How do some of the trade-in deals make sense?

So, while everyone seems to only be offering PSP bundles online, I’ve been trying to figure out what the hell is up with EB and their trade-in deals. To whit:

Trade in 3 select games for one of 8 Sony PSP titles.

So, for instance, I can trade in Splashdown (2nd gen PS2), Muppet Cruise Party ($12 at Sam’s Club new), and that extra copy of Jak II I got during EB’s last Buy 2, Get 1 sale, and get a brand new copy of Wipeout Pure. No extra cash changes hands.

Now, obviously EB makes great bank on used game sales. This is generally because they give you a pittance and then resell for a pittance plus at least $10. I don’t get this deal, even barring all the exploitative loopholes in their exemption lists some of the deal sites are referencing.

Anyone in the know as to what’s going back into EB’s pocket that makes it worthwhile for them to give me essentially $70 extra trade in credit on games that they don’t sell, used, for more than $50, so I can get freebie games for my PSP? I’m not complaining, but I’m curious if Sony is offering all sorts of placement/kickback for pushing PSP titles hard or what. I guess the other option is that there are enough people out there who trade in high profit used games that it evens out those of us whoa re more frugally oriented.

Oh, and if you have extra games sitting around that aren’t on this list, and are getting a PSP, and want one of either Ape Escape, Wipeout Pure, Twisted Metal Head on, ATV Offroad Fury, or any of the sony first party sports games, take three of them to your nearby EB and trade them, straight up. Or you can do like I did, and see if you can find 3 games not on that list for sale at the local EB for less than $40 (I paid $23 with tax and my 10% discount card for three games which I traded in 3 days later for a $40 game).

I’ve noticed that Pre-Owned (Used) games sell for $5-10 less than the current price.

Let’s say you buy God of War for PS2 for $49.99.
Finish it in a weekend, bring it back for a trade in.
They’ll offer you less than half - say $17. Shrink-wrap, resell for $44.99.

Yeah… and if people are trading in God of War in a week to pick up a PSP game I see it.

But they let me trade in Splashdown, Muppet Party Cruse, and Jak II. Out of those, the only one I see selling, period, is Jak II. And the normal used price for it is $17.99. I think the other two might go for $12.99 per. That’s $44 for them vs. $40 for me. When you figure in the uncertainty, 10% isn’t very worthwhile.

I’m thinking sony has some vicious kickback to incentivize the stores to offer specials on their games at the moment. I noticed Best Buy is giving $10 back if you buy any 2 PSP games, and $20 if you buy 3. That’s an insane promotion for a brand new video game. That type of cut-throat first-run stuff generally only happens with PC games.

It’s probably because Sony is tying system replenishments to the ratio of accessories and games sold per system. In other words, EB will get more PSP’s to sell if they can show they’ve sold more games and accessories. When it comes to video games, no one makes any money on the system; it’s all on the software and accessories.

Retailers want you to buy the system from them because statistically you are more likely to buy the games and accessories from the place you bought the system.

Hmmm… I hadn’t thought of that, but I can see it. It’d be worth taking some loss on the games to get people into your store to buy the PSPs and sell the (pure profit) warranties and accessories. Do you know for a fact replenishment is tied to how many first party games are being sold, or is it just conjecture? Either way it’s a mighty interesting theory.

Loss leader.
If nothing else, they get you in the store, where you might notice all the other great deals they have to offer. The worst they can do is get you coming around to the idea that they’re a good bunch to do business with.

Considering the cost of PR these days, I’d imagine it’s a good deal if they can create a future customer by only spending a couple bucks per. Hell, you’re prolly outside the bell curve (on the good side, mousey!), so they’re most likely making a couple bucks on most transactions with the average shlub, as well as possibly creating long-term customers.

That’s some good retail. A pretty good deal for them, and a smart way to start to reverse all the damage they’ve taken at the hands of Executioner5.

In order to get a chosen quantity of PSP hardware, they also had to purchase an enourmos amount of software. Typically, this is 3 software titles per hardware unit. So they are sitting on stacks and stacks of release titles. The resale value of all of these titles after six months will crash. So they are getting used titles that they can resell.

And not everyone has Muppet Cruise. Most people buy good or fair titles. Eb won’t be stuck with as many lemons as you think. Especially young kids don’t understand the value their parents spent on something like Halo 2 and trading it in is a no brainer.