Finally, two years on from its original release, you can a PS5 without much hassle. It might sound odd to report on the fact that you can buy a company’s product, but this generation of consoles has been defined by shortages — with similar scarcity surrounding theXbox Series X|S— largely caused by the COVID-19 pandemic.
But shortages aren’t exactly a new thing in this industry. From theNES ClassicandAmiiboto theKinectandXbox OneElite controller, there’s a whole history of supply failure to dig into. Though these incidents might seem innocent on the surface, there’s a wealth of benefits for companies to make their products harder to get — along with a whole heap of consequences for consumers.
Let’s look at the chief culprit for shortages over the years:Nintendo. Nintendo has a lengthy track record of undersupplying their products, witheven the hugely successful Wii being hard to findaround the time of its release.
Nintendo’s most infamous example of not meeting demand comes from its Amiibo products. These figurines are synonymous with scarcity and many are still dramatically inflated in price. Given how these figures are a well-known example of this shortage trend, we can use them to look simply at why these instances of scarcity happen. By undersupplying these figures, artificial demand is created due to their rarity. Because of this, prices are driven up on the second-hand market, like we saw withscalpers buying up PS5 and Xbox Series stockthen selling it at absurd prices. Whilst scalping doesn’t benefit Nintendo (or any other game company faced with a lack of supply) directly, it does drive up the value of these products when they’re restocked.
Of course, whilst we’re talking about Nintendo specifically, their shortages (from the Wii to Amiibo to the NES Classic and beyond) have an element to them that’s distinctly theirs. Since the days of the ‘Nintendo Seal of Quality,’ Nintendo has always tried to keep up the reputation of having the highest standards.
Keeping the value of their products high through undersupply is similar to how their games rarely drop in price — they pursue creating experiences separate from the rest of the industry. This goal explains why Nintendo is prime for these type of situations; given the frequency of them undersupplying hardware, it’s unlikely to be a symptom ofpureincompetence. Naturally,Nintendo gets pulled up on this from time to time, but of course denies any intent behind it.
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This phenomenon extends beyond just Nintendo — with the most prolific example of recent years being the PS5. Just as with Amiibo before it, the console had long seen massive hikes in price on the second-hand market due to scalping, with huge sales following restocks, andeventual price hikes.
How has become a norm in the industry? Well, in the case of the Amiibo and NES Classic, we see overlap with the collectible industry — a market very close to gaming with a high amount of cross-pollination. These items are collectibles as well as videogame hardware, especially Amiibo. This wouldn’t explain the approach of the whole industry, however.
A lot of this can come down to good old-fashioned FOMO. Demand generated by scarcity (artificial or legitimate) ultimately creates a sense of FOMO; restocked inventory will sell because the item has been made to seem rare — even those disinterested in the product might indulge in it if they happen across it due to the false rarity.
We see FOMO in full gear inlive serviceand free-to-play games that rely on cosmetic microtransactions and limited-time events like sales or Season Passes. Game monetization, be it hardware or live services, is increasingly becoming reliant on manipulating us into a perception of scarcity (thoughsome games, like Halo Infinite, are admirably moving away from this model).
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Let’s apply this FOMO idea to the PS5 launch.Preorders for the PS5 used a registration system, where consumers had to apply for an invitation just to have a chance at buying the console. Customers were tacitly encouraged to do things they wouldn’t normally do to be in with a chance of preordering a PS5; it made the process of paying upfront for a PS5feellike you were entering into a competition towina PS5.
Shortages - or the perception of them - ultimately work for the manufacturer, practically been printing money for the industry.
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