Flat Screen Demand & Sales Late 2010

Report 2 – Product Demand & Pricing

Flat Screen Demand & Sales Pricing

In report one, I briefly explained the trend in the flat screen TV market. Now in report two, I will expand upon the topic and explore the Demand and Pricing structure firms use to quickly sell product to the consumer. Retailers and Wholesalers want to move their inventory rapidly and increase their turns as a measure of performance. They achieve this by using models to understand the market outlook, current demand, DOS (Days of Supply) in the supply chain and then they price their products appropriately to maximize their selling opportunity while reducing inventory levels.

With the Christmas rush in full effect, consumers are flocking to the big box stores and going online to grab last minute deals for the holiday season. Retailers are pulling out all the stops, using all the buzz words like: holiday blowout, last few, buy now! So there are lots of deals out there right now. TV’s are dropping in price because the marginal utility is decreasing by consumers in the market. They already have more than one. Also the supply side was higher this year. Marketing analysts predicted better sales around the soccer World Cup and failed to capitalize because prices were left higher and flat earlier this year. So now that year end is here, the supply side will be corrected on retail sales.

The fourth quarter of 2010 saw prices plunge on flat screens to historic lows. Prices are sensitive in the TV market. Consumers are becoming more educated in their buying decisions through internet research and perusing all the deals before they make the decision to purchase. They have quicker access to information, like on their droid or iphone. So quicker decision making coupled with lower prices should equal greater revenues this holiday season.

Now let’s take a look at their pricing strategy. Online sites like Amazon, Best buy, and Tiger Direct are changing deals every day. I just got an email...