Services and Delivery

The industry competes primarily on product differentiation and price, rather than on service and delivery differentiation (with the exception of the comments on the quality of online support and the online gaming experience discussed earlier).

Virtually the same strategy is followed for delivery.  Manufacturers regularly subsidize deals and promotions (price discounting) to increase sales volumes.  In addition, game consoles, accessories and games are bundled in packages where a small financial incentive exists for customers to buy them all together.  Additionally, manufacturers do contribute towards the training expenses of the salespersons.

A similar convergence of strategy amongst the main players in the industry exists for services.  The length of warranties (one year) is a standard for the industry and extended warranties can be purchased.  Since Yellow Bananas first introduced a loyalty and reward card system, the other competitors followed suite.  The operation and reward system for the loyalty cards is virtually identical.

Manufacturers also offer accidental damage insurance for an extra charge, except where distributors have a scheme of their own on offer.  This is because they believe that making a move into the financial services industry is quite lucrative.