U.S. Black Friday: PND commoditization?

U.S. Black Friday: PND commoditization?
Black Friday, the biggest sale day in the United States is tomorrow. PND manufacturer’s offers have been known for a few days now. There will be a strong competition in the $79.98 (yes, $79!) to $129 price range (excluding local taxes). The lowest price is a Mio C220 to be available at PepBoys for $79 (after a $40 mail-in rebate), then a Navigon 2100 (with lifetime traffic subscription included) for $99 at Staples, a TomTom One at $119 from Best Buy, a Garmin StreetPilot C330 at Wal-Mart ($128.88) and a Magellan RoadMate 1200 for $129 (Circuit City).

Manufacturers are cutting their prices on selected item by 35 to 50%. Black Friday is about the lowest price but not all manufacturers have adopted the same tactics. TomTom, Mio and Navigon chose essentially to discount their entry level device while Garmin and Magellan adopted another strategy with sales at different price points in their product range for devices such as the Garmin Nuvi 350, StreetPilot C550, Garmin Nuvi 660, Magellan Maestro 4000, 4040, 4250.

In one year prices have declined sharply. In November 2006 when Mio aggressively priced its entry level PND at $149 it gained around 30% market share during the black Friday week. This year the same kind of product is $79.

Thursday, November 22nd 2007

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