Game’s Troubles: All Change For Retailers?
The recent troubles experienced by high street chain Game have been very public. They recently went into administration, and were bought by OpCapita, saving more than three thousand jobs. The question is, will this cause the company to reassess the way they go about their business?
There is no doubt that Game haven’t helped themselves, and are probably largely to blame for their recent problems. Of course, there are multiple reasons for their demise;
Online Retailers: With the advent of online retailers like play.com and amazon, who sell their games for at least £10 less than Game. Of course, they only have one premises to pay for, and therefore a lot less staff and overheads than Game retailers. The fact that they have been clever in their location, setting themselves up in Jersey, doesn’t help either.
Pricing/Stocking: Game tend to focus on only the big name titles, whereas you can find the lesser known games with the online retailers. Of course, Game only have limited shelf space, and therefore have to push the games that they know will sell. Unfortunately, this doesn’t help the smaller developers and publishers get their games noticed. Game also don’t seem to reduce prices too often, whereas the online retailers often have sales and offers if you don’t have to have the game on release day.
Digital Downloads: The rise of Steam and the emergence of OnLive are also making a dent in retail sales. In fact, most Game stores don’t stock many PC games now, as Steam offers such a reliable and fast download service. They have the pricing right, too, with digital games cheaper than boxed retail games, and sales that offer top titles at “impulse buy” prices. I myself downloaded Football Manager 2012 for £7.99 a few weeks ago, even though I was perfectly happy with last year’s version!
Supermarkets: With the huge buying power of the big supermarkets entering the videogame market, specialist stores like Game were always going to struggle to stay competitive. And when they offer a huge discount on the top games when you do your food shop, what chance does any other retailer have? They have already done huge damage to the clothing and music businesses on the high street, and it looks as though the game industry is now feeling the pinch created by the behemoth supermarkets.
Eliminating the Competition
Perhaps the biggest mistake Game made was buying their biggest competitor. In 2007, they purchased Gamestation from U.S. company Blockbuster for around £80million. This appears to have been the start of their downfall. Gamestation used to be a unique retailer, one that not only sold the big Triple A titles, but also had a good retro business too. Upon the takeover, Game said they would not change Gamestation. However, just a few months later, and the two businesses were carbon copies of each other. Gone were the retro games, replaced by just the current generation consoles and games. They also seemed to expand the preowned business, seemingly to the detriment of the company as a whole.
It turned out to be a monumental error. By buying Gamestation, they immediately doubled all their costs; rent, wages, purchasing and other overheads doubled overnight, but their profits didn’t follow suit. Why buy your competitor, and then make it a complete clone of your own business? Especially when there are branches of both stores in most high streets? There has been little sympathy for the company, but there has been for those that found themselves unemployed pretty much overnight.
Some good may come from this. Of course, a lot of people have lost their jobs through the closures, and that is unacceptable, but maybe this will cause Game to now readdress the way it conducts it’s business. And maybe, just maybe, we will start to see independent stores creep back onto our high streets, staffed by people who are passionate about games.
Maybe Game should take a leaf out of Waterstones’ book. The chain of booksellers has started to make the process of buying a book more of an experience. You can now buy a coffee, and sit and read the books before buying them, or ask the staff for advice. Staff who, by the way, are themselves avid readers and have their own specialist areas of expertise.
Would more people go into a branch of Game if they were a more welcoming place? A shop where you could go in, spend half an hour or an hour trying a game on any of the consoles out there, maybe grab a drink while doing so, and get some quality advice from staff who were themselves gamers? Would that even persuade customers to spend an extra tenner on the game compared to if they went to a soulless supermarket? I think it might tempt me.