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I'm just curious how this will all play out over the next several years. My understanding is that GW has been having some 'less than optimal' periods of revenue recently (since say 2004 or so). Some of this is likely due to LoTR craze diminishing. Others say the prices of WH & 40K are too high.
Along comes a new expansion (Apocalypse) that encourages the build-up of very large armies, and yes I know we can achieve large forces by allying too, but don't be fooled, this is a sales & marketing pitch to get us to buy more of their products. To that end, GW is making available some very large Apocalypse sets for what currently appears to be more reasonable prices (we'll have to wait and see on the actual release day pricing), further encouraging us to pick up a Baneblade or a Armoured Company of 10 Leman Russes in a box, so I got to thinking...what will this achieve in the long run?
Economics says there will be a short-term run on the market (lots of people will buy massive amounts of models three to six months after the splash release), and then the market will be flooded with lower costed models (supply with little demand will drive the prices down), and cheaper models will be available via ebay and other online auctions sites or discount retailers. What will this mean to GW? Let's see...they get about 2 really good quarters of revenue, followed by a potential decline for a longer period of time (likely several years). I say potential because I don't yet see how the brain-trust at GW can turn this into sustainable buying pressure - ie. - continuing the flow of new models, codexes, etc. to keep they buying public excited. Yes new codexes will surely come out (okay, so we'll buy new books), but there will be a glut of models on the market, so we'll find cheaper deals else-where which will end up hurting GW in the long-run.
1) Scale back their retail locations to reduce operational expenses. Retail location are the most expensive to own / operate.
2) Compete with the online retailer discounts by offering a discount through their online stores...I think even a base 5% discount with FREE shipping and reasonable bits pricing would be a great start.
3) Institute a repetitive customer discount or earned credits program. Track their customers spending through a club-card number or customer number (online and in the retail stores), and give them a 1% discount or year-end store credit for every $100.00 (US) that they spend in a given year (to a maximum if 20% or 25% or something).
4) Turn product releases into repeatable and frequently timed events (this is actually getting better).
5) Institute a better 'listen to the fans / veterans' campaign. Show their customer base that they're listening to the feedback. Timely and regular updates to FAQs, and printed product schedule for the coming year and other communications could be the gist here.
6) Get the fans involved. Let some tournament winners participate in the design of a Special Character or new Unit for their winning army. (Say the top 2 or 3 winners from the tournament cycle? Now that is something to fight for!)
This isn't meant to inflame or irritate anyone, but this is intended to spark conversation on what you think the Apocalypse release will mean to GW and the hobby over time. What do you think this mean to you, your club and your local stores in the next 3 to 6 months, and then what will it mean to you in 2 years?
As much as we have tended to flame and hate GW for all their marketing ploys and highly-priced miniatures, it would be nothing short of tragic if GW's more recent financial problems were to send it into bankruptcy - hence ending Warhammer.
Personally, Apocalypse has gotten me quite excited but I can see how the mass miniature purchases could eventually end in GW's decline.
Your ideas are all solid. I really like the idea to 'design your own character', as its fun and good PR. GW needs more PR.
Hopefully Apocalypse will spell the beginning of a new era for GW rather than the end of it.
Only in Death does Duty end.TAU EMPIRE: 2000pts
WOOD ELVES: 1000pts (and growing)
If they were to discount their product further to customers who buy direct, I honestly believe this would be the last straw for many retails, and they would no longer carry their stuff.
The repeat customer incentive is available at MANY local hobby stores already. They track your purchases and give you a discount when you spend more and more money with them. Again, why can't GW go down this path. Most FLGS program is more rewarding sooner (5% off for purchases of $100 or more, 10% off for $250 or more, etc.). Just providing a mechanism for people who WANT to buy through GW stores (retail location or online) so MORE of their money goes directly to the company isn't a bad thing. And with better, cheaper or friendlier service available at the FLGS and other discount online retailers they still have other options.
I know not all of my ideas will work, or turn the direction of a large company, but I do believe that they have a good product, and there is good potential. I do question some of their management and marketing decisions, but I thought I'd at least share my viewspoint, thoughts, ideas and perspective.
Just bought a Defiler and a White Dwarf from a friend who works in an independent store which cost me less than 45 euro. The retailer can afford to sell to its staff at a 35% discount on GW stuff they stock so its not like GW are forcing them into a corner on prices. (other than to force them to overcharge a certain amount)
Not sure how much of a loss in profits there will be on the Apocalypse but i don't think it will be passed onto the retailers so GW must be taking a hell of a hit.
That said when you consider the size of these sets I also cannot see GW being in serious competition with the retailers to sell these sets (not directly at least). The retail space needed to sell these would be too much for most stores to get more than 1-2 boxes at any one time.
Last edited by wyrdone; August 31st, 2007 at 20:42. Reason: coherent sentences ftw
As I understand it, most of the apocalypse boxes will be direct-order only from the GW site.
So, it's own website will start to be a serious competitor to the online retailers out there that offer the same stuff as the GW site but with about 25% knocked off.
Most of the savings will match or be about 5-10% better than the online retail competition.
resale prices don't change much, since resellers were always getting a discount from trade accounts anyway, GW nets overall profit due to undercutting the online competition slightly.
They're not stupid when it comes to business.
Inquisitor_Eljer, i think you have posed some very valid and interesting questions/points. I am only 20 and thus not too knowledgeable about business matters but it seems to me that the new and 'wow' factor plays a big part in thier sales. They are playing to our most basic instincts - to buy/obtain new and exciting things.
In the question of discounts, my local and only store gives us a 10% discount if we spend over $200, and 5% under $200. This is only if we are members of the local club. I think this is just to encourage us to come back, as their are other stores that stock GW product around my city.
I think your point of them listening to fans/vets is one of the most important, we are after all their customers. I have read many posts about people who have bad encounters with gw staff not listening to them and just trying to sell them the sparklyest new box set. It has even happened to me a few times.
Personally, i wont be buying to much that comes out with Apocalypse as i have plenty already, but in the long run would love to buy bigger sets as a way of starting a new army. Most people are going to try to find the cheapest way of getting things like ebay etc though.
I just hope that it doesnt spell the end for GW or they start raising prices as its a great hobby.
From what I've seen, GW has a "We're the only company that can sell our products online" standpoint. Though, in many cases they may be slow to enforce it, eventually, they start cracking down on the successful ones (BWBits comes to mind). This wouldn't necessarily bother me, however, but those other sites are offering significant discounts. AND, I think the point that bothers me the most is that their website is straight out of the late 90's/early 2000's. Seriously, I haven't seen a store/shopping cart be so dated in quite a long time. They've made a little progress, but come on. Get some flash, get some AJAX, get some technology that isn't ASP. As a web developer, it pains me to want to buy things from a webstore that looks (and feels) like it hasn't changed since 2002. I want to buy from them (to support them) but it's very difficult.
You want to keep me buying from you (esp online), update your f***ing website. Make me feel like your site is top-notch. Add features, like frequent customer discounts, discounts for members, fire sales, etc. Don't make me look at your site exclusively for the advance orders... I should go there for everything that I can't get at a store (even things I can) and more.
I know this is a lot to ask... but, come on. The web has been around for a long time. So has web retail. GW is a company that could make a killing if only they'd get with the rest of the business and maybe even accept the web as one of their primary revenue engines...
Just my 2 cents.
The people running GW right now have the retail sense of a banana. GW used to be a mean marketing machine, way back in the 80s and 90s, and that was why it was successful. The problem is that it's kept that mindset up into the 00s and people are just going "yeah. sure. whatever."
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Come, sons of LO! Kneel before Poodle!
Mr_Wayne: "Some people believe that the World Eaters do not field any ranged weaponry. Those people often die at a distance."
Hey, does anyone remember the 'Skullz' sticker thing?
I would love to that make a comeback or some sorta loyalty card thing set up.
And so the Ultramarines Tyrannic War Veteran says to his friend "Lictor? I hardly knew her"Originally Posted by Karmoon