EA boss John Riccitiello has singled out the UK High Street for its exceptionally aggressive pricing strategies as retailers looks to use video games as a tool to expand their market share.
The UK is the place where retailers freelance and do their own things – particularly those that are new to our sector because they are trying to drive traffic into the store,” he stated at the UBS Media conference.
The UK retail channel at times runs on their own a little more aggressive than usual. What I’m seeing right now is a market share war going on at retail.”
EA’s FIFA 10 sparked arguably the most ferocious price war in the UK this year, with supermarket Tesco slashing over 50 per cent from the game’s RRP. The move pleased consumers but left most specialist games retailers unable to compete, with sales lost as a result.
What I’ve been witnessing at retailing the last couple of years is an unfair fight,” the exec continued. One retailer that has got a lot of staff on the floor was pursuing an effective share model to take share from competitors that are less able to execute that model.
And those guys were taking pretty high margins on their videogames and now they have decided to get aggressive on price which is where they’re strong.”