Quoted from jeffspinballpalace:
You correctly highlighted that Stern must do something differently in order to be able to sell home editions for $3k. I am suggesting Stern cut their profit per machine down to zero if necessary, in order to introduce this new product. From a strategic point of view, if Stern wanted to create a new market and were willing to forgo $2k - $5k they typically make per game, it could happen. Why would they do this? Oh I don’t know but let’s review the definition of loss leader.
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The purpose is defined by an expectation to sell additional goods to buyer in order to make up for the initial loss. Since this is a new product category, maybe they expect buyers to one day buy a full feature game. Other worthwhile goals might include penetrating an untapped market and applying pressure on competitors to keep their offer prices low and hasten their demise.
Stern won’t sell many home editions at $4k but they could sell thousands at $3k. Let’s face it they will still make some money even at this level and they could choose to further engineer reductions. For instance, some have questioned whether playfield is solid wood and whether it is full length. If not,’ those are areas which could be further cost reduced in order to increase profit per game selling at $3k.
Sorry, I don't think the loss leader strategy really applies in the pinball arena. Loss Leader examples are commonly someone like Wal-Mart offering lawn chairs at $5.00 a piece so they can get you into the store to buy milk and and bread at normal, or even slightly higher than normal prices.
It's not like you're going to Stern for a home version pin, and walking out with a couple of pros and an LE.