Hidden meaning behind newegg trade-in program?

[Zerrymause]

I think there's an important aspect to newegg's trade-in program that's being overlooked. As was discussed and seen on The Wan Show, the margins for these trade ins aren't that fat, and when you consider taxation, shipping cost, testing cost, warranty, and every other factor, it's not really as much of a money maker as it seems at first glance...
However, as was also apparent on The Wan Show, some of these trade-in values aren't actually that far from the current selling price of these GPUs, which are still dropping. Why sell a GPU online for $120, and have to deal with flaky buyers, ebay fees, shipping, etc, when you can conveniently send it to Newegg and get $90 off your GPU purchase?
Newegg has now secured a new GPU sale, for sure that's incentive, and they have another product to sell that they might even make some amount of money on. But more importantly, they now set the price. No longer is that GPU selling for $120 on ebay, and certainly, you won't see someone selling their GPU for $90 on ebay if they can get $90 from it through a much more convenient newegg program.

The real reason Newegg is suddenly interested in new hardware is to keep GPU prices from further tanking. This is, I would wager, a strategy more to keep prices artificially high and control the market than it is to make a quick buck on some low-margin sales.

[LogicalDrm]

4 hours ago, Zerrymause said:

The real reason Newegg is suddenly interested in new hardware is to keep GPU prices from further tanking. This is, I would wager, a strategy more to keep prices artificially high and control the market than it is to make a quick buck on some low-margin sales.

Do you understand how markets work? Or what conspiracy means? If you do, you wouldn't be making this kind of bs conclusions. The first paragaph describes normal business plan, and something which have been in place in various forms for decades. More notably with phones recently, or with cars. The real reason however isn't something silly as keeping prices high. Why? Because you are talking about one chain-store, and one country. It would be conspiracy if also Best Buy and Amazon (and any other bigger tech retailer in US) started to do same thing. Maybe added some fishy actions from eBay and Amazon Marketplace to make asking prices of used GPUs much higher than they should be. Then we would be talking about conspiracy.

 

But now, its just plain old business plan. The margins aren't great for reselling bought cards, but thats also not point when its not the whole business model of the company. The point and business model is that if you offer to buy used hardware, the customer is more likely to spend that money in same place. They could easily add some bonus if you make it store credit instead of pure cash, which means they don't actually pay anything out. All stays inside the system.