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A late Christmas for Wii seekers

Nintendo says shoppers can pay for the chronically sold-out console next week and get it in January.

December 15, 2007|Alex Pham | Times Staff Writer

Just what kids want under the Christmas tree this year: a rain check.

Nintendo Co. said Friday that it wouldn't be able to make enough of its fast-selling Wii video game consoles to keep store shelves stocked during the holidays.

So the company plans to issue tens of thousands of vouchers to customers who come up empty-handed.

The "Wii Certificates" program could help Nintendo defuse criticism over Wii shortages for a second straight holiday season and stem defections to rival consoles.

"The system has remained a sellout virtually everywhere in America nonstop from the day it launched," said Reggie Fils-Aime, president of Nintendo's U.S. business. "There was no ability for us to stockpile systems over the summer to meet the holiday rush."

The rain checks will be available only through the GameStop retail chain, at its 3,900 stores nationwide, on Dec. 20 and 21. Shoppers must pay the console's full price of $250 and pick it up in January.

Nintendo has sold more than 6 million Wii systems in North America since launching the console in November 2006.

By comparison, Sony Corp. has sold 2.4 million PlayStation 3 consoles, which were released at the same time as the Wii; and Microsoft Corp. has sold 7.9 million Xbox 360s since they debuted in November 2005, according to research firm NPD Group.

Even with constrained supply, sales of the Wii last month far outstripped those of the PS3 and the Xbox 360, according to NPD.

Fueling the sales surge is the console's popularity among people who aren't considered console jockeys.

"It's unprecedented demand from all demographic groups," said Chris Byrne, contributing editor at Toy Wishes, a consumer guide to popular toys.

"We're seeing 4-year-olds playing it. We're seeing people in their 60s playing it. We're seeing middle-class people including it in their entertainment systems in the home. It's no longer just the Dorito-munching teenage boy sitting alone in the basement."

With stores rapidly selling out of the Wii, many desperate buyers have resorted to paying as much as $500 to private sellers on Craigslist and EBay.

By avoiding resellers, consumers should have more money to spend on Wii games -- at least that's what Nintendo is hoping the rain checks will accomplish.

"This shortfall benefits no one," Fils-Aime said. "Enough systems would make everyone, including me, happier."

Actually, it could benefit Sony and Microsoft, which Nintendo doesn't want.

"Nintendo realizes that when consumers walk into Wal-Mart and they can't find a Wii, they may just buy the PS3 or Xbox 360 instead," said Colin Sebastian, an analyst with Lazard Capital Markets.

Sensing heightened demand, Nintendo has ratcheted up its Wii manufacturing since January, from 1 million consoles a month to 1.8 million. But the Japan-based company has been reluctant to expand its capacity too aggressively.

"It's very expensive to bring a new production line up and running," Sebastian said.

"It's not as easy as throwing on a switch."

Rain checks are unusual in the worlds of toys and consumer electronics, analysts said.

"It's a novel way approaching a shortage," Byrne of Toy Wishes said. "They were more common in the '60s and '70s. It was something that came over from the grocery store business. If you couldn't get your Velveeta on sale, you could get a rain check and come back next week. It's used to build customer loyalty."

But shoppers will have to hurry. Like the console itself, the rain checks are available only while supplies last.

alex.pham@latimes.com

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