GameStop Turnaround Strategy Analysis
Discover GameStop's journey from facing financial problems in a shifting industry to seeking the best strategy for a successful turnaround. Analyze internal and external factors, identify core competencies, challenges, and opportunities. The presentation outlines strengths, weaknesses, threats, and opportunities, aiming to position GameStop for a credible comeback story in the traditional retail and gaming sectors.
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GAME STOP: GAME STOP: GO E! GO E! PRESENTATION TO THE EXECUTIVE TEAM ORT CONSULTING GROUP ISMAEL ALMANDOS LUCIA BACIGALUPI JOANNA PELUFFO CLAUDIA RODRIGUEZ
SITUATION WHERE YOU ARE NOW WHERE YOU WANT TO BE TRADITIONAL MULTI-CHANNEL RETAILER TURNING A PROFIT ONCE AGAIN CREATING A CREDIBLE COMEBACK STORY FOR THE MARKET FINDING THE RIGHT WAY TO POSITION GAMESTOP IN THE INDUSTRY FACING FINANCIAL PROBLEMS PLACED IN DYNAMIC INDUSTRY THAT IS SHIFTING TOWARDS DIGITAL TRENDS (RETAIL & GAMING) ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
KEY QUESTION WHAT IS THE BEST STRATEGY FOR GAMESTOP TO EFFECT A SUCCESFULL TURNAROUND IN A DISRUPTED INDUSTRY? ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
INTERNAL ANALYSIS STRENGHTS WEAKNESSES LARGE AND ENGAGED COSTUMER BASE MULTI CHANNEL RETAILER RESELIANCE AND CAPACITY TO OVERCOME HARD CHALLENGES DIVERSIFIED PORTFOLIO WITH COLLECTIBLES ACTIVE ON SOCIAL MEDIA CHANNELS LARGE PHYSICAL PRESENCE NEGATIVE FINANCIAL RESULTS IN THE LAST YEAR LACK OF COSTUMER SEGMENTATION AND CUSTOMISATION LACK OF FOCUS ON WEBPAGE AND USE OF COSTUMER DATA ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
EXTERNAL ANALYSIS OPORTUNITIES THREATS STRONG COMPETITION FROM TRADITIONAL RETAILERS, DIGITAL STORES AND GAME PUBLISHERS RISE OF GAME DOWNLOADS SHIFT TO ONLINE RETAIL DECLINE IN MALL-ORIENTED FOOT TRAFFIC RISE OF ONLINE GAMING AND E- SPORTS COMMUNITIES RISE OF ONLINE STREAMING SITES RISING TREND OF GAMMING AS A COMMUNITY ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
CORE COMPETENCIES LARGE AND ENGAGED CUSTOMER BASE (40M POWERUP) STRONG BRAND IMAGE ASSOCIATED WITH GAMING STRONG OPERATIONS KNOWLEDGE INDUSTRY KNOW-HOW ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
CHALLENGES RETAIL AND VIDEO GAME INDUSTRY SHIFT FROM PHYSICAL TO ONLINE REDUCTION OF IN- STORE TRAFFIC DIFFERENTIATE FROM COMPETITION TURN A PROFIT AGAIN ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
ALTERNATIVES AND ALTERNATIVES AND RECOMMENDATION RECOMMENDATION ORT CONSULTING GROUP ISMAEL ALMANDOS LUCIA BACIGALUPI JOANNA PELUFFO CLAUDIA RODRIGUEZ
ALTERNATIVES EXPAND TO THE LATIN AMERICAN MARKET AND LEVERAGE EXISTING GAMING COMUNITIES INCORPORATE A NEW LINE OF PRODUCTS WITH BOARD GAMES REVENUE SHARE AGREEMENTS WITH INDEPENDENT GAME PUBLISHERS FOCUS ON E-SPORTS ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
ALTERNATIVES EXPAND WITH CURRENT BUSINESS MODEL LEVERAGE A MARKET THAT IS CURRENTLY UNATTENDED EXPAND TO THE LATIN AMERICAN MARKET AND LEVERAGE EXISTING GAMING COMUNITIES GAMING INDUSTRY IS EXPANDING IN LATIN AMERICA (LARGE GAMING COMMUNITIES) START IN THE LARGETS MARKETS: MEXICO, BRAZIL AND ARGENTINA ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
ALTERNATIVES LEVERAGE LARGE CUSTOMER BASE HOST BETA TESTS AT STORES (PRE LAUNCH TRIALS) REVENUE SHARE AGREEMENTS WITH INDEPENDENT GAME PUBLISHERS HOST LAUNCH EVENTS IN GAMESTOP STORES HOST GAMING NIGHTS TO PROMOTE NEW GAMES MAKE AGREEMENTS TO FEATURE IN-GAME AND RECEIVE A PORCENTAGE OF IN-GAME PURCHASES ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
ALTERNATIVES LEVERAGE INDUSTRY PIVOT TOWARDS ONLINE GAMING AND E- SPORTS CREATE GAMESTOP S OWN LEAGUE (IN LATIN AMERICA) SET UP LARGE TOURNAMENTS IN LATIN AMERICA FOCUS ON E-SPORTS GAMESTOP EXPERIENCE IN NORTH AMERICA AND EUROPE HOST SMALL MORE LOCAL MATCHES IN NORTH AMERICA AND EUROPE CHARGING SUBSCRIPTION FEES HOST TOURNAMENTS AND ALLOW GAMERS TO PRACTICE IN STORES LEVERAGE E-SPORTS COMMUNITY ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
ALTERNATIVES LEVERAGE THE RISE OF BOARD GAMING DIVERSIFY PRODUCT PORTFOLIO LEVERAGE THE BRAND S ASSOCIATION WITH THE GAMING INDUSTRY INCORPORATE A NEW LINE OF PRODUCTS WITH BOARD GAMES LAUNCH GAME PLAYING EVENTS IN STORES TO PROMOTE COMMUNITY GAMING ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
ALTERNATIVES EXPAND TO THE LATIN AMERICAN MARKET AND LEVERAGE EXISTING GAMING COMUNITIES INCORPORATE A NEW LINE OF PRODUCTS WITH BOARD GAMES REVENUE SHARE AGREEMENTS WITH INDEPENDENT GAME PUBLISHERS FOCUS ON E-SPORTS ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
ALTERNATIVES EXPAND TO THE LATIN AMERICAN MARKET AND LEVERAGE EXISTING GAMING COMUNITIES INCORPORATE A NEW LINE OF PRODUCTS WITH BOARD GAMES REVENUE SHARE AGREEMENTS WITH INDEPENDENT GANME PUBLISHERS FOCUS ON E-SPORTS PROBLEM SOLUTION FIT PROFITABILITY (SHORT TERM) FEASIBILITY (WITH CURRENT CAPABILITIES) RISK OF IMPLEMENTATION AGILITY OF IMPLEMENTATION ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
ALTERNATIVES EXPAND TO THE LATIN AMERICAN MARKET AND LEVERAGE EXISTING GAMING COMUNITIES INCORPORATE A NEW LINE OF PRODUCTS WITH BOARD GAMES REVENUE SHARE AGREEMENTS WITH INDEPENDENT GANME PUBLISHERS FOCUS ON E-SPORTS PROBLEM SOLUTION FIT ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
ALTERNATIVES EXPAND TO THE LATIN AMERICAN MARKET AND LEVERAGE EXISTING GAMING COMUNITIES INCORPORATE A NEW LINE OF PRODUCTS WITH BOARD GAMES REVENUE SHARE AGREEMENTS WITH INDEPENDENT GANME PUBLISHERS FOCUS ON E-SPORTS PROBLEM SOLUTION FIT PROFITABILITY (SHORT TERM) ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
ALTERNATIVES EXPAND TO THE LATIN AMERICAN MARKET AND LEVERAGE EXISTING GAMING COMUNITIES INCORPORATE A NEW LINE OF PRODUCTS WITH BOARD GAMES REVENUE SHARE AGREEMENTS WITH INDEPENDENT GANME PUBLISHERS FOCUS ON E-SPORTS PROBLEM SOLUTION FIT PROFITABILITY (SHORT TERM) FEASIBILITY (WITH CURRENT CAPABILITIES) ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
ALTERNATIVES EXPAND TO THE LATIN AMERICAN MARKET AND LEVERAGE EXISTING GAMING COMUNITIES INCORPORATE A NEW LINE OF PRODUCTS WITH BOARD GAMES REVENUE SHARE AGREEMENTS WITH INDEPENDENT GANME PUBLISHERS FOCUS ON E-SPORTS PROBLEM SOLUTION FIT PROFITABILITY (SHORT TERM) FEASIBILITY (WITH CURRENT CAPABILITIES) RISK OF IMPLEMENTATION ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
ALTERNATIVES EXPAND TO THE LATIN AMERICAN MARKET AND LEVERAGE EXISTING GAMING COMUNITIES INCORPORATE A NEW LINE OF PRODUCTS WITH BOARD GAMES REVENUE SHARE AGREEMENTS WITH INDEPENDENT GANME PUBLISHERS FOCUS ON E-SPORTS PROBLEM SOLUTION FIT PROFITABILITY (SHORT TERM) FEASIBILITY (WITH CURRENT CAPABILITIES) RISK OF IMPLEMENTATION AGILITY OF IMPLEMENTATION ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
ALTERNATIVES EXPAND TO THE LATIN AMERICAN MARKET AND LEVERAGE EXISTING GAMING COMUNITIES INCORPORATE A NEW LINE OF PRODUCTS WITH BOARD GAMES REVENUE SHARE AGREEMENTS WITH INDEPENDENT GANME PUBLISHERS FOCUS ON E-SPORTS PROBLEM SOLUTION FIT PROFITABILITY (SHORT TERM) FEASIBILITY (WITH CURRENT CAPABILITIES) RISK OF IMPLEMENTATION AGILITY OF IMPLEMENTATION ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
RECOMMENDATION FOCUS ON PROMOTING THE E-SPORTS COMMUNITY BY LEVERAGING GAMESTOP S BRAND IMAGE AND CLIENT BASE ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
WHY WE CHOSE THIS OPTION RETAIL AND VIDEO GAME INDUSTRY SHIFT FROM PHYSICAL TO ONLINE REDUCTION OF IN- STORE TRAFFIC DIFFERENTIATE FROM COMPETITION TURN A PROFIT AGAIN ANSWER CLIENTS DESIRE FOR ONLINE GAMING ATTRACT CLIENTS THROUGH EVENTS AND CREATING COMMUNITY PROVIDE A DIFFERENTIATED EXPERIENCE GAIN NEW REVENUE STREAMS ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
IMPLEMENTATION IMPLEMENTATION
IMPLEMENTATION SMALL LOCAL CLUBS STRATEGY WORLDWIDE TO LEVERAGE CURRENT STORES OWN LEAGUE IN LATAM WITH BIG STADIUM EVENTS ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
IMPLEMENTATION OPERATIONS MARKETING TECH ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
IMPLEMENTATION REMODEL 1000 STORES TO CLUB MODEL REBRAND TO GSE Clubs BY GAMESTOP OFFER MONTHLY SUSCRIPTION FOR ACCESS TO GSE Clubs ASSOCIATION WITH STARBUCKS PARTNERSHIP WITH NVIDIA POWERDED BY NVIDIA CREATE LOGISTICS TEAM FOR LATAM GENERATE AGREEMENT WITH VIDEOGAME MAKER TO CONDUCT LAUNCHING EVENTS IN CLUBS GENERATE AGREEMENTS WITH VIDEOGAME MAKERS FOR LATAM Fifa League of legends Minecraft Call of Duty OPERATIONS ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
IMPLEMENTATION REVAMP POWER-UP REWARD PROGRAM SEGMENT CUSTOMERS USING DATA SCIENCE OFFER REWARD POINTS ASSOCIATED WITH STARBUCKS RELAUNCH WEB PAGE COMPLETELY NEW NEW E-COMMERCE INCLUDE DIGITAL SUSCRIPTION TO PHYSICAL GSE STORES E-MARKETING CAMPAING GOOGLE ADDS SOCIAL NETWORKS INFLUENCERS MARKETING ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
IMPLEMENTATION AQUIRE COMPANY SPECIALIZED IN DATA SCIENCE LAUNCH NEW APP TO FOLLOW SCORES AND GENERATE COMMUNITY NEW WEBPAGE BIG DATA, AND MACHINE LEARNING TO SEGMENT CUSTOMERS STREAM CONTENT THROUGH ESTABLISHED CHANNELS TECH SUPPORT TO SUSCRIPTION PROGRAM TECH ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
GANTT Q1 Q2 Q3 Q4 YEAR 2 YEAR 3 YEAR 4 YEAR 5 OPERATIONS DATA SCIENCE COMPANY ACQUISITION REFURBISH 1000 STORES BUILD LOGISTICS TEAM MARKETING REVAMP POWER UP REWARDS SEGMENT CUSTOMERS MARKETING CAMPAIGN TECHNOLOGY DEVELOP GSE APP RELAUNCH WEB ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
FINANCIAL ANALYSIS FINANCIAL ANALYSIS
ASSUMPTIONS TAXES 25% FINANCING RATE 6% LOAN $ 400 INFLATION 5% LATAM INFLATION 8% NWC 10% ALL NUMBERS IN MILLIONS ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
PROJECTIONS WORLDWIDE SUSCRIPTION COMPOUND GROWTH RATE 15% LATAM MARKET COMPOUND GROWTH 15% ALL NUMBERS IN MILLIONS ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
PROJECT HIGHLIGHTS IRR 23% NPV $ 60,39 ALL NUMBERS IN MILLIONS ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
PRICING SUCRIPTION MONTHLY FEE USD 19.99 ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
MAIN COST DRIVERS ALL NUMBERS IN THOUSANDS OF US DOLLARS CASH FLOW IS AVAILABLE IN ANNEX ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
MAIN SOURCES OF INCOME ALL NUMBERS IN THOUSANDS OF US DOLLARS CASH FLOW IS AVAILABLE IN ANNEX ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
MAIN SOURCES OF INCOME ALL NUMBERS IN THOUSANDS OF US DOLLARS CASH FLOW IS AVAILABLE IN ANNEX ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
WHAT IF WORLDWIDE SUSCRIPTION COMPOUND GROWTH RATE 5% LATAM MARKET GROWTH 5% ALL NUMBERS IN MILLIONS ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
PROJECT HIGHLIGHTS IRR 6% NPV $ - 200 ALL NUMBERS IN MILLIONS ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
RISKS AND MITIGATION RISK MITIGATION LATAM MARKET VULNERABILITY FIRST BRAZIL AND MEXICO NVIDIA PARTNERSHIP DOES NOT COME THROUGH GO WITH AMD ANALYSIS ALTERNATIVES IMPLEMENTATION FINANCIALS RISKS RECOMMENDATION
CONCLUSIONS WHERE YOU ARE NOW WHERE YOU WANT TO BE TRADITIONAL MULTI-CHANNEL RETAILER TURNING A PROFIT ONCE AGAIN CREATING A SOLID STRATEGIC FOUNDATION FOR THE NEW FUTURE FINDING THE RIGHT WAY TO POSITION GAMESTOP IN THE INDUSTRY FACING FINANCIAL PROBLEMS PLACED IN DYNAMIC INDUSTRY THAT IS SHIFTING TOWARDS DIGITAL TRENDS FOCUS ON PROMOTING THE E-SPORTS COMMUNITY BY LEVERAGING GAMESTOP S BRAND IMAGE AND CLIENT BASE
THANK YOU! THANK YOU! WE NOW WELCOME ANY QUESTION YOU MAY HAVE WE NOW WELCOME ANY QUESTION YOU MAY HAVE ORT CONSULTING GROUP ISMAEL ALMANDOS LUCIA BACIGALUPI JOANNA PELUFFO CLAUDIA RODRIGUEZ
CASH FLOW 0 1 2 3 4 5 Inc in sales Inc in Costs Inc in interests Inc in Taxable income Inc in Taxes Inc in NWC Recovery of NWC Inc in Net income $ (526.80) $ - 440.00 $ (309.44) $ 506.00 $ (317.47) $ 581.90 (325.91) $ $ 669.19 (334.77) $ $ 769.56 (344.09) $ $ -24 -24 -24 -24 -24 -24 (550.80) $ (137.70) $ $ 106.56 $ 26.64 $ (44.00) $ 164.53 $ 41.13 $ (50.60) $ 231.99 58.00 (58.19) $ $ $ 310.41 77.60 (66.92) $ $ $ $ $ $ 219.71 $ 721.55 $ 401.48 100.37 - - (688.50) $ $ 89.20 155.06 $ $ 231.80 $ 321.09
DATA Loan Financing rate RRR Tax NWC No of stores Current Revenue 400 6% 20% 25% 10% 5830 $ 9,000.00 2008 63 2014 53 2019 Stock Price 5 No. of full time employees Pre owned 16000 22.50% SQFT $/SQFT Revenue per store Total Revenue of stores No of stores to reconvert cost per reconvert store Total costo of reconversion Inflation Inc. in operation costs Latam team Latam team cost per person per year Total cost of Latam tema Latam inflation 1700 0.66 $ $ 6,511,527.00 $ 1,116.90 1000 0.025 25 5% 100 60 0.03 1.8 8% Suscription growth rate Monthly suscription fee Number of suscriptors Revenue per suscription Inc. in sales of other products Inc in sales GSE Latam revenue 15% 0.00024 0 1 2 3 4 5 0.00 - 1,500,000.00 360.00 $ $ $ 1,725,000.00 414.00 $ $ $ 1,983,750.00 476.10 $ $ $ 2,281,312.50 547.52 $ $ $ 2,623,509.38 629.64 $ $ $ $ 30.00 390.00 34.50 448.50 39.68 515.78 45.63 593.14 52.47 682.11 $ - 15%
