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GameStop to game devs: Please love us

GameStop to game devs: Please love us Exclusive

August 6, 2012 | By Colin Campbell

August 6, 2012 | By Colin Campbell
More: Console/PC, Business/Marketing, Exclusive

In the last decade, there have been very few occasions when I have been able to get a GameStop executive on the phone, talking to me about the retailer's operations. This is a company that usually speaks through anodyne press releases and investor notes.

So here I am sitting in the company's carpeted business suite in Grapevine, TX, sipping on a latte and chatting to the CEO, the company president and various other friendly, charming departmental heads. This is what is known as a Big PR Push. There is even a party, with beer and enchiladas. Experience tells me that, at some point, a goodie bag will be making an appearance.

The point of all this is that GameStop now seems to realize that it cannot forever rely on all those gazillion locations in retail strips and malls for its brand presence; that it cannot live forever on taking out glossy inserts in local newspapers; that it must move on from the tried and tested techniques of badgering every stray browsing consumer into becoming a premium club member, and then blasting them with emails.

This is GameStop angling itself as an organic part of the games industry, rather than as merely an adjunct, a service provider. It is GameStop, donning the white cowboy hat, a sartorial must in these parts, seeking to become a good guy in the eyes of the biz. Convincing people who make games that GameStop is good for them -- these days, this matters to GameStop.

It's Not Easy to Love

I've tended to think of the used games business as a piece of commercial opportunism that sucks income away from the good people who make games, and towards people who make games move from A to B in trucks and makes 20-year-olds stick them on shelves in boxy retail outlets and makes a lot of money doing these prosaic things. For someone who thinks that creativity ought to be rewarded, it's not easy to love this company.

But perhaps this is snobbery. Consumers have a right to trade their goods in, and GameStop does a good job of facilitating that right. While I'm visiting the company I get the full tour of the company's facilities plant, where old games and old consoles are cleaned up and made ready for resale. It's an impressively efficient operation.

If all this sticks in the craw of game-makers, well, that's just too bad, unless of course they are kicking Toyota a slice whenever they trade in that old car, which I doubt.

GameStop takes a more reasonable tack in negotiating this emotional minefield. Company president Paul Raines draws the stats from his holster, saying that 70 percent of income that gets handed over to consumers for traded goods is immediately spent on new games. That's a $1.8 billion injection into the games industry.

Many of us, at some point, have turned up at a GameStop outlet with the express purpose of buying a new game for as little cash as possible, via our old games. It's part of the business.

Raines says, "We are not ashamed of the pre-owned business and in fact we believe that it's good for the industry."

This is a line the company has long taken, most usually for the benefit of its direct partners, the publishers. But it's the development community who are usually most aggrieved by used games, and these development professionals are becoming more powerful and more influential as they build up loyal armies of friends and followers on social networks.

Raines says, "The knowledge of how this model helps drive sales really resides at the publisher level. We have not been successful in communicating to developers how this business really helps. Now, if I'm a developer, I know that [used games] give me heartburn, to see a game..." He tails off, aware perhaps that saying the words 'to see a game I poured my heart and soul into selling at close to retail prices without yielding up a cent in royalties.'

This is something else that the retailer is keen to talk about. We have all been into a GameStop store and been offered a new release, used, sold at $5 lower than the new price. The company insists this is a tiny percentage of its business and, in reality, happens rarely. People generally hang on to new games for at least six weeks, the execs say.

Raines regroups: "...We're really not cannibalizing new game sales. That's a common misconception. So my answer to developers is that we are driving growth in a category that needs to grow. We think there's a real lack of awareness as far as how it's good for the industry. The transparency you're seeing from us is because we want people to know about it, helping people understand what we're trying to do for the industry."

Marginal Purchases

Whenever I've written about the used games business for my employer IGN, I've found vociferous and passionate opinions from consumers, almost entirely in support. They see this stuff as currency and they see it as their way of affording new games and, via the used game racks, sampling games that they might otherwise see as marginal purchases.

Raines says, "A lot of our consumers tell us that the pre-owned business has allowed them to learn more about video gaming. There's a disconnect between a lot of the blogosphere and what consumers tell us."

This is an interesting aside, the idea, often heard, that what Twitter and Reddit has to say about a brand isn't always the way people who park their cars and wander malls and buy giant pretzels actually feel.

GameStop talks up its "net promoter score," a qualitative brand ranking that scores based on negative and positive feedback.

Company CEO Tony Bartel says, "Our customer base, the people buying from us, typically rate us at about an 85, which is up around the Harley-Davidsons and Neiman Marcuses of the world."

He adds, "There are a lot of people on the internet who are going to say some negative things about us from time to time. It's going to get picked up. There are a lot of people [on the internet] who tend to be very developer-centric, they love the developers. Anyone who is perceived as doing anything whatsoever to detract from the developer is going to catch some vitriol from the [internet] folks."

So GameStop is on a charm offensive, and the target is the kind of people who read Gamasutra, that being game developers and snarky/smart internet commentators.

For Raines, it's important to be accepted as part of the game industry family, rather than as some parasite. He targets those other retailers as the ones who don't give a rat's ass about the games industry, and, on this, he's not wrong.

"We don't sell appliances," he says. "We don't sell groceries. We are all about gaming. I play four hours of video games a week. Our office is filled with gamers and people who are into video games. We are authentically into gaming. This isn't a company that dabbles in it. Yeah, we have a business model, we have to make profits, but we're really into video gaming."

He makes one last point about the used games business, one that many of us who earn an actual salary tend to forget. "The pre-owned business is not going to go away overnight. No matter what happens, there will be people who want a $9.99 Madden 07. They don't have $59 to pay for the new game. We've got a ton of customers still playing PS2 games. I mean, where do you buy PS2 games anymore except GameStop? There's a consumer for that."

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