Is the age of discounts over?

[rgard]

It's not just that. Everytime we have an informal discussion - or even a POLL on ENWorld, the responses to "how old were you when you first started gaming" bring in a very consistent bias of answers that indicate early to mid-teen years as the largest block of answers by far.

The data to that simple answer tells the tale and it has longterm consequences for the hobby.

That's not to say some didn't start younger; nor is it to say some didn't start older. They did and they do. But the lion's share of responses was from people still in school. And that age group is your target market for new players to the hobby.

And kids that age don't have credit cards. They are shut out as customers from online sales unless they can persuade sombody else to buy it for them with a credit card.

That is a HUGE barrier to entry into this hobby.

Yep, only the grown-ups used plastic at my store. The kids (90% of the people new to the hobby) all paid cash.

Thanks,
Rich

 

[Steel_Wind]

Yep, only the grown-ups used plastic at my store. The kids (90% of the people new to the hobby) all paid cash.

Thanks,
Rich

If you go into an EB Gamestore and ask them what is their most consistent selling PC Games product over the last year, I 100% guarantee you that the answer is the World of Warcraft Time card.

The reason those stores stock that product and sell so many is because of players without credit cards. That matters to that target age group (and to others who are older and have bad credit - another 20% of your customer base).

You can't shut out that much of your target customer base and survive over the longterm. You just can't.

 

[rgard]

Yep, only the grown-ups used plastic at my store. The kids (90% of the people new to the hobby) all paid cash.

Thanks,
Rich

I should define 'kids'...anybody 12 to 18. I'm 46 so I can call the 18 y/olds 'kids.' Could stretch that to 21, but would have trouble defining my best store-grown DM (he was 20 when he started a regular game at my store) as a kid. Mature for his age.

Thanks,
Rich

 

[Twowolves]

I can't figure out not only the FLGS anti-love, but the complaints of a 20-30 minute drive to get to one. That's a problem? I grew up in a small town, where the nearest mall was an hour away, and the nearest good game store was 2 hours away, and we managed just fine. Not only did we not cry about it, we had fun and made a day trip out of it! Carload of gamers, excitedly talking about our hobby, pouring over the never-before-seen (and often, never-before-heard-of) product, buying a couple armloads, and reading over them/discussing them on the way home. It was a blast!

Even now, I have a 2 hour round trip commute to work, so going 20-30 minutes away to browse games is nothing.

As for the role that FLGS's have on the hobby, I'll trust the industry guys who put in market research, because their livelihood depends on knowing these things. I'm guessing their data kinda trumps ENworld polls and empirical observations by posters here.

 

[Thornir Alekeg]

I don't believe for a moment that this ruling will change one thing about buying gaming goods. If large retailers like Amazon are gaining competetive advantage by negotiating a lower wholesale cost from publishers/distributors, then nothing will change. The publisher/distributor already has the power to not sell to these large retailers at a lower price, they choose not to because of the power these retailers have. The publisher setting a minimum retail price will not prevent the retailers from continuing to negotiate a lower wholesale price (and thereby increasing the profits of the retailer).

If large retailers gain their competetive advantage from lower overhead, rather than a lower negotiated wholesale price, and thereby can offer lower prices than places like the FLGS, a minimum retail price will not actually affect the large retailers and help the FLGS. The FLGS will not make any more money than they did before off a single sale.

While Dancey believes that the level playing field on the price of an item will move some portion of the market share from Amazon or other large retailers back to the FLGS, I do not agree. The reason? Amazon will make more profit on the sale of that same single item, and in order to maintain a competetive advantage they will offer other incentives to consumers. Maybe free shipping will no longer be a $25 minimum order and slower than standard shipping. Maybe they will offer discount coupons - Borders and B&N do this now - "$5 off a purchase of $25 of gaming supplies" or "earn a $5 gift certificate for every $50 in gaming pruchases". Coupons do not change the minimum sale price of an item, so as long as they are not targeted to a specific item, this ruling will not prevent the large retailers from offering them. The FLGS still will not be able to compete on price.

 

[JustinA]

In other words, any producer stupid enough to do this is almost too stupid to deal with anyway, and has probably got a history of thunderous stupidity.

Yeah. I doubt this will have any effect on the mainstream booksellers because mainstream publishers aren't insane.

But there is a virulent strain of insanity in the RPG industry where the following logic is used:

(1) Brick-and-mortar game stores can't compete with the big discounters.

(2) Brick-and-mortar stores are the life's blood of the RPG industry. (Usually the logic employed here is something along the lines of "only the brick-and-mortar stores grow the hobby by running demo games and the like".)

(3) Therefore, places that sell RPGs at a discount are killing the hobby.

For example here's a thread at RPGNet where a West End Games' rep makes the argument.

There are many big, glaring assumptions in this argument:

(a) That brick-and-mortar stores actually play a significant role in growing the hobby.

(b) That brick-and-mortar stores are incapable of competing in a free market.

(c) That cheaper game manuals (and a lower introductory cost) aren't as effective or more effective at encouraging people to give the hobby a try.

(d) That brick-and-mortar stores should be responsible for the demos and other activities which grow the industry.

What do I think would actually grow the hobby? WotC organizing Game Days featuring demos and free pamphlet-size Starter Rules. And not organizing these at game stores, but at Barnes & Nobles, Borders, and other mainstream venues. (Other publishers could also be trying to do this, although their efforts would almost certainly be on a smaller scale. And there's a limited number of publishers who could do it, because there are a limited number of publishers actually selling at mainstream locations.)

And, frankly, I'm fairly convinced that the #1 killer of the LGS is... themselves.

I may simply be blessed, but I've yet to see a well-run game store go out of business. I've seen game stores go out of business, yes. But they have been the poorly run game stores: The places that can't manage their inventory. The places that lack decent customer service. The places that are filthy and unwelcoming.

Here's the other thing, folks: This ruling is not unimitigated good news for the FLGS. Retailers survive by discounting dead stock in order to free up the investment they made in it. (If your local game store has a ton of ancient, crappy game supplements marked at full price, there's a fairly good chance that your local game store doesn't know what it's doing. There are exceptions -- for example, THE SOURCE in St. Paul, MN has an extensive stock of older games and packages this as a feature. But if your FLGS has a bunch of capital tied up in products that haven't sold and are never going to sell, then your FLGS is not being run well.) Your FLGS will now be prevented from doing this.

Technically an item is worth what someone else is willing to pay for it. But to be honest, I probably would not have bought some of my books if I had to pay that "Suggested" price. Some have said that the Suggested Retail Price is purposely inflated to account for discounters, but I doubt it will be reduced any time soon.

I can virtually guarantee it. The publishers are still going to be selling to the distributors at the same discount and the distributors are still going to be selling to the vendors/stores at the same discount. The only flexibility that has been lost is the vendor/store's ability to discount.

Plus, cranking the price up doesn't "account for the discounters" -- it actually helps them. The higher SRP certainly doesn't help the non-discount vendors, since they're the ones having to charge the high price to their customer.

The court recognized the cultural function of local book stores. Price-fixing allows small local book stores to stay in business, and it allows publishers to print titles that have only a small audience, like poetry - or RPGs .

I can see how it can artificially keep small local book stories in business, but I don't see how it allows publishers to print titles that only have a small audience.

Ultimately, the FLGS needs to figure out how to provide a service that people want and a price people are willing to pay.

Justin Alexander
http://www.thealexandrian.net

 

[Mercule]

And kids that age don't have credit cards. They are shut out as customers from online sales unless they can persuade somebody else to buy it for them with a credit card.

I wasn't talking about online stores compared to brick and mortar. I don't think the LGS is significant for the hobby compared to B&N or Borders brick and mortar.

Really, having a Barnes and Noble in the mall, where teens are actually more likely to pass by it and impulse buy the PHB is probably going to do a lot more for growing the hobby than Dan's Gamer Heaven that's "conveniently located" at the ass-end of town.

If you want to compare the FLGS to the Internet market, the Internet has one big advantage: location. I've only seen a couple of game/comic/hobby stores that were anywhere near where tweens/teens/college kids are likely to be. Those stores are, universally, pretty solid in their business and growing the last time I stopped in. On the contrary, most LGS are somewhere you'd need a car (in short supply for your growth market) to get to. Heck, my LGS is pretty close to where I work, but is on a back road with lousy parking and is a pain to exit, so I never go there and I have a car.

 

[Steel_Wind]

I have no doubt my perception of the FLGS is shaped by the city in which I live - Toronto. It's one of the largest metropolitan areas in North America. NY and LA are bigger and Chicago somewhat larger - but that's it. And unlike those three cities, Toronto's FLGS's have been for the most part untouched by internet discounters because of shipping costs. So we are still carrying on a tradition mostly unaffected by the Internet here.

As a consequence, I would argue that the FLGS's here in my city are probably more healthy and numerous than anywhere else on the continent, relatively speaking.

What we see here are not simply gaming stores in the ass end of town (though those are there too). We have the two of the largest shops in town a stones throw away from one another on Yonge St., a block north of Dundas. To put that in perspective, that would be a block north from Times Square, in terms of its retail positioning within NYC. (Yonge and Dundas being Canada's version of Times Square).

The stores are in between a large university campus on block to the East and Uof T is five minutes to the West. They are both steps from the subway.

One features lots of CCG's, Boardgames, minis and a complete D20 WotC inventory with 10 other RPGs stocked at prices that most US internet discounters have a hard time touching. (Complete Champion I bought a few days ago at 401 Games for 26.99 CDN - so about $25 USD). Looking at the prices online, that ain't bad. It has large space upstairs for gaming and more tables downstairs used all the time for cards.

In all seriousness, as FLGS's go, I would say 401 Games is the ideal retailer if you are WotC or Wizkids. You could hardly ask for a better one.

The other shop immediately downtown (HairyT) is more of a hole in the wall gamer dive, but it has some game space and a large inventory of RPG titles that you do not find at anything but the best stocked specialty shop. It offers the kind of exposure to other brands and games that we used to take for granted in the business 10 years ago but which are rare these days south of the border.

The story is repeated elsewhere in Toronto in nearly a dozen other middlin to large FLGS shops. The retail model from 10 years ago never left here; it never died out.

Doubtless I'm biased and I may be seeing things through rose colored glasses. But we have well supplied gaming shops in large Triple A and Double A tier shopping malls in this city too. (Admittedly, no gaming space in those stores). So being confined to the ass end of town never happened here.

Given a choice between the internet, the traditional FLGS shops still very much a fixture of the market in Toronto and the B&N model you point to in the USA, I don't think there is any question as a hobby games mftr which one sells my product best and introduces it to new players the most effectively.

 

[Vocenoctum]

I can't figure out not only the FLGS anti-love, but the complaints of a 20-30 minute drive to get to one. That's a problem?

It's a "factor".
I live say, 40 miles from my FLGS. I pay $30+6% tax there for a $30 book, so 31.80. Add in 4 gallons of gas at $2.50 each, and that book costs me $41.80. I browse the wares, but frankly the variety of selection lacks. Generally book is available day or release for WotC.

I live about 2 miles from Borders, almost always buy with a coupon (-20%). Gas is negligible. Cost of same book=$25.44, I browse the selection and buy all my novels there. Generally book is available day of release or soon after for WotC.

I live about 5' from my mailbox. From buy.com I pay around $18.90 for that same book. Need to buy more than 1 book/ item to hit free shipping, but never a big problem. Generally available day of release, shipping means it get me around the end of the week.

So, the FLGS doesn't really add anything for me, does it?

 

[Steel_Wind]

I can't figure out not only the FLGS anti-love, but the complaints of a 20-30 minute drive to get to one. That's a problem?

Even now, I have a 2 hour round trip commute to work, so going 20-30 minutes away to browse games is nothing.

You sound like me. It's an hour and 15 minutes in to work for me in the morning and about the same back. An extra subway stop adding 15 minutes to the way back home to hit a FLGS is no biggie.

But I have a lot of family in smaller cities in Canada, who go positively bug-eyed with the thought of an hour and 15 minute commute in to work. I spend more time commuting in a day than they do in a week (by far. Some more in a day than they do in a month).

It's what you are used to I think that impacts on the subjective reasonableness of any trip.