical Data Included

DSN Retailing Today, Jan 7, 2002 by Doug Desjardins

NATIONWIDE DSNRT REPORT -- Microsoft Corp.'s X-Box and Nintendo of America's GameCube consoles sold through as fast as they hit stores during the holidays. However, retailers said weekly shipments helped curtail inventory disasters like the one that plagued Sony Computer Entertainment's launch of Playstation 2 last year. X-Box and GameCube each sold close to 1 million units during their first month in stores. Retailers said sales for all video game consoles were strong throughout the holidays.

"All three are doing really well, though they're sometimes hard to find," Wal-Mart spokeswoman Susanne Decker told DSN Retailing Today days before Christmas. "We're getting weekly replenishments, so we have a steady supply"

Circuit City had an adequate supply of consoles, though it occasionally had to deal with out-of-stock situations. "Demand is still exceeding supply, but it's nothing like the tightness we experienced last year with Playstation 2," said Circuit City's Bill Cimino. "With X-Box and GameCube, supply hasn't caught up with demand yet, but we've been able to keep them on the shelves."

Online retailer Toysrus.com also reported that torrid sales often outstripped supply "We have four different packages for the X-Box, and we have only one in stock right now," said Toys "R" Us vp Jeanne Meyer on Dec. 19. "We expected everything we put up to sell through, and that's proven to be the case for us and for retailers across the board."

Microsoft said it shipped 1.1 million X-Box systems to retail by mid-December and would reach its goal of 1.4 million units by the end of the year. Nintendo also reported shipments of 1.1 million GameCube units to retail by mid-December and said it would continue to ship 100,000 units per week through January Sony had no problem replenishing its stock and projected total Playstation 2 sales of 5.7 million for 2001.

Industry analyst Michael Goodman said a clear winner in the video game console wars probably won't emerge until later this year when the dust settles from a frantic fourth quarter.

"Most of the people who buy new systems when they're launched are early adopters or hard core garners, so everything is going to sell through," said Goodman, an analyst with The Yankee Group in Boston. "We'll have a better idea of what's happening after the first wave is done."