Founded in the Netherlands in 2016, Startselect has grown rapidly over the last five years to become “Europe’s largest reseller of mobile and game credit, gift cards, subscriptions and digital games”. Having fostered partnerships with digital platform holders and publishers, the company prides itself on its legitimacy, as well as customer trust and security, which has allowed it to expand into Australia – and soon, beyond.
Planning Startselect’s rise to digital retail domination is its founder and CEO, Max Gudden, who as a young man was frustrated at not being able to buy an Xbox Live membership without either having to leave the house, wait for it to arrive in the mail, or convince his parents to use their credit card. As a result he brought up as many Xbox Live scratchcards as he could afford and started selling the codes online. That was in 2009. The rest, as they say, is history.
Can you give an introduction as to how Startselect got started?
Startselect launched in the Netherlands with a very broad (we had more titles than Amazon) PC catalog and Nintendo eShop Gift Cards, which allowed us to get traction and show to other partners that digital was the future and that Startselect is the right partner to shift the market from physical to digital. With the launch of the iTunes Gift Cards from Apple we also serviced mobile gamers and in mid-2018 we expanded our console portfolio with the launch of Sony’s ESD program, that gave gamers access to games and DLC to purchase via digital codes. Startselect kept expanding into more countries (all of Europe) until the end of 2019 when we prepared for the first country outside of Europe: Australia, as well as launching the Startselect App and offering Direct Redemption: an easier way to purchase. Today, Startselect is the platform for consumers that want easy and instant access to entertainment.
How has the market for prepaid cards and digital game codes changed since Startselect became established?
The Startselect success story generated a snowball effect across mobile, console and PC gaming brands that (together with us) started the digitalization of their prepaid gift card products. Over time we managed to show our partners the benefits and the consumer demand for these digital gift cards, and together we launched digital products in many countries around the world. What started with fixed values is now being upgraded to variable value gift cards for consumers, so that they can purchase or gift the exact amount they want. Nowadays our partners recognise that digital gift cards are crucial to reaching all consumer segments out there, and – in contrast to the early days of digitalisation – they now knock on our door to work together on bringing the best consumer experience to the markets we operate in.
What about since the onset of Covid: Have gamers become more open to buying digital games from third-party retailers such as yourselves?
We have indeed seen a shift from physical to digital during Covid where consumers weren’t able to purchase physical products due to restrictions and found out about Startselect. From what I’ve read from feedback, consumers seem happy to find out about the digital alternative and don’t seem to want to switch back to buying physical. As a pure player in the home entertainment space with virtually unlimited stock, Startselect was one of the go-to places during lockdowns. It was truly rewarding to hear and read customer stories where Startselect was the solution to their problem during one of the most difficult times in their lives.
By what metric is Startselect Europe’s largest provider of game credits, gift cards and digital games?
We are the largest by the number of products that we offer (as an official reseller)
How has Startselect become so successful without courting the controversy that has dogged other key retailers over the years?
By the choices that we made when we started out. Startselect is not a marketplace where consumers can sell to other consumers (which attracts shady actors), so by choosing to work only with the right distribution contracts from our partners instead of sourcing through traders/middle-men that turn physical products into digital products (grey market). With the support from our partners (for example, being featured on their websites and in communication) we can show everyone that everything is legit. We strongly believe it is our responsibility to reach all consumer segments with our proposition to provide the best customer experience, and officially sourced product codes are essential to that.
What should organisations be mindful of when considering a partnership with a “grey market” site?
I’m glad to see that there’s a quality shift going on in the industry, as not all sales are equal. Instead of just looking at the total volume passing through, I’m glad that organisations are tracking more metrics to see in which country keys get activated so that they can calculate how much margin is missed out on if the keys were sold locally. Whether other organisations consider a partnership with a “grey market” site is up to them, but they should consider any possible reputation damage that comes along with it as well.
How are you able to remain competitive with other key-selling sites, when many of them can often beat you on price?
There is more to it than just competing on price. We focus on convenience and trust, and giving consumers a safe place to purchase from.
How important is it for Startselect to establish and retain partnerships with game publishers and distributors?
It’s super important. It’s the only way to win in the long term, for both the partners as well as ourselves.
What can you offer a potential partner that your competitors cannot?
A potential partner finds in Startselect a trustworthy companion with instant access to more than 20 markets in Europe (and beyond). What makes Startselect stand out from the crowd is our niche-focus on this product category – game credits, gift cards and digital games are our bread and butter – in combination with our transparent and sincere way of doing business. Being a frontrunner in this space, Startselect has valuable customer and market insights that we gladly share with partners for the purpose of improving our proposition, to better serve our customers. Our continuous drive to become best in class when it comes to anti-fraud control, (brand) compliance and local regulations, has convinced multiple global brands that we are the go-to retail partner for product innovation, market expansion and marketing campaigns. And of course we are fun to work with (although we do have that typical Dutch directness…)
Startselect recently expanded into Australia. What was the appeal of Australia above, say, North America?
We scored all countries around the world based on their market potential (e.g. an appetite for digital entertainment) and market entry feasibility. Ultimately, we want to bring our proposition to each country in the world but we started with Australia because its market potential score in combination with the expected efforts to enter that market, provided the most promising business case. However, our internationalisation journey is far from over, we are just getting started!
Has the expansion been a success? How so?
We look back on a successful launch as it went better than our forecasts. We managed to service more people than we hoped for. A big success factor has been the support that we got from our partners (in Europe) that helped us launch in Australia.
Where might you set your sights next?
Spoiler: The next country that we will launch is on the other side of the world, Canada. And simultaneously we are on the verge of launching our shops in Saudi Arabia and the United Arab Emirates. The first product listings are already live, but some take more time due to the lengthy procedure that applies, since we are doing this the official way, obviously. Our roadmap for 2022 is already finalized and our teams are working to establish more exciting market entries around the globe. Put us on your watchlist and keep an eye on our progress!