Gateway tries trade-ins to boost sales

In its latest attempt to woo PC buyers and stave off a revenue crunch, Gateway is offering a trade-in program for the holidays.

The direct seller of PCs will give up to $100 toward future purchases to consumers who trade in their old PCs and peripherals when purchasing a new Gateway desktop or notebook.

The trade-in program is the latest in a series of promotions--including a buy one, get one free PC offer--that Gateway has launched in recent days to boost sales through the end of the quarter. The company is also currently offering free shipping and handling on all of its desktops and some notebooks in the United States.

While some PC makers were satisfied with sales during the Thanksgiving weekend, Gateway CEO Ted Waitt told attendees at a conference on Dec. 4 that unless sales improved soon, the company might be forced to cut its fourth-quarter outlook. Since Waitt's speech, Gateway has unloaded a barrage of incentives to spark sales.

Driving all the deals is Gateway's plan to return to profitability. The company, which launched the new, more aggressive strategy after its disastrous fourth-quarter performance last year, aims to increase its unit sales volume in order to reap profits again.

Trade-in deals are popular among retailers such as CompUSA, which at times this year has offered consumers the ability to trade in their old Windows-based PCs to receive credits of $100 to $200 toward the purchase of new PCs. That is slightly different from Gateway's deal of giving credit toward future purchases.

Gateway, which is already offering aggressively low prices on its PCs, also launched the buy-one-get-one-free PC offer over the weekend.

That program gives customers who buy a certain Gateway 700XL desktop or 600XL notebook model a free Gateway 300S desktop. But it's not for everyone: The 700XL model costs $3,499, while the notebook sells for $2,399.

Gateway's 300S PC is itself an aggressive desktop, packing a 2GHz Intel Celeron chip and a CD burner for $399 without a monitor. It can also be purchased with a 15-inch flat panel for $699. Both prices include a $100 rebate.