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Varchild2008 (84.64)

GAMESTOP: You are a Cannibal

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November 14, 2011 – Comments (1) | RELATED TICKERS: GME

Cannibalizing sales doesn't necessarily mean earnings are going SOUTH. It just means you are selling more digital copies of Battlefield 3, less copies of NEW SKU Physical.

Therefore.... NPD Reports come out looking much worse than they would/should have.

Impulse is FAR BETTER than what Gamestop.com had before when selling Digital Copies of games. Therefore, DIGITAL sales (in my opinion guess making skills) have skyrocketed for them since IMPULSE.

So Gamestop is not necessarily losing earnings..profit...income....revenue.....etc. from selling digital (Although some can argue it hurts Re-Sale).  They are losing Bricks Business!

Their Same Store Sales are taking hits. Major hits in my opinion. That's not good.

What GAMESTOP could theoretically do to limit the damage is to tie more of the DIGITAL sales to the stores.

A) Impulse Currency Cards would greatly help. Especially now with hacker concerns over at STEAM. In this way the STOREs get a share of the digital sales.

Those that buy IMPULSE digital games as they are bought today, the money goes to IMPULSE to manage. Stores see nothing.

With Impulse Currency Cards...Those afraid of getting their Credit Card Number stolen by hackers...will buy currency cards with CASH at GAMESTOP stores and just use those like a gift card.

It's the HOLIDAYs Gamestop. Where's my IMPULSE Gift Card??????????

IMPULSE sees no money from these transactions as it all goes to the STORES.

But so what for them?  Impulse is now Gamestop.  It shouldn't hurt paychecks if Impulse Team has to share some of the earnings with the Bricks Stores.

B)Refer back to physical deals....

Huh? Basically sell DIGITAL games but at times tie the physical stores to the overall deal you got when buying the game on IMPULSE.

It's simple...

It could be "PRE-ORDER PROTOTYPE 2 on IMPULSE and get $5 off any Pre-Owned Physical Game at GAMESTOP.

The reality is if GAMESTOP is going to keep canniballizing their stores then they are NUTZ and the SHORT FLOAT will keep climbing.

If GAMESTOP does the right thing here and brings DIGITAL customers to PHYSICAL stores or brings some of the DIGITAL $$$$ to the PHYSICAL stores....the Shorts are in deep deep deep deep deep trouble.            

1 Comments – Post Your Own

#1) On November 15, 2011 at 11:28 PM, memoandstitch (< 20) wrote:

In the mean time, 

http://youtu.be/onEfmC6HRF4

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