darkSpyro

I'm curious to hear what you guys think about this idea.

As has been discussed over and over again secondary markets exist for new items because retail stores basically set a price and stick with it. They may originally be set based on supply and demand, but they often fly off the shelves when they are priced too low (and end up on ebay where someone else makes a profit), or they become shelf warmers when they are priced too high. Neither situation is good for the customer or retailer as they end up with inventory customers don't want and failed to maximize profits on what the customers do want. This happens for retail items, sporting event tickets, etc.

But there are markets where the price varies based on supply and demand. Financial investments, gas, automobiles, housing, etc.

So why not create a store that has market based pricing for retail items? It seems you could have an algorithm for determine the proper price given the supply available and the number of customers saying they would buy at a price (or who have bought at that price). For example, the price for a Light pack could be up to $50 right now, but may go down to $25 a month from now. Customers should be happy because they can get it at a fair price, or wait till they think the price is fair. The retailer will maximize profits.

The downside is that it wouldn't work well for items that are available at a set price somewhere else, although it might even the items were known for running out of stock like Skylanders do (or even for shelf warmers if there was profit to be made at a lower then retail price). It would also need to be online and offer something similar to Amazon price in order to deal with the shipping.

Scalping wouldn't be very profitable at that point, although you could probably still make a profit somewhere between retail and market value, if the item wasn't exclusive to variable pricing. And those customers with less funds would lose out to those with higher funds, at least for getting the item right away. There is no more 'getting there first to get the good deal' as the best deal will happen at some point later.

I think the reason eBay works as a place to gouge prices is because it increases the market far beyond what a single brick and mortar store could. How many people who shop in a store near you would be willing to spend $1000 on a TFB employee christmas skylander? A retail store would have to have someone in their area willing to. On eBay you only need to find one person across the entire expanse of the internet with that much money to burn.

A retail store as you describe would be able to price higher than MSRP for hot items but never as high as eBay because their audience would be smaller than eBay's. Therefore people living near such stores could still buy the toys at less than eBay prices and sell them on eBay to markets with higher demand.

The problem would not go away, it would just give the retailer a slightly larger piece of the pie in exchange for making customers irate that they have to explain to their kid that the $12 bucks of allowance they saved up isn't going to buy the toy they wanted.

As it is now you have to ask yourself, is my time standing outside a store or possibly missing work worth the $X i'm going to save by not having someone else do that for me while I work and earn a much higher wage. If you have more time than money, wait in line. If you have more money than time buy it on ebay. If you have neither time nor money wait and hope that the figure you want will be around when sales happen, but you're probably screwed for rare figures.

First off, the store wouldn't work for the the very rare, one-of-a-kind, type items. That's not what I was thinking of, and an ebay auction is the best way to maximize profits for that. More like kaos traps, wallop, the light and dark packs, and even shelf warmers like gill grunt seems to be this time around. Those items that are in high demand would be priced higher, while the shelf warmers would be lower obviously.

And yes, if the item could be purchased at a regular retail store for MSRP, then that makes a variable pricing store less effective. It still would be able to sell at above MSRP for high demand items while the supply was low, demand high. And no, this can't be a brick and mortar store since it has to capture the same audience as ebay.

Some customers would not like it, for sure. I don't know if I would. I tend to have the money to buy this stuff and the time to go get it on sale at release. At the same time, I think I'd appreciate playing the game and trying to buy when the market was low for something I highly value. I'd certainly like to pay less then MSRP for head rush, since that seems to be readily available. And honestly, I 'd pay above MSRP for some items that really mattered.