Did Gamestop Grow a Heart?
Gamestop, a store known for ripping off customers with its ridiculously low trade-in values, has reportedly increased them. Some of these increases are significant, doubling from the old trade-in value and even allowing some savvy shoppers to make a profit off of their trade-in games (if they buy used copies from other sources). Although the deal is temporary, it seems to indicate that Gamestop has finally listened to customer opinions and greatly changed its trade-in value to accommodate customers. It’s possible this is just a testing phase to see how much profit they can still generate—but the far more likely answer is much more disappointing. The company has not grown a heart; it is just attempting to stay relevant as other electronics stores crowd in on its niche market.
If this ends up being a more permanent offer, then my point is invalid; However, I can say with certainty that these high prices aren’t around to stay. With inflation comes raised prices and raised rewards for trade-in customers, but Gamestop has always made its profit through generating money off of old games. By buying games incredibly cheap (roughly 25% of their new price), they stand to make a huge amount of profit. Despite this tactic, the company has been in a slump, and their game prices are already too low to lower any more. Their trade-ins have petered out…could it be because customers are turning away from the company after years of bad ethics? No, probably not. Best Buy is just a better choice for customers who want to make money off of their games, and the petering Gamestop sales are an indication of this.
Best Buy has always offered high prices for trade-in games—generally higher than Gamestop. This tactic has cut straight into Gamestop’s strategy, making an uncharacteristic holiday sales slump. By raising its trade-in prices, Gamestop encourages gamers to come to their store to trade-in and buy new games, skipping Best Buy entirely. While Best Buy still has pretty good trade-in prices compared to Gamestop, the buzz generated by Gamestop’s new trade-in prices should be just enough to increase their sales slump and give them a positive outlook this holiday season.
It would be nice if this period of high trade-in values wasn’t a phase—but the company will probably resume its older prices on December 16th, once it’s back on the radar for holiday shoppers. Ultimately Gamestop is a company at heart, and while that’s necessarily a bad thing, the increase of its trade-in value is not an indication that the company is finally on a good path. What it would have to do at this point in the company’s lifetime to recover its integrity is a mystery—but it would have to be something more extravagant than trying to stay relevant as Best Buy steals its customers out of pure respect for them. With plenty of competition in both the form of online retailers and mortar-and-brick stores, Gamestop has a lot to fix if it wants to stay relevant. These prices are just an indication of that.