Has the retail onslaught that the likes of eBay and Amazon have brought forth over the last decade or so taught anything to the likes of big box retailers? What about the fact that I can more easily, not to mention more conveniently purchase and download a new PS3 or PS4 game without even having to leave my fancy, fake-leather couch? Market disruptions are nothing new, and new ideas and new technology has always forced agile businesses into pivots, whether they liked it or not. Some companies however, still don’t seem to accept the reality of the market that is moving around them, and by some companies I mean GameStop. Just recently – yesterday in fact – Paul Raines, GameStop’s Chief Executive Officer, announced “that the company plans that to open 300 to 400 retail locations which will have a focus outside of games”. (SeekingAlpha, 28 March) Yeah, I’m scratching my head too – more brick and mortar overhead, and lots of it, but not to sell games. Rather, these new store shelves will house smart phones and wearable technology products. Still confused? So am I.
GameStop continues to get dragged down financially by its physical retail presence, even as it continues to shift towards digital markets. Hardware, software, and even used sales all declined in 2012, and the only business category to show growth was GameStop’s “other” category, which covers those digital markets.