GameStop has announced a program that will allow gamers to pick up a copy of Haze for the PS3 free. That is, it will be free for a week if gamers pre-order the game through GameStop. This strategy, which amounts to a rental program, has a number of advantages for GameStop.
Scheduled to be published by Ubisoft in May, Haze is a first person shooter that explores dark themes such as drug abuse, so it isn’t necessarily a game that will sell out of the starting gate without more marketing buzz. Offering the game for free, even for a week, makes it more likely that gamers will put their hard-earned cash onto the counter at their local GameStop for a title with only intermittent buzz. It will be coming out only three weeks after the launch of GTA IV, and that multi-platform release will overshadow many M-rated games for weeks.
What happens for GameStop if a number of consumers return their copies of Haze? All of those consumers then receive a “refund” of in-store credit. This really is not a refund in any way, since GameStop still has the consumer’s money. In an ideal world, from GameStop’s perspective, that consumer then forgets about their in-store credit and essentially gives them $60 without any change in stock. Not a bad way to run a business. Even if they do use their in-store credit, they’re just buying another game from GameStop. That pre-order slip becomes nothing more than a promissory note for the value of one new PS3 video game. No matter what, GameStop comes out ahead.
Then, if the consumer chooses to buy a used video game, GameStop will be able to reap an even greater profit off the original “sale,” as I discussed here. The margin on new video games is much smaller than the margin on used games for a retailer like GameStop. Any consumer who returns Haze and then purchases a used game will be contributing directly to the retailer’s bottom line rather than the developer or publisher’s bottom line. While there are benefits for Ubisoft and Free Radical Designer, the developer, the company most likely to see better revenue as a result of this initiative is GameStop.
Once those copies of Haze are returned, they will go right into the used games shelf. GameStop will already have the money to cover the cost of the original game, at least until the consumer decides to spend it in the store, so they can sell it off as a used game with an even better profit margin.
As I pointed out in my article discussing the impact of used games in a slumping economy, though, few gamers worry over which large corporation is taking their money. If they can get the video game they want uses for less money, they will take that option. Furthermore, if they can try a game free for a week without committing their money to that game alone, they will likely take that option. This is a savvy move by GameStop, and I wouldn’t be surprised if the company expanded the initiative to include other games with low profiles.
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