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Interview: Best Buy VP Addresses Used Game Roll Out, Digital Expansion

Interview: Best Buy VP Addresses Used Game Roll Out, Digital Expansion

June 10, 2011 | By Kyle Orland




Best Buy senior VP of entertainment Chris Homeister said he's been pleased with the company's recent introduction of game trade-ins in 960 of its stores so far.

But as the company prepares to buy and sell used games at all American locations by this fall, he admits there is still work to be done to get consumers to think of the major electronics retailer as a place to go for trade-ins.

“We're just beginning,” Homeister said in an interview with Gamasutra at E3. “We've got work to do from a marketing standpoint for sure, but we're very pleased with the reception we're getting to our messaging. [How much] the average consumer knows that we're in these businesses, it's still low, no doubt about it. But though it's low right now, we're still seeing results that we like a lot.”

Starting this summer, a small army of 5,500 employees trained and dedicated to the gaming section of the store will be key to promoting the used game business, Homeister said. Those employees will man a new transactions desk dedicated to the gaming section, and help guide customers towards gaming trade-ins, pre-orders, and other promotions.

“It's a massive investment for us what we're doing from a people standpoint,” Homeister said. “We think it's the biggest thing that we're doing … having that educated person that thinks and breathes gaming every day, who can talk about the release schedule, ratings, their experiences, pre-owned inventory or whatever it might be, we're most excited about that.”

The gaming “blue shirts,” as the employees are called internally, will also be instrumental in helping Best Buy in its efforts to load-balance its used game inventories, shifting a title traded in at one location to another where it might be more likely to sell. Blue shirts can identify “what types of genres they are realizing success with on the pre-owned side,” Homeister said, letting the corporate office know if family or hardcore games need to be over-represented at that location, for instance.

Best Buy also hopes to juice used game sales with a new paid tier for its free Reward Zone Gamers Club program, which currently doubles reward points on gaming purchases for 2.3 million opted-in members. Starting this fall, customers will be able to spend $15 a year to earn a 10 percent bonus on any used game trade-ins, in addition to 10 percent off used game purchases and a subscription to the retailer's @Gamer magazine.

But despite all the attention being paid to promoting the used game business, Homeister said the company isn't going to rely on high margin used game sales to make up for what are traditionally small profit margins in the new game software and hardware.

“We look at the entire business, so no one sub-category is make-or-break for the gaming category,” he said. “We fully believe and expect and will want to see our share of new software increase as our trade-in business continues to increase. [Used] is an important part that essentially completes the cycle in the value chain of software, but is it the central lynchpin that we have to over-index to make money on? No, not at all.”

Outside of its stores, Best Buy also announced that the current line-up of 175 games available for download through its Best Buy PC app would double by the Fall. Homeister said games are by far the most popular type of software sold through the app, which comes pre-installed on a majority of the PCs the company sells. Employees are being trained to point out the app to new computer purchasers, Homeister said, rather than letting them discover it on their own when they get home.

Though Best Buy is cognizant of the changes digital delivery is bringing to the gaming market, Homeister said he doesn't see it as an existential threat to the brick-and-mortar games business. “I view them as largely complementary,” he said. “There's certainly those instances where it can be a bit cannibalistic, but our view is it's a bit of a different customer, it's a bit of a different experience they're looking to drive out from their perspective. When we look at those two businesses, I think they can both co-exist within our store well.”


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