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How GameStop Can Beat Online Passes

by TriplZer0   //   3:06 PM on 03.25.2012

I had an idea the other day about how GameStop could beat publishers at their own game. This isn’t fully fleshed out or anything, and who knows, it might be feasible at all. Well, here goes. Here’s how GameStop can beat online passes: they create a ReNewed games program.



Alright, let’s break down what this “ReNewed” pun actually means. We all know that GameStop is massively profitable enterprise. From their Q3 2011 earnings call, their pre-owned program grew by 3%. This was slower than the previous two quarters, but given the strength of the games that came out in October through December 2011, it makes sense that a lot of customers bought new.

From their 2010 earnings report, GameStop’s business goals included “expanding our sales of used video game products and capitalizing on the growth in demand [of used games]” and “[increasing] GameStop brand awareness and loyalty membership” which includes their PowerUp Rewards program. My proposed ReNew program would go hand in hand with those stated goals.

To counteract GameStop’s influence and the allure of used games, publishers have been utilizing online passes. Recent games like Batman: Arkham City, Kingdoms of Amalur: Reckoning, and others from publishers EA, THQ, Ubisoft have all had either singleplayer content or multiplayer modes locked behind online passes. Online passes force you to either buy the game new or purchase the pass separately on PSN or Xbox Live to access these locked away content nuggets.



On the surface these passes block GameStop from relying so heavily on used game sales because nobody wants to buy an incomplete game (and if you do, I don’t want to even know you). Well with ReNewed games, scrappy underdog (/sarcasm) GameStop can fight the power. Basically all they have to do is buy a bunch of the standalone online passes and bundle them with their used games.

How does this help GameStop with sales? Even though they buy the online passes for full price, they bundle them with the used copy of the game at a discount price. Say Awesome Game 2 has its multiplayer locked behind an online pass. The game is still retailing at $59.99. GameStop buys back used copies of the game from their customers for $14 and sells them for $30. That’s just the Pre-Owned copy of the game. If you want the ReNewed copy, it’ll cost you $38. Even though GameStop bought the pass for $10 and is selling it at a loss, the markup they put on used copies more than makes up for that.

By implementing some sort of program like this they can make it so people will still go to them for used copies even when a traditional used copy of that game needs an online pass.



Again, GameStop might already do something like this. I saw on their website they had a DLC section (but it was down so I couldn’t investigate it). Also another potential problem would be, how many codes do they download for each game that has an online pass? Obviously some games are going to sell more than others, and they wouldn’t want to get stuck with a bunch of online passes for games that consumers aren’t trading in or buying used.

I’m not saying this system is a good solution to the “used game problem” that publishers are always complaining about. Online passes and the fight against used game sales are both bullshit in my opinion. This is just a semi-sleazy tactic I could see GameStop implementing in the future. And if they do, customers are going to be the ones getting the shaft. Publishers will then try to come up with other ways to stop used games. Right now the situation is something of an arms race where the losers are average gamers who are just trying to save some money.Photo Photo Photo view gallery
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