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How is GameStop surviving the world that's killing GAME?

Michael French
How is GameStop surviving the world that's killing GAME?

It's a question many have asked over the last 18 months - and today GameStop offered some insight.

GameStop has managed to make billions in revenue every quarter for the last three years plus - with its latest figures showing just a 3% quarterly downtown. While as we know GAME has been less fortunate in recent months.

During its year-end financials call today, one analyst asked directly what the firm was doing versus the situation with GAME.

While GameStop bosses dodged the question directly (understandably - the firm may never move on the in-administration retailer, despite conventional wisdom that it is interested) but did offer comments about its own business.

EVP of international Mike Mauler said the firm has done well in markets where others have struggled because of a focus on three main areas.

"A strong focus on tactics," was the first: "managing inventory, staying true to our buy-sell-trade product offering and outstanding customers service".

"Secondly we moved to stay head of the curve in terms of structuring to keep costs under control."

That remark was a reference to its closing stores in Northern Ireland, UK and Portugal that it is presumed have been under performing, while centralising other parts of the business.

In Northern Europe it is consolidation operations into one base in Dublin, Ireland, that will share resources for stores and online retail, creating a "centre of excellence".  That helped the plan for the UK, Mauler added, where the firm is "focused entirely on competing digitally".

The third area was "building a strong foundation for strategic initiatives" specifically the global expansion of the Power Up rewards loyalty in other countries.

Mauler said that after learning in the US how to roll out reward schemes quick, the International take up has been swift, with Power Up having 1,000 members per store in Australia after just one week live.

He also added, and this would be a bittersweet remark for anyone at GAME, that GameStop's strength came in with "partnering with publishers for big exclusives" - and, as we know, publisher support is something that has been lacking for the UK's biggest specialist retailer in recent months.

Mauler also offered some breakout figures for International and EU performance.

GameStop made $70.6m income in Europe during the last quarter - 3.5 per cent up on the previously year.

The firm also saw strong growth across Europe in pre-owned games sales.

Plus, with online and digital such a huge priority for GameStop, the firm has seen growth in those areas - with international ecommerce for the quarter up 36 per cent too.

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Tags: GAME , gamestop

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