Video Gamestop Case

Words: 1025
Pages: 5
Open Document
When mentioning billion dollar industries, many automatically direct their train of thought to the airline, automobile, or movie industry. Few will consider the scale of the video gaming industry, regarding it as childish or mindless entertainment. Yet in 2013, the video game industry generated $21 billion alone in the United States (cox). GameStop (NYSE: GME) is one of the leading retailers in this ever-growing industry, thanks to its innovative marketing strategies and dedication to customer satisfaction. However with the rise in popularity of PC gaming and digital distribution, GameStop is now faced with new competition-one that deeply affects revenue and the success of the company. With over 711 million PC gamers in the world, I propose …show more content…
With the dawn of the digital age, the use for physical discs slowly declined as digital distribution rose. Figure 1 below illustrates how just in the past few years digital format has increased its footing in game sales. What was once a 20% stake in the market has
Figure 1 (Source:) now doubled in a matter of three years. Increasing at such an alarming rate, we can expect digital distribution to become the majority within the next 5 years. Distributing digital media is considerably cheaper because the costs associated with discs, production, distribution, and shelf space are now irrelevant. Gamers can download games and content directly to their PC from the comfort of their home. Easy access and convenience are the driving forces of digital distribution; why spend more purchasing a game at the store when the equivalent can be purchased online for cheaper?

GameStop’s identity is focused around its promise to deliver customer satisfaction through knowledgeable employees at their B&M locations. One could say the company is becoming myopic, too fixated on selling physical console games that they neglected to realize PC gaming is the future. Digital distribution has made its mark, with online and PC gaming increasing while console gaming is on a downward fall. Figure 2 below breaks down the multiple sectors of video games by …show more content…
You cannot resell a digital copy of a game, and used game sales account for a large portion of GameStop’s profit. Profit from new games is more reliant on high sales volume whereas used games generate more marginal profit. If GameStop shifts their efforts over to PC digital distribution, this could be problematic as they lose traction from used game sales. As a result, pursuing digital distribution seems counterintuitive if it affects their greatest revenue generator. To mitigate this revenue loss, I propose that GameStop create their own system of PC digital distribution. PC gaming is overtaking console gaming because of how affordable computers have become and the greater value they provide. It is time for GameStop to shift their efforts in order to please the
Show More

Related Documents: Video Gamestop Case

Essay on CIS HW 1

payrolls. Case Study 1 (GameStop) 1.) The five forces analysis of GameStop are as follows: Supplier Power: There is a very high supplier power as GameStop receives its games directly from the production companies. This trend will continue in the future as GameStop is one of the few retail outlets that receive their games directly from the suppliers. Barriers to Entry: There are very low barriers to entry within video retail industry. Starting a video game store, or store that sells video games as…

Words 844 - Pages 4

Gamestop Essay

After the acquisition of EB Games, GameStop rose as the leading video game retailer in its industry. In an effort to sustain their position, GameStop will have to tackle several technological and sociocultural issues that have arisen from its competitive environment. The strategic objective we wish to accomplish in this analysis is to formulate a viable strategy that will continue GameStop’s growth in the industry to remain as the go to video gaming store for the video gaming enthusiast. The retail…

Words 2411 - Pages 10

Entertainment Vs Video Games

changes in entertainment today is video games. There are now many forms to video games, virtual reality, consoles, PC gaming, simulators, and sports that are now controlled by body in the consumers very own living room. Video games have easily rivaled the video industry and also contribute to movie interests. Movies are being made after video games and games are being made after books, although the biggest and largest difference to the movie industry compared to video games is the after the point of…

Words 2553 - Pages 11

Thesis: Video Game and Child Essay

Dominic Hicks Professor Luanne Williams College Writing 10/13/2103 The Impact of Video Games Video games have been around for the last three decades. From its early years of Galaga and Mrs. Pacman at the arcade to Super Mario for Nintendo and Sonic the Hedgehog for the Dreamcast. Those historic games have been games have paved the way for the newer and more advanced video games that now surface the earth. Video games are no longer just in the arcades, but they have transitioned to being at-home…

Words 1893 - Pages 8

Brown And Trayvon Martin Case Study

Since then many accounts of police excessive use of force case have appeared in the media and in the court systems of various states. One case of excessive use force that is now circulating through the media is the case of Eric Garner vs NYPD, Garner was suspected of selling untaxed cigarettes. When a passerbyer recorded the confrontation between multiple officers and Garner, which basically…

Words 1687 - Pages 7

Best Buy Marketing Paper

Best Buy Inc. Best Buy Inc. has been performing business and providing customers with products and services in the United States for over forty-three years. From what started as an idea and a small music shop in St. Paul, Minnesota, Best Buy Inc. now operates over 1,500 "big box" retail stores around the U.S. They have constantly grown to become the largest specialty electronics retailer in the entire world. With ventures expanding into other countries such as China, Mexico, United Kingdom…

Words 6426 - Pages 26