Thursday, September 03, 2009

The difference between sell in and sell through ...

The Palm Pre vs the iPhone:

"... analyst David Eller asserted in a research note this morning that sales of the Pre “are continuing to slow,” and “likely will come in dramatically below” Sprint’s (S) reputed target of 1 million to 1.5 million customers for the year. Eller now sees the company selling 416,000 units in the August quarter overall, down from a previous estimate of 488,000. For the November quarter, Eller expects the company to ship 785,000 units."

The confusion between sell-in and sell-through continues.

In the piece above from Barron's Tech Trader Daily Blog, the terms SELL IN & SELL THROUGH are used interchangeably. Sell-in units are sales by Palm to those who sell to end-users (IE Best Buy/Sprint Stores/Radio Shack), Sell-through units are sales to end-users (IE You, Me, Shoppers, Corporations).

The 416,000 is a sell-THROUGH rate, the 700,000+ is a sell-in rate.

Palm sold-IN somewhere between 50,000 and 100,000 LAST quarter ... they sold-through none at all.

Because of worldwide demand for the Apple iPhone - "sell through rates" for the iPhone at retailers are nearly neck and neck with Apple's "sell in rates".

This means there was still a glut of Pre's lying around at retailers.

When I went into a Sprint Store last month, the sales associate, in a dead store, in a busy area, hadn't seen but about 3 sales a week.

I see an iPhone at least 3 times a day and I take notice of just about everyone's phone nowadays and usually even discuss their phone with them if we have more than 10 seconds together ... agree with John Gruber of Daring Fireball from yesterday ...

"Anecdotally, I haven’t seen a single Pre in use in real life."

The Pre isn't stoking demand for Sprint as much as anticipated.

The iPhone, even with the mass attack on AT&T service, is generating an enormous influx of users for AT&T.

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