GameStop: "We're On Offense When It Comes to Digital"

President Tony Bartel says that in fact, most of the company's digital revenue comes from its brick-and-mortar stores.

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Some believed that the rise in digital distribution for games would lead to the downfall of retailer GameStop, but it doesn't look like that's going to happen, at least not anytime soon. In a new interview with VentureBeat, GameStop president Tony Bartel outlines some of the ways in which the retailer is not only surviving--but thriving--in this increasingly digital age of gaming.

"Most of our digital revenue comes from our brick-and-mortar stores," Bartel said. "The console digital is predominantly things like Xbox Live, PlayStation Network, and Nintendo eShop cards. Then there's downloadable content, which is fast-growing in the console digital."

GameStop's total digital sales for 2013, including the company's Kongregate mobile gaming platform, PC downloads, and in-store digital sales, came out to $724.4 million. And things are already looking up so far this year, with first quarter digital revenue up 9.5 percent year-over-year.

One digital sector that GameStop is seeing solid performance in is DLC season passes. Bartel said Ubisoft games have been particularly successful. "Over 70 percent of the season passes for Ubisoft's games in Q1 were sold through physical retailers," Bartel said, citing Ubisoft data "We believe that we nearly corner that market as far as digital downloads."

"We don't talk about defending against digital distribution. We talk about driving digital distribution. We're on offense when it comes to digital" -- Tony Bartel

For Watch Dogs, 30 percent of the people who bought the game also purchased the $20 season pass, Bartel said.

Bartel went on to say that he believes shopping in a physical store for content is beneficial to the gamer because they can speak with a knowledgeable store associate. If you're shopping online, you don't get that.

"The reason we're so adamant about that is because we believe this downloadable content is incredible content," Bartel said. "It's just that not a lot of people know about it. It's not the most customer-friendly experience to find it on either PlayStation Network or Xbox Live."

Another reason why GameStop's digital business is booming, Bartel says, is because shoppers have flexibility with how they pay for games. "More than 60 percent of the payments for digital content [at GameStop] are not with credit cards," Bartel said. "It's trade credit, cash, gift cards, and things like that."

Overall, Bartel said GameStop's ambition with digital is to try to be a market-leader instead of thinking of itself as a company that needs to survive as digital distribution becomes more and more commonplace. "We don't talk about defending against digital distribution," Bartel said. "We talk about driving digital distribution. We're on offense when it comes to digital."

Eddie Makuch is a news editor at GameSpot, and you can follow him on Twitter @EddieMakuch
Got a news tip or want to contact us directly? Email news@gamespot.com

Discussion

164 comments
GredegHeado-san
GredegHeado-san

I know GameStop probably has 10 or 15 more years but I hope it's 5 or less.

jeremyc99999
jeremyc99999

They should get rid of the "Game" in Gamestop. Just the word Stop on their sign before you walk in. Would be great advice.

Hurvl
Hurvl

"most of the company's digital revenue comes from its brick-and-mortar stores" That sounds a bit backwards and awkward, but people can spend their money however they wish, even if it seems like traveling somewhere far away only to go and eat at McDonald's. Physical console games can be resold and download caps or bad download speeds makes it more convenient to go to a store, so Gamestop thrives from bad infrastructure. Better not hope that download speeds will get better, heh.

svaubel
svaubel

Season Passes, the newest disease in gaming, the acknowledgement that your $60 game is not a full game.

And people support this...

Zloth2
Zloth2

"For Watch Dogs, 30 percent of the people who bought the game also purchased the $20 season pass, Bartel said."

Umm, folks.... ARE YOU CRAZY???  DLC tends to be pretty dubious but buying DLC before you even know what's going to be made???

Tabarnaque
Tabarnaque

So I'm paying $30 more for my game by going in a store just so I can have a condescending game junky try to rip me off with season passes?

Digital distribution is the future, it can drastically drive down the price of games. Death to the overlard gamestop.

the13stuff
the13stuff

I have a hard time believing that GameStop would survive as-is in a primarily digital distribution take over. I don't want all digital, yet I also don't like to shop at Gamestop.

PlatinumPaladin
PlatinumPaladin

As someone who works in a brick 'n' mortar retailer, I feel a sense of relief that one company's managing to make the best of the encroaching digital apocalypse.

Bravo.

Wicked869
Wicked869

Bartel said GameStop's ambition with digital is to try to be a market-leader..... lolololololol

JDWolfie
JDWolfie

I mainly buy my games from Amazon, ebay, or Glyde. I recently sold them a bad Xbox 360 controller for $10 store credit and I went to a different one the same day and I apparently had an old gift card that I thought only had a few cents but it ended up being $20 or so and I ended up maybe paying around $25 or less for a new controller. No regrets. Don't plan on going back there for a long time.


The problem with the controller was the left stick was a little loose and during menu screens, the cursor was going everywhere. But it lasted me for almost ten years.

Derekuda
Derekuda

The only business I give gamestop is my yearly subscription to their monthly magazine. The pro discount on used games is a plus. But I never buy anything over $20 or trade anything to them.  

blackothh
blackothh

Well you got the offensive part right!




BrokenChaos666
BrokenChaos666

"shopping in a physical store for content is beneficial to the gamer because they can speak with a knowledgeable store associate. If you're shopping online, you don't get that."

HA. My local EB Games hired a new female employee who has zero knowledge of the gaming industry and clearly doesn't care to learn. She's just a pretty face to get the boys into the store.


With the internet I can quickly research any gaming information I need and make an informed decision on my purchase in just minutes. Why people buy digital content from stores is beyond me.

VolcanoMan001
VolcanoMan001

Actually, I think they are just plain offensive when it comes to how little they offer for your game, and how much they flip it for...

Ailurusf
Ailurusf

If I was an investor, I would be worried about Bartel's words. First, when it comes to games, physical retail is actually less informative than digital one. You basically only have the back of the box blurbs and the advice of a random teenager whose tastes you don't know. Online you can see pictures, videos, reviews, etc., and while browsing digital stores is cumbersome now, they're only an UI upgrade from destroying such disadvantage. If your business model depends on competitors doing things wrong, well, that's not a place I'd invest.

Second, there is a problem with your model if 60% of payments for digital comes from physical trade credit. This might work on the short term, but it's hardly sustainable in the long term. As more people acquire digital goods, they will have less stuff to trade later for credit, and thus will buy less stuff at gamestop.

Sohereiam
Sohereiam

I seriously read "We're a offense..."

OniLordAsmodeus
OniLordAsmodeus

Why is it that in every story related to Gamestop they use the same picture?

Barighm
Barighm

Yes, I agree GameStop is offensive.

maxpowr3
maxpowr3

Once I heard that Gamestop often removes "codes and other DLC freebies" from "new" games, I stopped buying from them. 

fester420
fester420

"Bartel went on to say that he believes shopping in a physical store for content is beneficial to the gamer because they can speak with a knowledgeable store associate. If you're shopping online, you don't get that."


This only applies to people who don't play video games and are buying them for someone else.  I love how they try to make it seem like gamers need them.

Sun-Tzu-GE
Sun-Tzu-GE

Since I got my PS4 I've been all digital and never looked back.It's very convenient and everything is available to download on day 1.The games which support pre-loading are even better.And here's a tip for you guys in Europe.If you create a US PSN account,you can buy all new games 30% cheaper because of conversion rates.

So you can't trade in your games if they're digital.So what? Does the $5 you get for trading in your used game really make much of a difference ? Not really.

ecter1216
ecter1216

You know what. Everytime I read a gamestop article there is always so many people saying they are the scum and bla bla bla. Saying they give you only like $4 on a new game return. That's complete BS. I have always gotten 30-45 bucks for any new game that I have returned within 2 weeks.  I even got 10 bucks for a game that was over a year old. 


Also the employees do know their stuff.  Sometimes even more then I do about a upcoming game I like. Yea sure they ask if you want to preorder like 4 times...but thats their job...Nothing wrong with doing your job. Anyway its always a lovely environment and place to hang out. 


And this is not just one gamestop...I get the same service from 3 Gamestops within 100 miles. You all must really have some shitty stores there. 

deathBRINGER201
deathBRINGER201

@Zloth2 Crazy? I've lost count how many season passes I've paid for and everyone was totally worth it but i guess some people have lost faith in developers or are less fortunate than me and don't have the money to burn. 

Hurvl
Hurvl

@Wicked869 They can try, but they'll get Steam-rolled right away.

hystavito
hystavito

@BrokenChaos666 I haven't had the best experiences when it comes to staff knowledge at EB Games (Canada).  It's not always bad, but one example was a staff telling me this story about how Sony went to Nvidia to have them specially design the GPU for the PS4 :).  This was when the hardware had been known for some time and this guy didn't just mention it in passing, he gave me a whole story and was really into it, then I corrected him and he was like oh :).


The only thing that is a nice change from other stores is that they do seem to know at least something about games and you can have a discussion with them like you might around here.  When you don't have any gamer friends, it's at least more fun to visit their store and have a gaming chat, than just walking into another retailer and buy or browse games.  However, I rarely buy there because their sales are almost never as good as the other stores, so ultimately I rarely have those chats :).

verk81
verk81

then sell it yourself. nobody makes you go there.

Hurvl
Hurvl

@Ailurusf Doing research is oh so f-ing hard. That is the only conclusion I can reach with them saying that retail and talking to a person is more informative than looking up stuff on the internet. That requires critical thinking, knowing what you want and being able to sort out what is useful info from reviews, trailers and screenshots. It's not easy, but it's not that hard I think.

verk81
verk81

that's completely untrue and associates would be fired if they were.

MaddenBowler10
MaddenBowler10

@fester420 No kidding, I don't think I've ever went in to GameStop and met an employee that knew more about any particular game than I did. In fact, I often find myself knowing more about their own deals going on at the time than the employee.

verk81
verk81

I traded 2 ps4 games and got 80 bucks store credit after I beat both. I'm pretty sure that's not a bad deal. I gotta stop reading these comment sections written by 12 year olds .

Barighm
Barighm

@Sun-Tzu-GE You can, and will, be banned for creating an account outside your region. Well, MS frequently bans people for that sort of thing anyway.


And you forget there are other ways to profit from selling used games. There's a reason some games go for hundreds of dollars these days. Digital completely kills that.

Sun-Tzu-GE
Sun-Tzu-GE

@ecter1216 If gamestop employees know more about games than you do,you obviously don't know much about gaming.No offense. 

VolcanoMan001
VolcanoMan001

@verk81 Thank you Captain Supreme Commander Obvious, that is exactly what I do. This has no bearing or relevance on whether or not I can be offended by it.

Zloth2
Zloth2

@verk81  Actually, I'm fairly sure there was a story along those lines a few years back.  The internet was Not Happy.

running_snake
running_snake

@verk81 Really? You must have been trading very new games. Which ones, and how long did you have them before selling them?

Sun-Tzu-GE
Sun-Tzu-GE

@Barighm @Sun-Tzu-GE People have been doing this for years on PS3 and nobody was banned.And think about the countries that don't have official PSN support.Everybody from those countries create either a UK or US account and don't have any problems.

Sohereiam
Sohereiam

@Barighm Sony doesn't ban, MS ban because MS uses a transfer account system, that allows you to transfer your account to the region you live, however Sun-Tzu-GE is taking advantage of his country economy and commerce laws to pay less than he should, that's actually fraud, and this might do more than just ban him.

ecter1216
ecter1216

@Sun-Tzu-GE @ecter1216 Not true, I am a gamer. I just dont have all the time to search everything about a game. Plus its nice to have conversations with people about a game you like. The employees at the gamestops here are great people.  This evil veil over gamestop being a horrible place is wrong. 



Sun-Tzu-GE
Sun-Tzu-GE

@Sohereiam Technically that's true,but people have been doing it on PS3 for years and nobody had legal problems.

ecter1216
ecter1216

@Sun-Tzu-GE @ecter1216 Also I have never gotten just $5 for any game I have ever traded in. I honestly think people saying that are just bullshitting . 

veryDERPY
veryDERPY

@ecter1216 they seem to think gamestops prices are a rip off even tho they're the ones looking to SELL (or trade...same thing) and gs is offering you a price they're willling to pay.


they're not very bright

xantufrog
xantufrog

@veryDERPY @ecter1216 Exactly. Also, I looked it up once: GameStop pays you more for your used game than they make a profit on selling new ones. So, as a seller, you actually make a better profit margin on your used cr@p than they do on their new merchandise.

bullsfan769
bullsfan769

@xantufrog @veryDERPY @ecter1216 the only thing thats annoying is the amount of money they pay you vs what they sell it for.  For example, I traded in ncaa football 14 for which they gave me $10 and then they are selling it for $45