Case 24 — PlayStation · Ken Kutaragi · 1993
The console loses money on every unit sold. What makes that a strategy rather than a mistake?
Sony's console will cost more to build than anyone will pay for it. Nintendo and Sega dominate the market and sell cartridges. You have chosen the CD-ROM instead: discs cost cents to press against roughly $20 for a cartridge, and they can be manufactured in days rather than months. Senior Sony leadership is hostile to the whole project.
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§02 — More forks
- Lululemon · 1998You have one store, no ad budget, and a pair of yoga pants that costs four times what anyone pays today. How do you price it?
- Nike · 1984You can sign five established NBA players, or spend the whole basketball budget on one rookie who would rather sign with your competitor. Which?
- Amazon · 2000Do you let outside sellers compete with you, on your own product pages, for your own customers?
- Glossier · 2023The thing that made your brand special is the thing now capping its growth. Do you break your own rule?