Wednesday, December 10, 2008

Retail Unplaying: How Games Sell and Trade at Game Stores- Xbox 360 Part 2

Went to GameStop today and saw this:


Here's an example of what the previous post was about. When this post was published, Prince of Persia released one week ago. There are already two used copies on the wall with "a few more" behind the counter. They were on hold for employees that were going to buy them. So at least four copies (if not more) of Prince of Persia were traded in within the game's first week on shelves. I could not get any more info on what customers purchased with the $25 trade-in credit that Prince was worth or if the customer took the $20 cash (GameStop rules state that if you get cash for your trade-in, it's 20% less than the value of store credit).

The question is "What happens to Ubisoft?" Well every used copy sold here, including the employee copies, are lost sales. If the four copies sell, Ubisoft lost $240 in sales from one game store in one week: it's all-important launch week. Again, one game store.

GameStop's website states the retail chain has over 4,400 stores. So if the trend was like the store I visited, that means 17,600 copies of Prince of Persia were traded in. If those copies sell, that's a projected $1,056,000 loss on Ubisoft. All the talented programmers, artists, designers, leads, QA testers and everyone else at Ubisoft lose that money and in the end, hurt their business and projective sales that the game deserves.

Now this is not an attack on GameStop, though publishers should do something to combat trade-ins and used sales. Ubisoft is one of the few publishers that actually tries too. If you preorder games like Prince of Persia or Far Cry 2 at GameStop, you automatically upgrade to a limited edition for free. This is smart on Ubisoft's part: Keep your friends (customers) close and enemies (used retailers) closer. GameStop gets preorders ,which are good on their part, and Ubisoft gets as many customers for new copies as possible.

GameStop, or any other used game retailer, can argue too (and make a good point). Some customers preordered and bought new copies of Prince of Persia by sacrificing their games, therefore CREATING sales from trade-ins. For example, let's say four customers bought Prince of Persia with combination of trades and some cash. These four people couldn't afford it without trading in those games. That's 17,600 more copies sold, resulting in Ubisoft gaining $1,056,000. Breaks even huh?

Publishers should take retailers like GameStop or Game Crazy seriously. They need to take action to make them their greatest ally, with promotions like free upgrades or preorder bonuses. While at the same time, making sure they don't benefit too much off themselves.

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