UK Game Retailer Claims Trade-Ins Funded Half of New Sales over Holidays

[Logan Westbrook]

UK Game Retailer Claims Trade-Ins Funded Half of New Sales over Holidays

The pre-owned market is growing bigger and bigger, says retailer GAME's CEO.

Publishers have been fretting over pre-owned sales for a while now, and more than one has started to try to encourage consumers to buy their games new, either by offering bonuses to those who do, or barring certain features to those who don't. But UK retailer GAME says that it's not quite as black and white as people buying either pre-owned or new games, and that it often finds that the former funds the latter.

GAME CEO Ian Shepherd said that customers often trade in old games against the price of a new one, and that over the Holiday period, somewhere between fifty and sixty percent of all new games sales had been funded - at least in part - by someone trading in a game. He also said that GAME's pre-owned business had received a pretty significant boost from rival schemes from other retailers, as they had increased the profile of used games, as well as legitimatized the idea to a lot of people.

"We've got a very strong competitive advantage over companies that can't do trade-in in the way that we can," he said. "We've built up a real body of expertise and experience over the last 15 to 20 years. That makes our pre-owned offer hard to replicate ... When you look on a store-by-store basis, at areas where our multi-outlet competitors have started doing trade-ins, if anything our own trade-in business has got bigger."

Obviously, publishers would prefer it if every game that retailers sold was brand new, but that's clearly not going to happen any time soon. Publishers are justified in wanting to make money, but then again, so are retailers, and pre-owned sales have the highest margins. Hopefully, the tension between the two will ease as DLC becomes more common in the coming years, allowing publishers to generate a decent amount of revenue, even from players who bought pre-owned.

Source: MCV [http://www.mcvuk.com/news/42669/GAME-Trade-in-drives-60-of-new-game-sales]




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[Daystar Clarion]

Makes quite a bit of sense. I know developers would rather their games be bought at full price, but 10,000 games purchased through part exchange is better that not selling any at all, right?

 

[The_root_of_all_evil]

Perhaps they could get back to selling/re-selling PC games sometime? Just a thought.

And not just creaming themself over War of Warfare War XXXII.

 

[JediMB]

The problem is that £40 is a big investment and any reduction on that is most welcome since it is still basically just an Optical Disk.

You're not paying for an optical disc.

You're paying for a crafted experience, and the work put into making it real.

 

[Sebenko]

I hear there are no used games on Steam. Why don't the use that?

Oh right, it's on PC.

 

[Gralian]

You know how to eliminate this? Stop obsessing over DLC; sell your games cheaper brand new. Hell, you could even incentivise people to pick it up on launch week by reducing the cost by 25% in the first week of release. So the first week Dead Space 2 is out for example, they could sell it for £30 instead of £40. But tbh they should be selling games new at £30 anyway, if not less. The reason preowned sales are through the roof is simply how amazingly cheap they are in comparison to new copies. I've seen oldish new games go for £25+ when a used copy is £10 or £15. That is disgusting. Retailers and publishers alike need to focus on keeping their 'new' copies and stock up to date, especially in the pricing. A lot of people don't care for DLC. I don't - i hate the download time, i hate pissing about with 'points', i hate paying for an experience that's barely as long as a movie before it's already over. Slow down with the DLC; speed up with the price cuts. Everybody wins.

 

[Corpse XxX]

I've never actually bought a used game my entire life.. And i have quite the collection of games..

Biggest reason is probably that there is now trade-ins possible in the proximity of where i live..

 

[Mehall]

I'm not surprised by this, but then again I do work for that company.

Also: can you use a less old stock photo? That one is around 7 years or more old.
I can imagine anyone who knows GAME would notice that they don't put all that yellow in the windows. Nor do they advertise for original XBoxes

 

[Baresark]

The problem for me is that there does not seem to be games that will last that long these days. I can go back and play Diablo 1 & 2 still, and I can't count the amount of times I played through Chrono Trigger, but there is not a lot of replay value in a game anymore. I like unlockables, and cool items to work for on a second or even third playthrough. That is what made me go back to DeadSpace for a second run through.

Also, for me, multiplayer and trophies are not incentive to keep playing a game. The fact is, there is so much to play out there, the best idea seems to be to produce less expensive games more often. Quality doesn't have to suffer either, like I'm sure so many people will say it does.

Make games worth holding onto, then there will be less used sales, and therefore more new sales.

 

[Prometherion]

I would actually like to see the mark up between the cost of the disc to make and the retail cost.

£45 is a lot of money for new games people simply cant afford the frankly extortionate cost of games. Pre-owned games are an alternative for people who cant afford the mark up but still love to play games.

 

[1deano1]

Can't say i'm surprised. GAME do brilliantly on their deals. However I have seen the odd fail moment... Such as when they have a new game priced at a certain amount and are also selling a 2nd hand copy but for more...

 

[Tiswas]

Not surprising considering the likes of Fifa, Guitar Hero, COD, Halo 3 and Just Dance.

The games that received upgrades near Christmas and the old ones currently flooding the used market. Most people traded in the old versions in order to get the new.

 

[Mehall]

Can't say i'm surprised. GAME do brilliantly on their deals. However I have seen the odd fail moment... Such as when they have a new game priced at a certain amount and are also selling a 2nd hand copy but for more...

Those happen 90% of the time when the mint game in question is on a special deal or sale. If the preowned one is more, it likely means the deal is publisher/supplier subsidised, as the preowned value is still set by standard market value. Other oddities do occur, like PS3 Force Unleashed 2 selling for £29.98 new, £27.99 preowned and trading in at £25 in store credit. Can't go wrong for £2.99, play it for the weekend though of course you can't guarantee the trade value ):

 

[1deano1]

True. Trade-in value varies quite a lot.

 

[Gralian]

You know how to eliminate this? Stop obsessing over DLC; sell your games cheaper brand new. Hell, you could even incentivise people to pick it up on launch week by reducing the cost by 25% in the first week of release. So the first week Dead Space 2 is out for example, they could sell it for £30 instead of £40. But tbh they should be selling games new at £30 anyway, if not less. The reason preowned sales are through the roof is simply how amazingly cheap they are in comparison to new copies. I've seen oldish new games go for £25+ when a used copy is £10 or £15. That is disgusting. Retailers and publishers alike need to focus on keeping their 'new' copies and stock up to date, especially in the pricing. A lot of people don't care for DLC. I don't - i hate the download time, i hate pissing about with 'points', i hate paying for an experience that's barely as long as a movie before it's already over. Slow down with the DLC; speed up with the price cuts. Everybody wins.

The reason pre-owned games will never need to focus on new copies is because they get less money from it. 100% beats 15%(don't know how much the cut is of new games but its something stupidly low) every day of the week. They have staff to pay and profits to make. Same as any business.

I know, but the retailing business is one of the major axes in the gaming industry at the moment. Moviebob did a video on it and he can explain it briefly for you if you go look up TheGameOverthinker. Retailers aren't our friends here. It's the developers. I don't care much for the shop staff, as cold as that may sound. They aren't the ones actually crafting the product. They're just the middle man who sells you the goods, and since the advent of the internet, online retailers really are a dime a dozen. So the whole cut-throat business model just does not fly with me. Developers and publishers are worried about pirates hurting sales? How 'bout they work something out with retailers to make things more for all-round. Like evening up the profit margins so retailers don't get screwed when they sell a new copy and devs and pubs get -something- when a second hand sale is made from a major retailer. It can't be that hard to work out a better system.