The Wall Street Journal, on Apple-watcher Victor Castroll’s efforts to count iPad preorder numbers:
Castroll primarily follows Apple as an investor because clues are available to create such an assessment. “If you want to know Apple sales, you can look at order numbers or you can see people walking into a store,” he said. Other companies, by contrast, are “a black box.”
There’s been a lot of silly hype about how the preorders “fell off a cliff” after the first day, mostly by Apple haters. But even if we were to accept it as a negative indicator, the WSJ points out it’s no prediction of a product’s long-term success:
….Yet early sales numbers are far from definitive. Studio executives can tell their technology counterparts all about the dangers of paying such figures too much heed. A year ago, “Watchmen” debuted to an impressive opening-weekend box-office take of $55.2 million, according to Hollywood.com. It didn’t make that much in the rest of its domestic run, finishing with a gross of $107.5 million. Eight months later, its studio, Warner Bros., released “The Blind Side” and raked in a more modest opening-weekend total of $34.1 million. That film’s box-office total is $252.7 million and counting — more than twice the total for “Watchmen.”
And the iPhone experienced similar bad guesses from “experts” at launch:
Gene Munster, senior research analyst at Piper Jaffray, recalled taking phone calls from investors who considered the iPhone “dead on arrival” soon after its launch when early numbers from AT&T Wireless missed early sales forecasts. Munster pointed out that word of mouth and strong sustained sales rates rewrote that first impression.
Munster’s own forecast was among those that overstated early iPhone sales, predicting 355,000 purchases in the first two days of availability, compared to an announced total of 270,000 from Apple a month after the iPhone launch. “We did our work and our work was wrong,” Munster said. Learning from that experience, he attempted to predict early sales for the iPhone 3G S when it was released last year — and undershot, predicting a half million sales in the first weekend. It took three days for the handset to sell one million units.
Despite these misses, and his reservations about the importance of early sales totals, Munster planned to produce numbers again next month when the iPad becomes available. “More data is better than less data,” he said.
For a company that is built on secrecy, I can’t believe Apple would allow sales numbers to be deduced simply from ordered numbers on receipts.