Weekend Reading: Goozex or Goosex? Hot game trading action inside!

Sounds promising, doesn’t it? Well, this week, I’ve sat down with Mark Nebesky, one of the co-founders, and the CMO of Goozex, Inc. For those of you that don’t know, Goozex is a game-trading site that’s been around since last year. Gaining popularity at Cheap Ass Gamer, some of the Destructoid editors have hopped on the bandwagon and joined this site.

To give a quick rundown before the interview begins, the system works like this: you list up a game on Goozex that you have in your collection (in either disc only, disc and manual, or full game quality), and then you get matched with another user on the site. The system will then deduct the points from one person’s account, and then you ship out the game. Once the other person recieves it, then you get the points for that game, which you can then spend on purchasing other games. Goozex makes its money by charging $1 for every trade from the buyer.

Anyways, let’s get into the interview, and be sure to check out the site. If you’ve got any questions about the system, there are a few Goozexers on the site, or there’s always the Goozex forums, if you want to meet the trading community.

First off, how the hell did you come up with a name like “Goozex” for the site?

After millions poured into market research and surveys, highly paid consultants gave us two options: 1. xbryy  2. uuddllrrabab — we thought about it, and went with Goozex. We somehow figure it’s a fun way to mix together Goods Exchanged.

Goozex has recently celebrated its one year anniversary. What sort of ground have you guys covered in that amount of time?

A lot! When we first started, we were a disc only operation covering PS1, Dreamcast, Xbox, PS2 and GameCube. We only had a few members in the Washington D.C. area, too. Today, we cover 13 different platforms, including PC games. We’ve got all members in all 50 states and all Canadian provinces trading on multiple levels, and have over 6,000 unique titles available.

What’s been the most fun has been the friends we’ve made in the industry including Destructoid, CAG, and more. Oh, and we’ve seen members exchange 5 million points between each other, saving about a quarter of million dollars when all added up.

Compared to what, the retail value of the games new?

No. In our calculation we used an average used price of $20.

You guys are in direct competition with the used games market of GameStop and other brick and mortar retailers. Have you noticed any sort of feedback, either from users or from some companies, about your service versus theirs?

Yes, from a few companies, and big yes from our members. A lot of unprovoked responses are fired against GameStop and their used game market practices. I’d like to say that on a business level, GameStop is an excellent company that knows how to turn a low margin product, ie video games, into a high margin profit driving cash cow. However, many of our members are their former customers vowing never to return. 

The whole idea behind Goozex started when the Jon Dugan, Goozex Founder, went into a Gamestop to trade in 17 used titles. He received $34 in store credit. The next day he went back with his brother and saw a lot of his games on the shelf selling for a minimum of $20 each. He felt extremely ripped off and started to draw up the plans that is now Goozex.

Where do you see the majority of your trades happening? In the older PS1, Dreamcast, etc group, the last gen of systems, or mostly within this current gen (PS3/360/Wii)?

PC titles. We are really filling a void in the marketplace for used PC games. A close second are PS2 games followed by Xbox 360. The next-gen titles are trading a better rate as the market keeps growing with new console sales… understandably, PS3 is not the highest traded.

That’s really unfortunate for me. I look to Goozex for cheaper PS3 games, but they’re only $10 below retail price right now. So, you guys have the Goozex Guarantee on your site as a protection against any problems that occur on the trading end, trying to make users feel safer. How often have you actually had to implement that policy?

We have a very low negative feedback ratio to total trades.  It is currently below 4%.  Our neutral feedback ratio is below 1%. We watch those very closely because the gamer’s trust is a hard thing to earn. We have internal alarms notifying us of malicious users on both sides of the trade and we act swiftly, when necessary.

So, how’s your retention rate for members?

We know one thing: many of our members are repeat traders. Those that start trading, generally speaking, don’t stop after one trade. So the retention rate on members that have started one trade is very high. Across the board our trading growth is nearly double our user growth showing repeat trades. We have members that have traded in the hundreds. 

So, what are some of the plans that you guys have in the works to keep the members there?

We’ve got a few big ideas. One is that we’re building apps for them use and express themselves like our Goozex signature, which displays up to four network identities and their latest received games. Another, which will launch soon is a flash application for Myspace members to use and share their video game library. We have more in alpha and beta stages. We also run organized events on our forums to build that stronger sense of community like Destructoid does with theirs.  In fact, Destructoid is a very good site to see how to build an engaged and loyal community. Most importantly is that we listen to our members and build the site to their specifications. Almost all the big site developments in the past year have been as a result of our members asking us to do them.

When can we expect to see cartridge games on the site?

That is a common question — it depends on a few things. What it takes on our end to add them is we bring in our game content from the Muze database. The second thing we need to do is be able to price them properly. There are a lot of rare games with high prices when you go retro, so we need to be prepared for that, otherwise we start to lose that trust factor. Finally, we need to actually build that into the site. We’ve never been oppossed to retro game trading, and it has always been an issue of website development.

One section of audiences that’s a hard market for you are the collectors. How do you try and attract those who don’t normally trade off a game when they’re done with it?

I think in the gaming world, everything starts with the hardcore gamer, who is often times a collector. We started and stil do today, and will moving forward, attract them by showing up in their communities. CAG and GameTZ are great hardcore gaming communities. Next, we have to listen to their inputs after they start trading with us. I’d say nearly all our early members are hardcore collectors and a lot of the site changes is due to their input like the Matrix Match. And the 100% guarantee on all trades is another great way to market to them. Making friends with the hardcore gamer is frankly the only to win in the game trading world.

If they don’t want to give up their games, they can just buy points. Is there much worry about an influx of points flooding the market?

We do monitor our point system in a macro economic type of way and watch for inflation. To address any type of run-on-the-bank situation we are developing plans to extend the value of the Goozex points. This is the only realistic direction to go with Goozex points and we’re lining up some great opportunities. 

By extend the value, you mean increasing the point limit that a game can go up to?

No. I mean by go beyond the current use of Goozex points. Game trading is our core and we want to work around that and give our members some new exciting features that compliment getting a copy of Dead Rising.

Will it go as far as offering consoles up for trade?

I doubt consoles because of pricing and quality issues. 

So, with some of the industry looking down on you, what sort of participation would you like to see from game companies?

We have met with a few publishers that are interested in working with us on a various levels.  The level depends really on how we fit their needs and future strategy. But overall, I’d like game companies to approach us for a different way to look at their product line up. In the end, our members are their customers and in order to trade on Goozex, the game must have been purchased retail somewhere. We know how to provide a different perspective on the product life cycle and branding. I’d say game life cycles are longer once they hit Goozex because other people are getting introduced to titles that otherwise they didn’t purchase because of the naturally high price points.

For those of you who want to sign up, use the coupon Destructoid-2007. You’ll get 5 free trades, and a bonus 100 points after your first positive feedback from a trade. As Mark said, “a free Bargain Bin Laden game on us.”