GameStop's Future Strategy for Industry Domination
Explore GameStop's position in the changing video game industry, its strengths, weaknesses, opportunities, and threats. Discover potential strategies such as merging with competitors and focusing on online experiences to ensure a successful future.
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Presentation Transcript
GAMESTOP: A NEW LEASE ON LIFE, OR GAME OVER? NYENRODE BUSINESS UNIVERSITY KOEN BOUWMEESTER | YANNICK FRYTERS | GOVIND MALLUWAR | JESPER MENTINK
1. What relevance does GameStop posses? 2. What future strategy should GameStop execute in order to conquer the changing industry?
What is happening around us? 1. Consumer behavior shift 1. Physical vs. digital 2. Experiences 2. Demographical change 3. Increase of console sales 4. Streaming websites Risks & Mitigations Analysis Alternatives Solution Implementation Financials
Strengths Weaknesses Opportunities Threats Brand name Lack big data analytics Community Competition Collectible market Online presence/Locations Tournaments/eSports Digitalization Engaged customer base Console Sales Streaming websites Online Streaming Revenue streams Big data analytics Management Reward program Marketing Risks & Mitigations Analysis Alternatives Solution Implementation Financials
2. What future strategy should GameStop execute in order to conquer the changing industry? Risks & Mitigations Analysis Alternatives Solution Implementation Financials
Alternative 1: Merging with download site Alternative 2: Merge with competitor Alternative 3: GameStop X What? Experience centers What? Merging with e.g., Steam What? Merging with e.g., BestBuy Why? Branding Community In line with current business eSports Why? Huge online potential Need for online presence Leveraging BD Why? In line with current business model & expertise Diversification of products & markets Risks & Mitigations Analysis Alternatives Solution Implementation Financials
Online Community Reward program Console sales eSports Scalability Merging with download site Merging with competitor GameStop X Risks & Mitigations Analysis Alternatives Solution Implementation Financials
Alternative 1: Merging with download site Alternative 2: Merge with competitor Alternative 3: GameStop X What? Experience centers What? Merging with e.g., Steam What? Merging with e.g., BestBuy Why? Branding Community In line with current business eSports Why? Huge online potential Need for online presence Leveraging BD Why? In line with current business model & expertise Diversification of products & markets Risks & Mitigations Analysis Alternatives Solution Implementation Financials
GameStop X Community Building phenomenon Sell of used consoles Experiential buying Online streaming Lack of segmentation Risks & Mitigations Analysis Alternatives Solution Implementation Financials
Game Stop X 1. A complete make over of the shop 2. An experience center where customers can walk in 3. Gaming arena in the store 4. Live broadcasting of game competitions (Eg. YouTube) 5. Exclusive game competitions for loyal customers (Eg. Influencers) Risks & Mitigations Analysis Alternatives Solution Implementation Financials
What will the store look like? Collectibles Sale of new consoles Gaming arena Sale of old consoles Risks & Mitigations Analysis Alternatives Solution Implementation Financials
Did Community Building phenomenon Sell of used consoles Experiential buying Online streaming Lack of segmentation Risks & Mitigations Analysis Alternatives Solution Implementation Financials
Identify geographical area for pilot (2 months) Identify stores to renovate (1 month) Conduct pilot (6 months) Learn from pilot (2 months) Build business case (2 months) Risks & Mitigations Analysis Alternatives Solution Implementation Financials
Understand legal complications (Emp) (2 months) Understand legal complications (Contracts) (2 months) Identify capabilities (2 months) Find partners (4 months) Hiring talent (4 months) Roll out Risks & Mitigations Analysis Alternatives Solution Implementation Financials
Earnings Costs Ongoing: Ongoing: 50% reduction in stores Double Supply Chain Investments Influencers: $ 5,000,000 50% reduction of in-store inventory One-time: Layoff part-timers: Re-furnish stores: Re-education: $ 60,000,000 $ 30,000,000 $ 2,000,000 Risks & Mitigations Analysis Alternatives Solution Implementation Financials
Scenario Currently Forecasted Sales $ 8,547.00 $ 8,547.00 Cost of Sales $ 6,062.00 $ 6,062.00 Gross Profit $ 2,485.00 $ 2,485.00 SGA $ 1,909.00 $ 1,527.20 Depreciation $ 122.00 $ 97.60 Goodwill $ - $ - Asset Impairments $ 13.80 $ 13.80 Operating (Loss) Earnings $ 440.20 $ 852.20 Increase $ 412.00 Investments $ 100.00 Risks & Mitigations Analysis Alternatives Solution Implementation Financials
Risks of GameStop X Risks of no GameStop X Employee Morale No anticipation on change in consumer behavior Online community Streaming websites eSports Pivot Business from Products to Products & Services Decrease of brand awareness Risk of Bankruptcy Risks & Mitigations Analysis Alternatives Solution Implementation Financials
