| |
Discussion: Gaga's 99c deal - Smart business move vs. cheap tactic.
Member Since: 3/5/2014
Posts: 7,746
|
The fact that so many people don't understand the point of a loss leader strategy and why businesses do them. Whether or not your stan goggles want to allow you to admit it, it was a smart business move. Amazon got to promote their new cloud service at the time and Gaga sold an extra 440,000 copies of her album. It's really as simple as that. Loss leader strategies happen all of the time.
Quote:
|
The Warner/Reprise Loss Leaders were a series of promotional sampler compilation albums released by Warner Bros. Records throughout the 1970s. Each album (usually a 2-record set) contained a wide variety of tracks by artists under contract to Warner Bros. and its subsidiary labels (primarily Reprise Records); often these were singles, B-sides, non-hit album tracks, or otherwise obscure material, all designed to arouse interest in the artists' regular albums. Warner advertised the Loss Leaders albums by inserting special illustrated inner sleeves in all of its regular album releases, listing all of the currently available Loss Leaders and including an order form. Each Loss Leader double album was priced at $2USD, significantly less than a comparable regular-release double album of the time. The first Loss Leaders compilation was The 1969 Warner/Reprise Songbook, featuring a wide range of artists from Miriam Makeba to the Mothers of Invention; the last of the original series was the punk & new wave-themedTroublemakers in 1980.
|
Quote:
|
In 1979, American businessman Earl Muntz decided to sell blank tapes and VCRs as loss leaders to attract customers to his showroom, where he would then try to sell them highly profitable widescreen projection TV systems of his own design. His success continued through the early 1980s.
|
Quote:
|
Chevrolet's Corvette was originally intended in the 1950s to be an "image builder" and loss leader for General Motors, the idea being that men would go to showrooms to look at this "automotive Playboy Bunny"—which they knew they could not afford—and end up purchasing a lower-cost model. However, it enjoyed significant sales successes in the 1960s and produced a substantial annual profit.
|
Quote:
|
Inkjet printers are commonly sold at a loss. The printers usually use proprietary ink cartridges so that consumers have to buy proprietary ink refill cartridges from the manufacturer. The printer manufacturer makes the money back from the printer sale via ink sales.
|
Quote:
|
Video game consoles have commonly been sold at a loss during launch and/or a number of years after launch with the goal of getting the most number of units to consumers. Console manufacturers then recover money from the royalties out of software sales.
|
- http://en.wikipedia.org/wiki/Loss_leader
Do you people actually think multiple multi-billion dollar companies would use this type of strategy if it didn't work or if it wasn't a "smart business move"? The delusion.
|
|
|
|
Member Since: 10/29/2010
Posts: 29,249
|
Quote:
Originally posted by slobro
She paved the way for other artists to copy that same Amazon deal (Coldplay, Drake, Katy Perry, etc). Such a trendsetter
 |
Rihanna was the original 99 cents chanteuse.
|
|
|
|
Member Since: 3/15/2013
Posts: 25,504
|
Quote:
Originally posted by Bang Up
The fact that so many people don't understand the point of a loss leader strategy and why businesses do them. Whether or not your stan goggles want to allow you to admit it, it was a smart business move. Amazon got to promote their new cloud service at the time and Gaga sold an extra 440,000 copies of her album. It's really as simple as that. Loss leader strategies happen all of the time.
- http://en.wikipedia.org/wiki/Loss_leader
Do you people actually think multiple multi-billion dollar companies would use this type of strategy if it didn't work or if it wasn't a "smart business move"? The delusion. |
|
|
|
|
Member Since: 12/4/2009
Posts: 6,471
|
It was a great business move for her.
|
|
|
|
Member Since: 1/1/2014
Posts: 9,799
|
It was perfect for her because it got the album in a LOT of people's hands AND because now she has the "million in one week" title under belt. It was bad though because it did cheapen her brand, and people might hold out from now on thinking "oh I 'll just wait until she sells it for $.99 again."
|
|
|
|
Banned
Member Since: 8/19/2013
Posts: 8,254
|
It hugely backfired on her. It was just a desperate way how to artificially elevate her 1st week sales. But as a music buyer, I wouldnt complain 
|
|
|
|
Member Since: 1/1/2014
Posts: 9,799
|
Quote:
Originally posted by CannibalMonster
It's a cheap tactic and of course the Monsters support this. If this was any other artist who did this, you would all still be dragging them to the pits of hell and back.  |
Except Katy did the exact same thing for Prism in Europe, but of course, here you are in another thread about Gaga trying to bash her.
Why are you so threatened by her?
Do you get nervous every time you see a thread about her?
Do you cry at night, wishing she would just leave you and Katy alone!?
Poor it.
|
|
|
|
Banned
Member Since: 8/19/2013
Posts: 8,254
|
Quote:
Originally posted by Lights and Waves
[CENTER]Except Katy did the exact same thing for Prism in Europe, but of course, here you are in another thread about Gaga trying to bash her.
Why are you so threatened by her?
Do you get nervous every time you see a thread about her?
Do you cry at night, wishing she would just leave you and Katy alone!?
Poor it.[/CENTER]
|
She didnt ?
|
|
|
|
Member Since: 3/15/2013
Posts: 25,504
|
Quote:
Originally posted by Cola.drinker
She didnt ?
|
You have no idea how right you are, Katy didn't get paid full price for those 99c sales.
|
|
|
|
Banned
Member Since: 8/19/2013
Posts: 8,254
|
Quote:
Originally posted by Mariano
You have no idea how right you are, Katy didn't get paid full price for those 99c sales.
|
She didnt sell her albums for 0,99 US DOLLAR in Europe. Why are you even bothered by Katy, when this is not a thread about her ?
|
|
|
|
Member Since: 3/15/2013
Posts: 25,504
|
Quote:
Originally posted by Cola.drinker
She didnt sell her albums for 0,99 US DOLLAR in Europe. Why are you even bothered by Katy, when this is not a thread about her ?
|
She was mentioned and I replied. I didn't bring her up 
|
|
|
|
Member Since: 4/6/2014
Posts: 2,407
|
|
|
|
|
Member Since: 1/1/2014
Posts: 9,799
|
Quote:
Originally posted by Mariano
You have no idea how right you are, Katy didn't get paid full price for those 99c sales.
|
Vaporize ha!
|
|
|
|
Member Since: 4/3/2014
Posts: 7,895
|
I of course bought the album at full price, but for some people with less coins, Lady Gaga the 21st Century Mother Teresa makes it all possible. Only the True Charitable Generous Queen.
|
|
|
|
Member Since: 8/4/2012
Posts: 6,823
|
Quote:
Originally posted by alex_katycat
Selling your album for 0,99$ is a cheap tactic ofcourse. You just try to sell more copies of your album. But it wasn't illegal ofcourse, anybody has the right to do it, but still...it's a cheap tactic.
|
Since we're talking about cheap tactics . Releasing a remix with some other singer to make your single go #1 so it can break a record isn't a cheap tactic , right?
Seems like Gaga fans are not the only ones who need to use an asterix after all.
---
To answer the question: It wasn't a cheap tactic
|
|
|
|
Member Since: 8/19/2013
Posts: 58,053
|
Cheap tactic.
but then again Amazon did the deal... so...
Promotional tactic.
|
|
|
|
Member Since: 3/5/2012
Posts: 2,180
|
|
|
|
|
Member Since: 3/22/2012
Posts: 9,573
|
Quote:
Originally posted by jomarr
Cheap tactic.
I'd rather sell 50K albums at 12.99 = 650k USD
than 300K albums (the number the Monsters say were bec of the Amazon deal) for 0.99 = 297K USD
I'd rather sell little and profit more than sell a lot at a loss.
And with that, I know those 50K albums sold were all about my music than those 300K who bought the album at an impulse.
Contrary to Gaga's statement, it's all bout the bling. If not, then she wouldn't promote it everywhere
|
Stay in school kids that reading comprehension aint your cup of tea.
|
|
|
|
Member Since: 1/2/2014
Posts: 8,759
|
Quote:
Originally posted by Mariano
Sis Selling 400k albums for 0.99c and getting paid FULL PRICE and Selling 400k albums full price is THE SAME 
I can't believe people still don't understand how that deal worked  |
Quote:
Originally posted by Mariano
The deal was offered by AMAZON, not by Interscope to AMAZON.
And BTW would've opened with 800k+ NO matter what.
BTW single opened with 420k in 2.5 days. . . she already had impressive sales behind her back. 1 year into her career, she had 2 albums with 150-200k+ sales in top 5 on BB200 .. Like how hard is it to grasp |
Quote:
Originally posted by Mariano
No one outside the stan world, cares about that tho. It didn't damage her brand, not even in the slightest  She just reached more consumers and erned more money. I don't see anything dragable about that
If I was a CEO at Interscope, I would've said YES.. unless I was retarded or hated my company. |
Quote:
Originally posted by Mariano
BTW sold 300k+ in its first day. How is that not a smash album ? It was the most anticipated album of the last decade. |
Quote:
Originally posted by Mariano
Why did they count it in the first place then ? Why didn't try to go against Gaga, Interscope and Amazon ?
+ I can guarantee you that if Interscope get the same deal again, they'll still accept it, even tho it won't count for BB cuz Money are Money and record labels need money in order to survive.
Only an artist with Gaga's demand (at the time) could've gotten that deal.
The album sold 400k copies at 0.99 in less than 2 days, + 700K copies at full price (300k in the first day).
The lead single for that album debuted at number 1 on BB100 with 2.5 days of sales.
|
Quote:
Originally posted by Mariano
Interscope might have undervalued Gaga for Money, but your statement is dull and makes 0 sense.
|
Quote:
Originally posted by Mariano
I bet even you don't believe what you just said |
Quote:
Originally posted by Mariano
I think it kind of worked for them ... Everyone was talking about Gaga and Amazon, let alone these 400k sales in 2 days (and that's only BTW, while some of these people definitely bought other products on Amazon) ..
Don't forget that they also earn money from advertising ... 400k users (in 2 days) using the website just for Gaga.. I don't think they lost money ...
|
Quote:
Originally posted by Mariano
You have no idea how right you are, Katy didn't get paid full price for those 99c sales.
|
|
|
|
|
Member Since: 7/12/2009
Posts: 15,281
|
Some people are just bad with logic and especially business, marketing and advertising. E.g. the 3rd post in this topic. We can't all be Little Managers and bless those that do not have education to make them understand these things. It's easy thing for the haters to drag with, while it is actually a self-drag because they fail to understand. However, trolls and haters will be trolls and haters.
|
|
|
|
|
|
