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Have supermarkets gone too far?

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FIFA is probably the only game that’s cheaper at launch than it is six months after release. The price cutting on the title is an annual ritual. But £25 is a terrifying new low. How long will it be before the title is given away free with a pack of loo roll? It makes you wonder how the likes of HMV and GAME can hope to compete.

Of course I bought my copy from Tesco. I’d have been a fool not too. Don’t shoot the messenger – loads of the getting-on-for-a-million other purchasers of the game will surely have done the same.

(It's worth pointing out here that I’d have paid another tenner – and I bet so would the vast majority of the new game’s record-breaking audience. I’m certain EA’s incredible development, sales and PR achievement would have existed regardless of supermarket naughtiness).

But the legacy of FIFA 10’s release isn’t all bad for the specialists. Loss-leading activities may boost market share, but it’s hardly an ideal way to build a successful video games business.

Also, the difference in cost between supermarkets and specialists is often minimal. This was an unsustainable one-off. For example, at launch Halo 3: ODST was cheaper at GAME than it was at Tesco.

And the supermarkets are far from perfect. On the day I picked up FIFA 10, Tesco had a poster outside with the incorrect price on it. They had no copies of the game on shelves and instead placed them all in a FSDU hidden away amongst the magazine section. You simply wouldn’t get that sloppiness at HMV, Blockbuster, GAME or Gamestation.

Nevertheless, ‘losing’ the FIFA launch weekend to the grocers will come as a significant blow to those looking to boost their sales in what has been a slow year – while publishers are seeing their triple-A titles devalue before their very eyes.

Who knows what might happen come the release of Pro Evolution Soccer, Assassin’s Creed or Modern Warfare 2?

It’s particularly interesting to see Pete Stone, boss of PES-publishing Konami, pleading for supermarkets to stop the price slashing on the cover of this week’s MCV. Despite conspiracy theories from indie stores and specialists littering MCVUK.com’s comments board this week , it appears – to a certain extent - the publishers really are on their side.

Supermarkets and publishers

posted by Play-uk Oct 13, 2009 at 12:16 pm
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The big problem is the publishers do not and can not dictate the price the game is sold at. They are in a catch 22 situation. Shift units and make money or don't. If the publishers were to insist the supermarkets sell at a certain price the supermarkets would not buy.

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posted by Ken Oct 14, 2009 at 10:02 am
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Ken

"If the publishers were to insist the supermarkets sell at a certain price the supermarkets would not buy"

Supermarkets not buying stock is not a bad thing, how about you let the game stores sell games and keep the retail value. Ok might take longer to sell the games but lets face it you are still going to sell the same amount and other people get to make money. Heres one for you Amazon are selling Forza 3 for £34.99 to buy this title from the official distributor will cost £33.19 ex vat! Whats that about!

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posted by ReVoRolla Oct 14, 2009 at 4:10 pm
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ReVoRolla

There has always been 2 sides to the gaming industry, those who make money and those who save money.

Developers, Distributors, Retaillers who want to make profit and Consumers who want value.

From a consumers point of view, for many years, the view was we are being ripped off with the high mark-up prices on games. Developers, Distrubitors and Retailers naturally want to make profit in their investment on games or what is the point. So something has to give with 2 sides constantly against each other.

Its only recently that the power has resided with the consumer where as before we were powerless in what we had to pay for games. Now we have the choice of what we deem is a fair price for a product.

Titles like FIFA and PES are tricky because of the perception of them for the consumer. Because a new version is released every year with the start of a new season, the consumer now knows those games do not hold any future value and therefore refuse to pay over the odds.

For example, the common PlayStation3 user, would only expect to see a ceiling price of £40 for any game. Anything higher than that scares them off immediately. An average retail price now for a consumer, is expected to be around £30 and something less than that is considered a bargain. Because as a consumer, we want value for money, sometimes we want to think we have invested in something rather than "just a game". Epic titles like CoD4, have kept their value due to the exceptional quality and longevity of the title. Even after 2 years of the original release, used copies on eBay are still selling above the £24 mark.

But titles like FIFA and PES are now considered by the consumer as simply as update disks from the previous title and not a "brand new" game. I personally bought PES2008 on the Playstation3 when it was released for £39.99, within 6 months, it was down to £24.99. When the 2009 version was due for release, you couldnt sell 2008 on ebay for a tenner. It was technically worthless. So these games now dont have a shelf life. Retailers know this and now the consumers know this and their buying habits is now reflecting this.

As for the supermarkets vs Game retailers, its always been about supply and demand. But now its supply, demand and value. And supermarkets are now using a reduction in game price to get customers in their doors, so they can buy in bulk with the likes of HMV, Play.com, Game etc but can offer lower prices because the possibilties the customer will buy other things in store when they are there.

As in everything, you have to adapt to survive and this is the challenge. In five years, with the technology at hand, customers wont have to leave their sofas to buy the game, they will download straight from the manufacturers, bypassing all the middle men. Its currently happening with the likes of PlaystationStore, where you can download a digital copy of Burnout Paradise for £20 and downloads extra content as time goes by so the game keeps its "shelf life". This will be the future and more of a threat than supermarkets.

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