WotC and brick and mortar retail stores - Greg Leeds weighs in

Windjammer

Adventurer
Over the last couple of days, there's been an interesting exchange of sorts between a retailer and WotC president Greg Leeds. 'Exchange' may stretch the terms here, but in essence a retailer presented his situation and Leeds wrote a response. I'm going to quote both in full and, to round it off, I'm going to quote what a retailer related on another forum - anonymously; he's on this board, and if he wishes to put a name to the post, I leave it at his discretion, not mine.
Retailer Mike King:


View from the Game Store--Industry Relationships

Column by Marcus King

Published: 03/16/2010 12:00am


View from the Game Store is a new weekly(-ish) column by Marcus King of Titan Games & Music in Battle Creek, Michigan. This week, King looks at how the relationship between publishers, distributors, retailers and the consumer has changed over the last decade, and what it means:

Keeping in mind these are just my opinions, based on my experiences as a retailer for 24 years in the game industry, here is what I have seen, and what I see as the future of tabletop gaming.

Years Ago:

When I started as a game store owner, consumers valued a retail store. Most stores were "destination" stores, because gamers would seek them out. Retail stores were the place to learn about new games, to trade in old games, to meet other gamers, and game.

When I started at this as a game storeowner in 1986, publishers made games, distributors stocked them--usually fairly deeply, and retailers called distributors to buy the games they sold. Distributors also made SALES calls, where they would call the retailer and pitch them on new games. Retailers stocked games and consumers went to those "fairly scarce" locations to see the games. Retailers were the center of information for consumers, distributors were the source of that information for the retailers. Publishers published. Distributors distributed. Retailers retailed. Life was simple.

Then, several things happened to change the industry: eBay, the Internet itself, Amazon and the birth of the discount game sources are what I am talking about (one could also argue that video games and home computers had a big impact too, and I believe that to be true, but in the scheme of things, not on the relationships aspect, which is what I am talking about today).

Prior to all that if you wanted a game you either called a company listed in Dragon magazine, or you went to a game store, or attended a convention. But, the Internet, eBay and other discount places changed all that.

Today:

Publishers make games. They sell them to distributors, direct to the consumer via the Internet, and at some conventions--how many conventions often depends on which publisher you are talking about. Publishers also sell direct to the retailers--and how much of this they do greatly depends on the success of their games. In this regard, the publishers now act as competition to both the distributors and retailers.

Distributors are more often now concentrating on the "order taking operations." Not information centers for the retailers. That is neither good or bad, mind you--it just is the case more often than not. Nowadays it matters MORE to me how quickly my rep at my distributor (Alliance Games, most often) returns my call, than how much information he has to relay to me. And, my distributor rep (Brian) is very capable of getting me information. But, more often than not, I get my information from other sources--such as ICv2, BoardGameGeek, RPGNet and others, to name only a few. I also get my information direct from publishers, where I am signed up for news releases from over 40 publishers.

Retailers are usually "outgunned" in the information on any given product--by the consumer! The consumer who likes Magic: The Gathering will read and learn about his one passion--while the retailer has maybe 2,500 products to keep track of, and over 200 new release titles every month to consider. So, the consumer knows MORE about their hobby than the retailer does. If you play Legends of the Five Rings--I know more about Magic than you do. But, you know more about L5R than I do. So, while I am "fairly informed" on more than a thousand products and publications--someone who is into D&D knows the release schedule maybe better than I do.

This has changed the relationships of all parties involved. Where the retail store owner used to be revered as a guy with the coolest possible job, they are now often looked at and viewed--by consumers--as some poor doofus who is hopelessly misinformed on all things gaming, and who is akin to a money grubbing greedy guy who charges "full retail price"--when, only dummy's pay full retail. The consumers know they can find the item at a discount. Distributors know that retail stores last, on average, about 18 months. Long term relationships take a back seat when you don't know if the guy will be ordering from you next year, or not.

Publishers, more and more capable of selling products direct to retailers, view the distributors as less valuable than before. Those same distributors, selling a lot of games direct to consumers also find the retailers less important to their operation. Some publishers have actually stopped selling their products wholesale.

So, what is the solution? Well, if you were hoping for a solution, I am sorry to disappoint. I don't have one. Owning two stores in Michigan, I wish I had a solution. I guess for me, the solution is to offer a good selection, take used games in trade, stock deeply in the lines we carry, have convenient hours, a well trained and professional staff, and offer gaming space for my customers to enjoy.

After all, in the age of the Internet you CAN find it cheaper elsewhere. You will find a better product knowledge elsewhere. What I can offer is a nice shopping environment you will enjoy coming to, and a good selection of merchandise to choose from you can take with you today. And, hopefully for some time to come, that will be valued by some consumers.
Greg Leeds' response:

Greg Leeds of Wizards of the Coast on Industry Relationships

'One Additional Perspective'

Published: 03/19/2010, Last Updated: 03/23/2010 05:03am


Greg Leeds, the President of Wizards of the Coast, read Marcus King's most recent column regarding game market relationships (see "View from the Game Store--Industry Relationships") and had this to say:

After reading a great Talk Back column from Marcus King of Titan Games & Music in Battle Creek, Michigan, I want to provide one additional perspective. Like Marcus, I also sometimes yearn for the simplicity of the old days. However, at Wizards of the Coast, we believe strongly that part of the solution to keep a thriving and successful Hobby retail industry is to build great in-store organized play experiences.

No change in Publisher roles or Distributor roles or Internet/Video Game habits can usurp the local game shop's ability to provide the human interaction that we all crave. Gamers want and will pay for great human connection experiences as they do in many other parts of their lives.

Of course the internet can provide pricing efficiency and information but it cannot replace:

the 'third space' experience of a great coffee shop or
the thrill of a 3D full screen movie theater experience or
the camaraderie of a local pub or
the belongingness of attending a live sports event or
..the bliss of gaming with like-minded folks in a great neighborhood store.

At Wizards, we spend every waking moment thinking about great game experiences. Of course, we continue to design the best games on the face of the earth J, but we also constantly make adjustments for stores to successfully build their player base and community. For example, last year we changed our policy to broaden the thrilling Magic pre-release events to include many more hobby stores. We are constantly striving to provide great exclusive promotional incentives so stores can support more fun play. We also look at new play formats to keep gaming fresh such as Magic multiplayer events and D&D Encounters. We also do our part to educate the industry about how more in store play means more retail revenue. We share best practices from the great stores around the world--ranging from basics like snack sales, lighting and cleanliness to more complicated issues such as gamer behavior management.

In the end though, we believe that there are many great stores who know how to provide gaming entertainment worth paying for and this is why our industry will continue to thrive. Wizards is proud to play its role.
And, an additional perspective which antedates the above exchange but is very recent (put outside quote tags because they've for some reason killed the formatting - don't we love forum software):

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"From the point of view of a game store manager, it seems clear to me that 4E is not as successful as Wizards of the Coast needed it to be, and that they are pushing hard to fix it.

As a buyer for a game store, I can say the lack of Arcane Powers 2, Dungeon Masters Guide 3 and the imminent publication of The Rules Compendium seems ominous. It feels like the end of 3.5 did, only on an accellerated schedule.

As a seller of 4E books, I can tell you that sales have dropped dramatically for new books. The first 60 days of sales of Martial Powers 2 was well under half the comparable sales of Martial Powers 1, and whereas I used to bring in a dozen or more copies of each new book for opening week, I am now bringing in no more than half a dozen.

As a direct customer of Wizards of the Coast, I can say that their marketing has become increasingly and nakedly aggressive. For example, in order to receive and be able to sell the Player's Handbook 3 on the same date Barnes and Noble does, our store had to agree to host World Wide Game Day Player Handbook 3 Adventure, otherwise we'd have to wait over 10 days later to release (and no game store can afford to cross Wizards of the Coast regarding release dates, let me tell you). Host Game Day, or give Barnes and Noble (who regularly breaks release dates without consequence) ten days head start? Not actually a choice.

Or consider D&D Encounters. This is Wizards new program to promote 4E play in store. Starting at first level, an adventure a week, for twelve weeks, with the promise of additional "seasons" of play. There is an explicit in-game mechanism, called Reknown, which rewards players who have access to and use specific published materials, and which disadvantages characters in game who do not. At various Reknown totals, players gain the equivalent of encounter powers for their characters, above and beyond what they entitled to for their class, level, and magic items, and some of the highest Reknown rewards are awarded for using specific products.

That is, a player with access with to just the original Player's Handbook playing a Ranger with a photocopied character sheet will actually have one less encounter power at first level than a the player sitting next to him playing a Psion Shardmind built using the Character Builder, at least until he has caught up with the Psion's Reknown. But the Psion will almost always have more Reknown.

The D&D Encounters adventure itself is not entirely self-contained, but depends on DM knowledge of both the Forgotten Realms Player's Guide and the Forgotten Realms Campaign Guide. It is specificly tied to that setting, and the mechanics contained. In order to be able to sell new 4E books without waiting an additional ten days, either I, or the store, are going to have to eat the cost of two of the most expensive 4E books published.

Further, it is obviously that they are putting much more effort into the promotional adventures. Both the World Wide Game Day and D&D Encounter adventures have actual authors, editors, and staff credited, and are substantially less awful than previous efforts. While still lame, they require much less effort to fix, as they are more internally consistant, and have fewer contradictions, errors, and omissions. At least it's clear they have an author, and are edited.

It feels to me like Hasbro has lit a fire under Wizards of the Coast, and given them an ultimatum: Perform or Be Sold Off. There was an article recently in the Wall Street Journal about Hasbro's performance and profitability. Transformers and G.I. Joe get kudos, they discuss their Parker Brothers and Avalon Hill board game lines, but neither Magic the Gathering nor Dungeons and Dragons even rates a mention!

That is suggestive of the sad state of Wizards of the Coast."

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I'm A Banana

Potassium-Rich
I'm not so sure about the gloom & doom. I'm no game store owner, but "perform or be sold off!" seems hyperbolic to me. And remember, I'm pretty hyperbolic. ;)

I think Greg Leeds has basically the right idea -- game stores promote games, and D&D is a game, which needs to be played with other human beings to be fully enjoyed, and so game stores are what he's using to bring human beings together to enjoy the game.

Of course, the culture is shifting right out from under him in a pretty dynamic way. But it's impossible to predict, and I think the game store play effort is a good one (though I'm sad to see such obnoxiously divisive rules elements as Reknown being tossed about). Certainly better than doing nothing.

DDI, I think, bridges the gap between what the game store owner sees and what WotC sees. Martial Power 2, forex, is a book full of crunch that appeals to collectors of crunch, so we'll see more people gravitating toward DDI and the Character Builder for that, where I can access all of the crunch, without having to lug around an extra book. A product like Dungeon Tiles or Underdark isn't so limited.

Personally, I think there's better ways to encourage individual participation than hobby game stores. D&D needs to get into high schools and GameStop and onto consoles (think: MapTool you can download on Xbox live and find a group to play). But this is all bold new territory for a game traditionally sold by dudes behind desks.

D&D is niche. It's never gonna reach the level of GI Joe and Transformers (though a better movie based on the game would certainly help -- I can easily imagine a Michael Bay fight scene with a Red Dragon, and that would sell some action figures!). I don't know WotC's internal operation, but I think they're probably fairly content with the game. I see they're continually trying to make it better.

I didn't know about the lack of a DMG3, which is a little tragic, but clearly they're flexible. ;)
 

Windjammer

Adventurer
These three quoted posts have nothing to do with each other.

I messed up when quoting the first post (and copy-pasted a wrong one), but fixed it - one minute before you wrote yours. I guess you read the OP before I fixed it. Your judgement that the third quote has nothing to do with the first two remains unaffected, though. I did find it worthwhile to learn that retailers are currently forced to host WotC promotion events to get a bonus that online stores get for free - the possibility to sell new product as early as possible.
 

Windjammer

Adventurer
Personally, I think there's better ways to encourage individual participation than hobby game stores. D&D needs to get into high schools and GameStop and onto consoles (think: MapTool you can download on Xbox live and find a group to play). But this is all bold new territory for a game traditionally sold by dudes behind desks.

Well, if the OSR can, so can the 800 pound gorilla. ;)

Seriously, around 2007-2008 WotC put out huge budgets for people volunteering to found D&D-specific university clubs. I think they ought to look into a similar program, if at vastly less scale (i.e. less budget), for high schools.
 


Fanaelialae

Legend
Last I'd heard, DMG 3 and AP 2 were delayed til next year, to make room for the Essentials "starter kit" line coming out later this year.
 

Insight

Adventurer
The second, unnamed retailer comes across as a real crybaby. In particular,

Or consider D&D Encounters. This is Wizards new program to promote 4E play in store. Starting at first level, an adventure a week, for twelve weeks, with the promise of additional "seasons" of play. There is an explicit in-game mechanism, called Reknown, which rewards players who have access to and use specific published materials, and which disadvantages characters in game who do not. At various Reknown totals, players gain the equivalent of encounter powers for their characters, above and beyond what they entitled to for their class, level, and magic items, and some of the highest Reknown rewards are awarded for using specific products.

That is, a player with access with to just the original Player's Handbook playing a Ranger with a photocopied character sheet will actually have one less encounter power at first level than a the player sitting next to him playing a Psion Shardmind built using the Character Builder, at least until he has caught up with the Psion's Reknown. But the Psion will almost always have more Reknown.

The D&D Encounters adventure itself is not entirely self-contained, but depends on DM knowledge of both the Forgotten Realms Player's Guide and the Forgotten Realms Campaign Guide. It is specificly tied to that setting, and the mechanics contained. In order to be able to sell new 4E books without waiting an additional ten days, either I, or the store, are going to have to eat the cost of two of the most expensive 4E books published.

Much of this is patently untrue.

The Renown system allows people to catch up because most of the awards are one-time only. Eventually, if someone plays enough and puts forth the effort, they will get all of the Renown awards. It's possible that someone could be left behind, but it's highly unlikely that would happen for someone who plays regularly.

The adventure absolutely does not require someone to own the FRCG and the FRPG. Everything you need to run the adventure is included. The vast majority of the encounters will be within Undermountain, which is not detailed in either cited book. I fail to see how WotC is requiring the DM to have these books.
 
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Holy Bovine

First Post
There was an article recently in the Wall Street Journal about Hasbro's performance and profitability. Transformers and G.I. Joe get kudos, they discuss their Parker Brothers and Avalon Hill board game lines, but neither Magic the Gathering nor Dungeons and Dragons even rates a mention!

I guess this person has never read any of the other, dozen or so, articles regarding the same thing over the years. D&D never gets mentioned and MtG only rarely. Most gamers are sadly out of touch with how tiny their hobby really is. I remember Ryan Dancey stating, back in 2001-2 that the total market for RPGs was about 35 million per year.. There are individual medium sized businesses that do more than that a year.
 

filthgrinder

First Post
The Renown system allows people to catch up because most of the awards are one-time only. Eventually, if someone plays enough and puts forth the effort, they will get all of the Renown awards. It's possible that someone could be left behind, but it's highly unlikely that would happen for someone who plays regularly.

The adventure absolutely does not require someone to own the FRCG and the FRPG. Everything you need to run the adventure is included. The vast majority of the encounters will be within Undermountain, which is not detailed in either cited book. I fail to see how WotC is requiring the DM to have these books.

Also the Renown awards cited by the "unnamed retailer" encourage players to use new options presented in the PHB3... which encourages players to buy the book... which the "unnamed retailer" is crying that people aren't.

I mean, let's go with the given situation. Someone who only has PHB1, makes an elf ranger. They come to the game and learn, "hey, you get a renown award for playing a new race or class". This player might go, "oh, cool, let me pick up a copy of the new book". Imagine that, a promotion, PROMOTING products? Amazing!

The requirements for the FR books is silly as well, as everything needed to run and play the adventure are provided. They even include pregens as well. They do encourage the use of the character builder, but they want to promote their products, so can we really fault them for that?

The whole quote three way conversation comes off pretty weird. The first post bemoans the decline of hobby stores. The situation isn't unique to hobby stores, all brick and motar stores are feeling the same pains as time shifts. Dealing with the changes is how your business will survive. It's a reality of the current economy. The post from WotC is actually really nice and outlines one of the strategies that hobby stores need to look at, which is to create the "third space" coffee shop idea. This isn't unique to hobby stores either, it's a hot topic in all of brick and mortar retail. Look at the big box bookstores, they are trying the same things as well. Borders and Barnes and Noble have both converted to actually selling coffee but offering up a space for people to come and read and relax. They offer free wifi to customers, aimed at getting people to come into the store. Barnes and Noble's e-reader device, "The Nook" was touted as offering free wifi and free reading within a Barnes and Noble. That hasn't happened yet, but it shows the head space those retailers are in.

The "breaking the street date" the retailer mentioned offer from Wizards was simply, "enroll in our live play program and you can start selling books 10 days before the release date". It allows hobby stores to compete with Amazon. He mentioned B&N breaking street dates, but I don't know enough about that either way to comment.

I think part of the "sour grapes" feel of the "unnamed retailer" is because it is a laser beam response to WotC, when the problem being talked about is not just industry wide, but a program with brick and mortar stores and especially niche retailers.

And lastly, WotC is never mentioned in Hasbro's financial statements, ever. They are too small to specifically highlighted when compared with the revenue with GI Joe and the like.
 

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