Successful CMOs achieve growth by leveraging technology. Join us for GrowthBeat Summit on June 1-2 in Boston
, where we'll discuss how to merge creativity with technology to drive growth. Space is limited. Request your personal invitation here
For more on Xbox One, check out our complete coverage.
GameStop president Tony Bartel says that with two new next-gen consoles this year, “the gamers win.” The gaming retail giant is preparing for the upcoming releases of two major consoles: the PlayStation 4 and the Xbox One, which Microsoft announced today, and the ramifications this could have on one of its major sources of revenue: used games.
In a phone interview with GamesBeat, Bartel spoke about the importance of the used games market and his concerns for next-gen consoles from Microsoft and Sony, both of which launch before the end of the year. We talked to Bartel to get a major retailer’s perspective on a new console announcement and what it means for the world’s largest seller of games.
The Xbox One may seem like an odd name for the new box. It’s Microsoft’s third console. We asked Bartel his perspective as a retailer on that branding. “[It’s] definitely surprising after we heard the speculation. We are going to have to stop saying Xbox 720 and say Xbox One,” he said. “It’s simple. I think that’s what they were after. By the time that this thing comes around, it will be rolling off all of our tongues.”
Bartel would not go into specifics about used games, which will require a fee for play on separate Xbox accounts according to Wired. “They have not discussed that with us yet. What they are going to say, if they haven’t said it already, is that they are going to design it [Xbox One] to work with trade-in and resell games. [Even Microsoft isn’t sure — Ed.] We’re going to work very closely to make this a seamless transition from Xbox 360 to Xbox One,” said Bartel.
Above: GameStop president Tony Bartel
Image Credit: GameStop
Bartel used Electronic Arts as an example, “EA said, ‘Look, our Online Pass isn’t working.'” The publisher recently discontinued its Online Pass program, which had players pay an extra fee for full online features when they purchased games used. “Any type of friction implemented into the system would make it more difficult [for consumers],” and Bartel says that retailers and console makers want as little friction as possible.
Pressed further on used games, Bartel says, “We can’t speculate. I’ll go with what we do know. The point is that the buy-sell-trade model is very positive. Over a billion dollars of trade credit is applied mostly toward new games [About 70 percent of trade-in credit goes into new games, according to Bartel].”
Microsoft and Sony won’t kill the used games market, but whose console will launch first? Microsoft or Sony? “That’s a good question,” said Bartel, saying that we know both will come before the end of the year, but “the gamer wins in this whole deal, and that’s what I’m excited about. I like that Microsoft says they have more games in development than they’ve ever had in their history.”
In preparation for upcoming launches, GameStop announced its “First to Know” list. The retailer already has gamers signing up. “First to Know” is a service GameStop offers to those who want to receive email and notifications about upcoming consoles, such as price announcements, release dates and other relevant information.
“We are going to have a good idea of which people are going to want these consoles,” said Bartel. The retailer keeps track of members of its “PowerUp Rewards” program, which GameStop customers sign up for to receive additional trade-in credit and bonuses for being frequent shoppers. That information helps GameStop learn what kind of purchases certain consumers are likely to make and which gamers to target with specific games or consoles.
When asked what the most important thing for a retailer to nail down during a console launch, Bartel said, “I think it’s two things. It comes down to understanding the console and affordability.
Bartel mentioned GameStop’s annual manager’s meeting in Las Vegas and said that there will be extensive training, as the company aims to have the most knowledgeable staff on-hand. “We will have 40,000 trained associates working this holiday season understanding the differences between the two consoles.”
Price is always a concern, something Sony experienced firsthand when it slotted its PlayStation 3 at launch for $599. “[The] second is affordability. We’re working very closely with both platform holders [Sony and Microsoft] as well as publishers to drive the buy, sell, trade model to ensure that we will be the most affordable retailer.”
VentureBeat’s VB Insight team is studying marketing analytics...
Chime in here, and we’ll share the results.