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Best Buy Enters Used Games Market
Consumer electronics retailer Best Buy has entered the used videogames market.
“This week, several of our Dallas and Austin stores will test a kiosk-based model that allows customers to insert their used games into a kiosk that will scan it for functionality, and immediately issue a voucher that is instantly redeemable for a Best Buy gift card,” said the company’s chief marketing officer, Barry Judge.
“We’ll also be testing the sale of used games in those stores, and some of the kiosks will even rent games and movies. We’re excited about this test, especially because we know how deeply passionate our customers and our employees are about gaming, movies and entertainment overall.”
Following the announcement Lazard Capital Markets analyst Colin Sebastian suggested Best Buy’s move would likely expand the used games market “rather than take significant share” from the specialty channel.
“We estimate the size of the commercial used videogame market in the $2.5 billion range worldwide, continuing to grow, driven by major players including GameStop, Game Group (UK), Game Crazy, and internet marketplaces such as eBay and Amazon,” he said.
“While many videogame software publishers and console manufacturers view the used exchanges as cannibalising sales, we note that consumers use a large portion of trade-in credit to purchase new products.”
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Copyright 2006 - 2009 Future Publishing Limited, Beauford Court 30 Monmouth Street Bath, UK BA1 2BW
England and Wales company registration number 2008885
I have a standing prediction that how videogame publishers are handling the pre-owned issue, is going to lead directly to an industry crash for videogames at some point over the next five to ten years. And publishers' rush to a digital distribution system, without support for some sort of sub-system to allow the resale of game licenses by the consumer to other consumers, at prices set by the consumer (replicating how the free market works), is going to lead to said crash.
I've jotted some thoughts I have on the issue (for anyone who cares to read them). It is a rather lengthy read, and out of courtesy to the EDGE community, I posted them off site at this location .
Along with some observations I have made on the issue, I also posted what I think is a possible solution to solving the needs of the consumer, solving the needs of the publisher, all while avoiding an industry wide collapse.
If you have the time, please read my thoughts. Constructive feedback is always welcome.
No other industry I can think of bemoans used sales like the game industry does. Look at the used cars market for instance - a HUGE market, yet you don't see the industry spittiing out the dummy.
the music industry used to, until internet piracy made used CDs seem irrelevant. And i don't suppose it was ever as bad for music, as a CD isn't something you "finish".
Several Best Buy locations in VA have been buying used games for store credit for almost two years now, but they followed the Gamestop model rather than using kiosks.
I wonder if the fast sales of the Wii have affected the used games market. I refer to people buying into the "hardcore" consoles later in the round (due to owning a wii at the start of the round), and therefore having easy access to most of the AAA early titles for their consoles from used sections. I have bought a ps3 recently, and now own ~15 games (mostly the big ones), without having bought anything at all new.
Are used game sale figures (i.e. quantities, not specific games) listed anywhere?
You know there is the argument that used games actually helps the industry.
I've been gone all day - so maybe this is old news, but I don't know the argument.
What is it?
People trade in old games enabling them to buy brand new games. Without the credit from trade ins, these people would not buy anywhere near the amount of games they currently do.
I can't actually find the article right now, but last year, Gamestop gave out something like a billion in credit from trade ins obviously not all of that will go back to new games, since some people will buy pre-owned games with the proceeds, but you'd be surprised just how many people are extremely snotty about pre-owned, just after having traded in a load of their own stuff.
I don't need a link.
I was interested. I wasn't trying to "shoot holes" in your statements.
looks like more and more money eating away on them console sales :)
I wrote a blog last weekend about how retail wasn't doing publishers any favors.
Meet Appendix - 1
Publishers haven't been doing retail any favours for a long time. Retailers are only doing this to make gaming profitable for them.
I think we could do with another gaming crash like the 80's to get rid of some of the crap that's going on at the moment.