Rival retailers say they are ready to step up as the credit crisis at GAME Group deepens.
But these competitors are not celebrating, with leading outlets fearful of what the loss of their ‘gold-standard market leader’ will mean for the future of UK games retail.
Retailers such as ShopTo have ramped up their PR and marketing efforts to win customers during a situation that has seen big games – such as Mass Effect 3 – not appear on GAME shelves.
We’ve seen a dramatic increase in our market share in the past week and started an extensive TV and Underground marketing campaign around titles unavailable from GAME stores,” said ShopTo chief Igor Cipolletta.
Although we are extremely pleased about the jump in market share, and the ability to dispatch over 2m worth of games last week, we are extremely concerned about the effects the GAME situation will have in the long term for the games industry.”
John Lewis’ games buyer Robert Hennessy added: With the shift to online of both physical product and download, and the price-led competition in the sector, it’s no surprise profitability is becoming an issue, and that retailers are struggling to pay the bills.
Long term the format holders and software producers need to find ways of driving value back into the category, to protect its long term viability, if they want to retain retail support.
The John Lewis business model has good High street stores allied with a strong online business, and could help fill any potential gap in the market as long as the commercials work.”
EA CEO John Riccitiello said last week that GAME’s rivals will absorb that business”. And that has certainly appeared to be the case, with Mass Effect 3 beating the previous two titles in the series last week, despite not being stocked by GAME Group.
GAME could still survive. The Group is currently attracting OpCapita, Wal-Mart and GameStop. Although it is likely the retailer will look very differently if an acquisition does materialise.
We launched Mass Effect 3 at a competitive price at midnight before the majority of retailers, and we have seen great sales as a result,” said Asda’s head of games Andrew Thompson.
We will continue to make sure Asda is the top destination for enthusiasts for future releases.”
HMV communications head Gennaro Castaldo added: We are working hard on our own advertising, PR and promotional activities, including specially-built product zones on hmv.com, to send a positive message out to consumers so they know we have these titles in stock, and to highlight special deals we may be offering.”
Gerry Butler, Blockbuster’s Europe SVP and commercial director for UK, said: The challenges that the video games market faces are a reminder to us all we have to keep working with publisher partners to deliver content in the way gamers want, at a price they’re prepared to pay.”
The Hut Group – which owns Zavvi.com – also says it is driving forwards despite the concerns about the market. "Our focus remains on our customers and partners, and this dedication will continue. Zavvi.com has strived to build relationships with both our customers and key suppliers to ensure the best possible experience, service and product," said head of business development Sarah Jasper.