High Street highs

With all the gloom surrounding the UK economy currently, how has GAME emerged unscathed again?

If we look at the facts, we have a really buoyant industry with five successful current-gen machines in the being driven by some very innovative products. The installed base today and the growth we’ve seen this year to date is quite phenomenal and it puts us in a great place as we approach Christmas.

ChartTrack are reporting something like 17.3 million third generation consoles sold now, so taking this installed base together with the products that we have in the pipeline – big franchises and sequels, new IP and new interactive family titles and you can’t help but get excited about the fourth quarter.

Do you think the number of Q4 releases will create problems?

To us as the leading specialist, range and choice is a key differentiator – we have the opportunity to range more games in our stores than most. We want to be there offering consumers the broadest range on the High Street. We fully encourage there being a broad selection of titles available over Christmas.

What would be your pick for the biggest-selling titles this Christmas?

It’s difficult, I think there is a great and varied line-up – great sequels in the guise of FIFA ’09, Need For Speed, Call Of Duty, Pro Evo plus Tomb Raider that we feel will do incredibly well and then we’ve got Gears Of War 2, the response to this title at our recent managers conference was quite phenomenal and I’m sure we’ll get the same reaction from our 360 owners.

New franchises such as Mirror’s Edge could be very exciting and there are the family titles like LEGO Batman which we think will be fantastic. Wii Music and Guitar Hero also offer great entertainment as well as my favourite genre karaoke titles, with High School Musical, Lips from Microsoft and SingStar Abba on PS3, all making great Christmas presents.

Where do you stand on the issue of price cutting?

We’re very clear as to our strategy. We recognise that in any market – and probably now more so than ever – that you have got to offer value for money for your consumers. We recognise that the UK is very competitive, but it’s been competitive for a number of years now, so we have to prepare ourselves to operate in this environment.

Unlike many of our competitors, we believe that we’ve got a number of tools with which we compete. It’s not just about price for us, it’s about range, which is absolutely key, and availability of product. It’s about service and having knowledgeable teams in our stores.

Our trade-in programme allows consumers to use their existing games as currency and let’s them to buy more games more frequently. And there’s our GAME Reward Card where our consumers can earn points to redeem as discount against new purchases.

It’s also about offers and promotions and we work really hard with our suppliers on getting great offers for our customers such as deals of the week.

We monitor the competition – we have to – we look at our weekly price check reports and we look at our market share but I have to say that I feel we’ve got a good strategy, we’re the leading specialist in the market and we’ve got to focus on what we do.

Another issue that seems to raise hackles is the pre-owned market – has there been any tension between GAME Group and its suppliers of late?

Not really. I think our suppliers have been absolutely fantastic in helping us to build what is looking like a very exciting Christmas campaign and I would say that we’re really pleased with where we are. We’ve got some fantastic partners and we look forward to selling lots of their products in the final quarter.

There is always mention of further international expansion in your financials – is this a key battleground for GAME Group?

I think we’ve been very clear that international growth is a key focus for us. If we look at the store base we have something like 1,300 stores across the Group trading by Christmas and around 46 per cent of those stores will be outside of the UK.

We plan further expansion in our key markets – in Spain, Australia and France and we have announced our entry in the Czech Republic.

We will continue to review other markets as appropriate, markets and opportunities that meet our criteria and where we feel our brands will translate well.

Does GameStop’s acquisition of Micromania concern you?

We’re very focused on our own strategy, we evaluate every market individually with specific criteria as to where we feel the growth opportunities are and where the best return on investment lies. I would say we’re very pleased with where we are today.

Are you looking to increase your UK store base any further?

Both store growth and e-commerce growth are very important for us in the UK. We recently completed an evaluation of our property portfolio with regards to GAME and Gamestation and we do see that there are opportunities to open more stores which include new locations for GAME and new locations for Gamestation where we have added almost 30 stores since acquisition.

A new and exciting development we have today announced in the UK is our relationship with Borders where we will have 33 new GAME concessions, with 20 open for Christmas.

Will GAME Group have enough hardware stock to satisfy demand this Christmas?

The information that we have so far looks like we’ll be in an improved supply position this year versus last year. We expect that there may be intermittent stock shortages at times, where we’ll run out of one format or another, but we’re working closely with our suppliers so we can best meet our customers’ needs this Christmas.

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