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The Game Industry is Run by Morons

by David Trammell - June 16, 2008, 3:06 pm PDT
Total comments: 63

The first problem is that not all publishers offer price protection. You may be wondering, "What is price protection and why is it important anyway?" It means that if a retailer orders ten copies of Super Mario Galaxy and only sells five before Nintendo drops the price, Nintendo will credit the retailer money to account for the price cut. This is a good strategy because it encourages the retailer to stock a lot of copies so that customers can actually buy them. However, it is something of a risk to Nintendo because it means that they are responsible for every copy of Super Mario Galaxy on shelves rather than letting the game retailers be responsible. Of course, to minimize this risk, Nintendo only offers this protection to big chains (Wal-Mart, EB Games and so on). Further minimizing this risk is the fact that physical copies of games cost relatively little to manufacture (the money is mostly in the development time and marketing).

The really sad thing is that even with that protection in place, retailers still run out of a game quite easily. Even worse, that protection isn't always available since small publishers can't always afford it. But do game retailers really need this kind of protection? I mean, can't they shoulder a bit of the risk themselves to ensure that they actually have product to sell? And does it always have to be a risk? You would think that it would be pretty easy to predict that a minimal supply of the latest Castlevania game on the DS isn't going to cut it. Yet I recall having to drive quite far to pick-up Dawn of Sorrow when it was released (I'm lazy about pre-orders especially when I think they shouldn't be necessary). It's understandable for a retailer to unexpectedly run out of a game because it came from out of nowhere and earned a lot of incredible reviews, but it's completely unacceptable when the game has a numeral in its title.

Ah, but why do I worry so much? The game industry has a solution to this problem. They simply make us go into their stores twice for each game we want and make us pay for part of the game ahead of time. And we happily oblige them. Meanwhile a fan of books or movies can walk into their respective stores and buy their new releases with no fear of the store running out of copies and without placing a pre-order. In short, I've seen the faces of the morons running the game industry, and they look a lot like us. Want to do your part to end this stupidity? Stop pre-ordering games, and if GameStore runs out of their initial shipment before you get a copy, make a point to pick the game up from somewhere else. That'll show'em.

Why do I get the feeling that no one else is going to think this is a good idea?

Talkback

Aero LeviathanJune 16, 2008

Well, I for one agree completely. I have never pre-ordered a game from a brick-n-mortar, and I never will. It's ridiculous and I don't understand why people stand for it. (I sometimes pre-order when I'm buying online, but only because it costs me no additional effort, unlike having to go to GameStop twice.)

Tangentally related: I am so sick of having GameStop tell me the game 'isn't out until tomorrow', when the release date is today according to the publisher... and then I drive a few more miles to Best Buy and they have a dozen copies on the shelf.

RizeDavid Trammell, Staff AlumnusJune 16, 2008

*completely forgot about best buy*

*drives to best buy*

I've had this problem recently with Super Dodgeball Brawlers.
I haven't exactly gone crazy about getting this game as I haven't really had the money for it, but I had a good deal of money in giftcards to Best Buy and I wanted to pick up the game. So I went to the two Best Buys that are within 15-20 minutes of my house and checked to see if either one had the game the weekend after it came out. Neither one had it and when I asked, employees were convinced the game had not come or didn't exist.

I hate pre-ordering games and the only time I do it is usually the day before a game comes out at midnight. I did it with Super Smash Bros Brawl and, in all honesty, I didn't have to pre-order it but of course the employees give you the bull about "Well, if you don't pre-order the game, you won't get it."

NinGurl69 *hugglesJune 16, 2008

Spare me the anecdotal GameStoops stories.

My closest (next town) Best Buy ran out of Hot Fuzz and 300 Special Edition.  Screw the big blue store with the gigantic yellow tag.

"Well, if you don't pre-order the game, you won't get it."

The Wii has a healthy customer base in my neighborhood, so this aptly applies to me.  You happen to live amongst real/next-generation gamers who don't share your interests in kiddee mascot non-fighting-games.

I generally only preorder games when I'm already there picking up something else. Since that happens quite a bit I generally have preorders for most of the things I buy without making any extra trips. If I didn't preorder I have 4 GameStops, a Best Buy, a Circuit City, a Toys R Us, a Target, and a Wal Mart all within about a half mile radius not far from my house and usually  at least half of them will have any one game in stock.

animecyberratJune 16, 2008

I have canceled every pre-order I have ever made and bought the game at Target for a lot less a month after said game as come out. I only pre-order a game if it comes with a free gift, but like I said, I get the gift, cancel the pre-order just before and pick the game up at another store.


But I have seen this happen to movies a lot more than it should have. Just 2 weeks ago when my aunt was staying with us we went to see Indiana Jones in the theater. This sparked interest in my parents to watch National Treasure with my aunt who had never seen it and thought it was a similar type of movie. We hit every single store in town and not 1 had a copy of the stupid movie.

Shift KeyJune 16, 2008

Quote from: Rize

In short, I've seen the faces of the morons running the game industry, and they look a lot like us. 

No horns? No powerful sulfur odour? No tail?

RizeDavid Trammell, Staff AlumnusJune 16, 2008

Well, once a game (or movie or book) is rather old or if it has no buzz about it whatsoever, we can't blame vendors for not stocking it.  But failing to have a reasonable supply of the latest Castlevania game during the week it's released (for example) is the moronicity I speak of.

animecyberratJune 16, 2008

where the hell did all that come from? Man I was tired yesterday. I forgot what I wanted to say now but it was not all that garbage.

DjunknownJune 16, 2008

Quote:

I mean, can't they shoulder a bit of the risk themselves to ensure that they actually have product to sell?

With Gamestop/EB making record profits for the last few quarters, I'm sure they could do a lot things such as price protection. They could do a lot things actually, but that's another story...

PlugabugzJune 17, 2008

Quote from: Rize

http://www.nintendoworldreport.com/blogArt.cfm?artid=16169

 


They simply make us go into their stores twice for each game we want and make us pay for part of the game ahead of time.

Here we don't pay for pre-orders. Only with hardware a £10-£30 deposit goes down which counts towards the cost of the item anyway.

KDR_11kJune 17, 2008

Morons, first of which is NoE. Well, okay, at least there's plenty of stock of the three games they want us to buy at 90$ a piece long after everyone else can get it for 20.

Know what? I just opened the NoE website, apparently they give you 50 bonus stars (worth about 12.5 wii points) if you register your intent to buy a specific game on release day with them. Guess they read your article and wanted a piece of the action.

We do have a store that tends to run out of games. It's not Gamestop. It runs out because it's almost always cheaper than the competition and has games on Thursday instead of Friday.

D_AverageJune 17, 2008

I only pre order if I'm promised a free sticker or something, I mean, who doesn't want stickers?

Nick DiMolaNick DiMola, Staff AlumnusJune 17, 2008

Quote from: D_Average

I only pre order if I'm promised a free sticker or something, I mean, who doesn't want stickers?

I find that to be true of myself as well. Well, not necessarily a sticker, but any free swag they are willing to give me in exchange for an early $5. Preordering is crap otherwise. I can't think of a single game ever that I couldn't find somewhere on launch day with enough patience. Even if I couldn't find it on launch day, I would just wait because to be quite honest, I have enough other games to play in the meantime.

RizeDavid Trammell, Staff AlumnusJune 17, 2008

I hadn't considered the experience in non American locations.  Of course, each culture has it's own ways when it comes to the video game business (which just goes to show you that the companies over here have not stumbled upon some secret formula for greatness; it's just a bunch of random crap that's different everywhere you go).

redgiementalJune 17, 2008

Personally I usually only seem to have trouble buying new Wii games and generally not other systems in brick and mortar stores. I don't know wether to blame NOE or maybe its just that Wii has been phenomenally popular. I'm inclined to blame NOE though it seems to happen just a bit too often.

I generally buy games online anyway but sometimes if you have nothing to do on a lazy saturaday and some cash I may buy something the old fashioned way.

I hate GameStop with a passion. The clerks are idiots, they're unaware of what games come out when, they overcharge ($24 for MP2? Really?), and very very often, they simply don't have the games I want. I don't dare divulge how many times I've called them, asking if they had something, hearing that they did, running down there right away, and finding out that no, actually, they DON'T.

So I've stopped supporting the company entirely. The one time I pre-ordered a game from them was online. It was Portrait of Ruin, because I wanted all the awesome bonus swag. And I got it. And it was awesome. But Secret Agent Clank comes with a Clank figure (pre-order only) but I just don't care anymore. I didn't even flinch when they offered that kick-ass bonus stuff for MGS4. I'll just find it somewhere else later.

Best Buy is pretty much my gold standard now, but up here in Alaska it's tough to get games on the release date sometimes. Unless it's an uber-popular title (like MGS4), our stores don't get games for a few days after it's announced in the paper ad.

RizeDavid Trammell, Staff AlumnusJune 17, 2008

Yes I generally don't give a damn about special editions these days, but the PoR bonus was too good to pass up.

vuduJune 17, 2008

I'm in the same boat with the PoR preorder bonus.  Unfortunately, I'm so OC I haven't even opened it up for fear of ... I don't know.  I wonder if it's worth anything.

Dude, just open it. It's a CD and an art book. And there's a little DS card case that's perfect for travel.

RizeDavid Trammell, Staff AlumnusJune 17, 2008

castlevania is way to popular for that to ever be worth anything because a bunch of people are doing the same thing you're doing (and would you sell it anyway?)  might as well open it and enjoy the art book.

what if it was worth 200 bucks 10 years from now?  it's not going to change your life.

vuduJune 17, 2008

It's not that I expect it to be worth anything.  It's just that I really don't need any more "stuff".  So I keep it locked up so as not to clutter up my place.  I downloaded the art book and time line when it first came out, and don't really have much interest in the soundtrack.

TheFleeceJune 17, 2008

I live in New York where mom and pop game shops are very far and in between. I have the advantage of being around the Nintendo Store so if they do an event for a title I like I will go a head and preorder, but I've only done it through them. Every other game store can suck it, the way they treat customers in general is bad.
When No More Heroes came out I had to walk through most of Manhattan, hit up about 5 stores and finally got mine after all the  chains told me I had to preorder it- and the Nintendo Store didn't even stock it the day it came out.
If I don't preorder a title that I want and I can't get it. I bite the bullet, wait and then act when the world's got their back turned. That's how I got Wii Fit :P

SheckyJune 17, 2008

You should have tried to buy Worms 2 for the DS.  Not even the Best Buys stocked that game.  EB got *1* and is the only proof I had of any brick-n-mortar store having any stock of the title.  Had to buy it online at Walmart.com (well that was the cheapest choice with in store delivery available).

I can't find a copy of Mario Kart Wii now that I want one. Awesome.

PlugabugzJune 18, 2008

What's stopping people from buying from places like Amazon?

KDR_11kJune 18, 2008

I think a part of this may be that the profit margins on new games are tiny and not worth it, the games are mostly a customer bait to get people into the store, if the game is sold out it still serves that purpose (might even be better that way as the costs for dealing with the game are no longer there). Of course being known for having games in stock might amplify the effect but then you risk ending up with unsold copies that can be a huge financial drain, not just because of price drops but also because of the things simply not selling, in my experience console games just rot on the shelves until the store decides to bite the sour apple and discount the game themselves to cut their losses.

IOW, actually selling games is not useful to stores so they don't really care if people can buy them.

RizeDavid Trammell, Staff AlumnusJune 18, 2008

That's what price protection is for.  I'm fairly certain the big 3 offer it to all major retailers (I think Sony and maybe MS even offer it to small stores).

KDR_11kJune 18, 2008

Is that on returns of unsold merchandise too?

RizeDavid Trammell, Staff AlumnusJune 18, 2008

yes, new unopened unsold merchandise.  I don't know if they will allow an out and out return, but if Nintendo ordinarily sells Metroid Prime 3 to a retailer for 40 dollars (and the retailer sells it for 50) and Nintendo says, we're cutting the price to 30 (and you sell it for 40), then Nintendo will give the merchant 10 bucks per copy.  Or something along those lines.

vuduJune 18, 2008

Actually, I think more manufacturers protect margin, not profit.  So (using Rize's example) since the retailer originally had a 20% margin, Nintendo would give the merchant $8 for each unsold copy (making their cost effectively $32/unit) to maintain that margin.

Quote from: Plugabugz

What's stopping people from buying from places like Amazon?

In theory, nothing. That's where I went when I couldn't find a copy in a store. But guess what, it's only available through 3rd party vendors STARTING AT $65!

Shift KeyJune 18, 2008

Quote from: TheYoungerPlumber

But guess what, it's only available through 3rd party vendors STARTING AT $65!

Hahaha, I paid $70 for MKWii and I got it before you. Take that, America-town!

KDR_11kJune 19, 2008

Oh and speaking of morons, what about the great idea of releasing everything for Christmas and then wondering why it's not selling?

RizeDavid Trammell, Staff AlumnusJune 19, 2008

seriously good point, however, the industry is slowly moving away from that.  While we have a glut around Christmas, there are a lot of good games during the rest of the year too (GTA IV was just released; frequently games that miss their fall release dates end up as spring releases)

vuduJune 19, 2008

This sounds like the topic of another blog entry.  ;)

I don't understand the existence or appeal of game-specific stores in this day and age.  Virtually all new releases are carried by general retailers like Walmart, Target, etc. as well as general electronics stores like Best Buy and Circuit City.  What is the advantage of buying a game in a game-specific store?  It usually costs more, and you get harassed by the employees who are trying to sell you a bunch of other stuff you don't want.

The ONLY reason I go into Gamestop is to trade in crappy review copies after finishing them, and to spend the credit I get for doing so.

We've got a local version of GameStop called Microplay. I have to give them lots of credit. They usually give more in-store credit than GameStop would, the people there are REAL PEOPLE with knowledge of gaming, and their prices aren't ridiculous.

The drawback is that, being local, Microplay usually has to go through different vendors than chain stores, so there are times where release dates aren't met. They simply don't do pre-orders (and I applaud that). You can choose to put your name on a list and they call when the game comes in, but it's not reserved for you.

TheFleeceJune 19, 2008

The game specific stores don't serve much purpose, I make it my business to avoid them at all costs. There are very few legit game shops that aren't chains anywhere, that's a bit of a problem because game shops that have integrity usually have to jack their prices up to stay in business.
The biggest reason that stops me from going to Amazon is that I'm a spoiled big city guy and paying for shipping.

Most orders on Amazon qualify for free shipping, if you don't mind waiting a week to get your stuff.

UncleBobRichard Cook, Guest ContributorJune 19, 2008

Quote from: Jonnyboy117

What is the advantage of buying a game in a game-specific store?

When game stores carried lots of older games (NES, SNES, etc..), that was always a good reason to go in 'em.

As for Price Protection - that's not the reason why stores have plenty of copies of movies/books - it's because they can flat out return copies that don't sell.
No store is going to order hundreds of copies of a game that they may not sell, even if Nintendo offers to give them some cash back on unsold copies - they simply don't want to set on a large amount of inventory any longer than they have to...

You know those giant half-pallet displayers you see in Wal*Mart on release day?  We sell five copies, then ship the rest back.  If we were stuck setting on those movies for more than two weeks or so, you can bet we wouldn't get as many in.

And then, those movies companies simply resell those same movies when some occasional re-orders come in, or via their own DVD music clubs or whatnot. Great secondary markets for movies to be sold in. If only videogames had a secondary market or some way to leverage old stock like that.

NinGurl69 *hugglesJune 19, 2008

I ordered $140 worth of DVDs last night.  Saved $35.

Deepdiscount's summer SUPERSALE is almost over.

KDR_11kJune 20, 2008

With the money Pro can potentially save from that SUPERSALE he could buy a button that makes it snow on the beach!

UncleBobRichard Cook, Guest ContributorJune 20, 2008

Quote from: Kairon

And then, those movies companies simply resell those same movies when some occasional re-orders come in, or via their own DVD music clubs or whatnot. Great secondary markets for movies to be sold in. If only videogames had a secondary market or some way to leverage old stock like that.

Or they come back a few months later in our $5 dump bin...

Anywhoo, with paperback books, most retailers tear the cover off, send it back for credit and destroy the rest of the book (recycle!).  There's no real secondary market for paperback books - although some paperback books *are* the secondary market.

Same with movies.  Most "new release" DVDs are the secondary market (theatrical release being the primary).

Ideally, if you know your game is good and it's going to sell (or it should sell), there's no reason not to offer to buy back unsold copies (Zack and Wiki would have been a good game to do this with... Giant half-pallets displaying the game at Wal*Mart would have sold more copies.  How about Boom Blocks?).  If you know your game is trash (Dogz, etc...) then yeah, it makes sense not to offer to buy back unsold copies.

The idea of "we want you (retailers) to buy our games - no matter how crappy we make them - and you get to shoulder all the risks" is half the reason the distribution of games is so screwed up right now.

NinGurl69 *hugglesJune 20, 2008

I buy my games where and when it makes sense to.

RizeDavid Trammell, Staff AlumnusJune 20, 2008

Tycho from today's PA news post:

"Etrian Odyssey II is exactly what I want to play right now, and it's sold out virtually everywhere I go."

In case anyone didn't figure it out.  EOII is the game that inspired this post, although Castlevania Dawn of Sorrow is what fueled it (it's just barely understandable that an Atlus title would be understocked).

Atlus only makes 78 copies of each of their games for each region. I don't like places saying you need to preorder a game to get it but you're a fool to not preorder an Atlus game.

NinGurl69 *hugglesJune 20, 2008

har har.

RizeDavid Trammell, Staff AlumnusJune 20, 2008

That's somewhat true, but in this case I was right to predict that supply is plentiful... if you don't mind waiting for it to get back into stores.

ATimsonJune 21, 2008

Quote from: Jonnyboy117

I don't understand the existence or appeal of game-specific stores in this day and age.  Virtually all new releases are carried by general retailers like Walmart, Target, etc. as well as general electronics stores like Best Buy and Circuit City.  What is the advantage of buying a game in a game-specific store?

Game-specific stores are generally the only place to find the collectors editions of games, so if you're interested in those (I usually pick up the CEs for anything Blizzard puts out, and for Guild Wars), you pretty much have to go and preorder them at a game-specific store.

Otherwise, though, I'm more than happy to shop elsewhere.

KDR_11kJune 21, 2008

They have collector's editions in department stores here...

NinGurl69 *hugglesJune 21, 2008

I guess the reality is that the Yanks have more game-centric stores to make your department stores look like the niche stores.

KDR_11kJune 23, 2008

Probably, can't imagine how else Gamestop survives with having a worse selection and worse prices than every other store out there.

NinGurl69 *hugglesJune 23, 2008

The GameStops I visit typically have 2x the selection of the department stores.  It's more complete in that they're less likely to rid stock of older, non-selling games like launch games sooner.  They're also spot-on with receiving game shipments on the street dates.

The Wal-Marts and Targets around here miss 3rd-party game street dates by at least a week.  They also do weird things like split the Wii stock into 2 shelves, one that's adjacent to the 360 and PS3 shelves but contains the high-selling kid-friendly games, while the other shelf is on the other side of the wall (different aisle now), next to the DS games and has the Teen+ games I guess they don't want to sell.

KDR_11kJune 25, 2008

Walmart is a hypermarket, not a department store and despite that being defined as a cross between a supermarket and a department store they have abysmal game selections. It's the same for all hypermarkets. Target is counted as a department store but the pictures on Wikipedia kinda make me question that. One department store here has a stupid separation where Nintendo consoles go into the kids section while the PS2/3 and XBox stuff goes next to the PC games but their prices are so ridiculous they can be ignored altogether. The other big department store chain has fairly large game sections, the electronics retailers obviously have large ones too. A GameStop may have more if you count used games too but they tend to stock fewer copies of each game...

vuduJune 25, 2008

Is hypermarket an actual term, or did you just invent it?  We typically call them "mass merchants" here in the states.

UltimatePartyBearJune 25, 2008

I've never heard of a mass merchant.  I've heard of a Hypermart, but I think they're all closed now.  Anyway, in my experience Target and WalMart have the best game selections in general, followed by Gamestop, then Circuit City and Best Buy.  That all varies depending on what platform's games you're looking for.

When I think of a department store, I think of Sears.  They have a terrible game selection, although that is where I found my Wii.  They typically only sell games to grandparents, I guess.

CalibanJune 25, 2008

Quote from: vudu

Is hypermarket an actual term, or did you just invent it?

It's common in Europe.

My GameStop has significantly more Wii games and even more of a lead in DS games than any Wal Mart or Target around here. Best Buy usually has about as good a selection as GameStop.

How does the term "big-box" retailer apply then?

KDR_11kJune 26, 2008

Hypermarket is basically an upscaled supermarket (technically the definition is that it's a cross between a supermarket and a departmet store), things like Walmart Supercenter, Carrefour Hypermarché, Real, ... Big-Box seems to be a synonym for that.

animecyberratJune 26, 2008

Not all Wal-Marts are Super Centers though. I've been to plenty that weren't. Target here is a lot better than the closest Wal-Mart here and they both have a decent selection on par with GameStop. OUr best stores here in Twin Falls for video games are Shop-Ko (in the mall) and Fred Meyer (which *was* the mall before the built a new mall so it's pretty friggin huge.) Best Buy usually has a good selection also but I rarely go into Best Buy.

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