Though GAME’s recent financial results were in line with expectations and far ahead of the global declines seen in the video games market, the retailer has pointed to the heavily decreased performance of Wii on the High Street as one of the key reasons behind its struggles in 2009.
In addition, it has highlighted that it retains a market-leading position of a number of the sector’s key products.
The market responded well to the release of new hardware technology, the Nintendo DSi, and innovative sequels to established franchises such as Call of Duty: Modern Warfare 2, FIFA 10, and Wii Sports Resort,” chairman Peter Lewis stated.
GAME took the leading market share in sales of these products.”
It was the strong performance of these products that successfully offset declines elsewhere.
We saw a decrease in the demand for consoles through the year,” Lewis added. This was largely attributable to the Nintendo Wii which performed exceptionally well in the previous year. In the UK, hardware sales declined by over 26 per cent. Though still the best selling format, Nintendo Wii revenues were down by over 49 per cent compared to exceptional sales in 2008.
Following price cuts, sales of PS3 and Xbox 360 hardware were down by only 6 per cent and 19 per cent respectively. Sales of higher margin software were down by 17 per cent. This was again led by Nintendo formats, with software revenues for Sony PS3 and Xbox 360 formats showing an increase on those achieved in 2008.”
GAME also took the chance to stick up for the much maligned second hand market – a sector that it firmly believes is vital to the wider health of the sector.
We outperformed the market and our performance can be attributed to our position as the market leading specialist, our strength in pre-owned, our multi-channel customer offer and disciplined operational management,” Lewis outlined.
These include a market leading pre-owned model which enables us to compete directly in a market where some competitors are using loss leading tactics. This, supported by the widest range of products, market leading promotions and offers, over 14m Reward Card holders and a strong online proposition, enabled us to deliver recognisable value for money.
We continue to believe that this is the right offering in a market where we will see continued technological advance and broadening customer appeal.”