GameStop Ups The Ante On The In-Store Experience
The video game retailer is using beacons, social, and value propositions to create hubs of expertise and interactivity.
The problem of “showrooming” exists for numerous offline retail categories. Consumers figure out what they want in-store, and then hop online to find the same product for less. In such a scenario, the retail location is a mere stepping-stone in the path to purchase, which ultimately, ends in an e-commerce transaction on Amazon or eBay, or another mega site touting discounts and other incentives.
Video game retailers are hardly spared from the epidemic. To an extent, they have it even worse than many other businesses because video games are often hotly hyped months before they’re released, in which case their manufacturers offer consumers the option to pre-order so that the product is shipped over and in their hands the day of its release.
GameStop, a video game and electronics retailer with thousands of locations in the US, as well as posts in Canada, Europe, Australia, and New Zealand, isn’t threatened by showrooming or e-commerce, says Charles Larkin, GameStop’s senior director, Technology Innovation. The retail chain has built such an army of in-store tech and human touchpoints that it has, in a sense, reversed the showrooming equation.
As evidence of its victory against showrooming, about 80 percent of surveyed GameStop customers say they plan on visiting a store to purchase a product they saw online with GameStop, Larkin says. Helping create these in-store victories is a combination of factors including various value propositions, an expert, social-media savvy staff, and digital technology beacons, which Larkin suggests, is just the beginning.
GeoMarketing: Can you walk us through some of the key reasons that GameStop shoppers would feel a need to go in-store, rather than just order a game online?
Charles Larkin: First, we have unique currencies and value propositions at GameStop that you just don’t get elsewhere. [We offer consumers] the ability to trade-in their old games or their old electronics and then use that to either fully subsidize or pay down the cost of a new purchase. Getting a new game is a really compelling value proposition for gamers because they basically can play more games in a month or a year than they would if they were having to pay the full price up front for every single title.
Secondly, if [gamers] do a lot of research online, they can see a lot of great things but we have store associates [who are themselves] gamers. So, [a consumer] is going to get a more socially oriented opinion on the games when they come in store. They’ll watch a trailer that looks really good then go into the store and talk to somebody who is a really deep, knowledgeable person on that [and other] games. Their expertise is awesome and they’re really excited about it. Consumers are going to get that expert opinion in a really quick, fun interaction.
Thirdly — and this one is it gets debated all the time, but we see it [happen] — instant gratification. You can order a game online and certainly you can get it overnighted or you can get it in two days or whatever your preferences are there, but in the moment when you’re excited about a game, if you can go to the store and validate your research with somebody whose really going to help you understand that title, and then pick it up right then and there with that value proposition; that’s a good experience.
Does GameStop extend its “in-store social,” so to speak, to online social?
From a social perspective, we’re working on building up an employee-advocacy program through a company called Dynamic Signal and a product called Voice Storm.
Our store associates in our test market are creating social connections directly with customers. When there are products that these associates are excited about, they’re able to post trailers or event information online. They’re able to talk about it in their authentic voice.
It’s not a Facebook ad coming from GameStop proper; it’s somebody that gamers decided that they trust or respect enough to follow on Twitter or connect with on Facebook and they’re giving their unfiltered opinion on a game or they’re telling them about a cool midnight event. They’re really just talking to them with a direct connection through social networks. We think that’s a really great way to take that kind of knowledge and expertise and that passion that those associates have and bring that to the customers through digital channels and through social.
We only have beacons in our test markets in Austin and surrounding areas in Texas. We’re testing all sorts of different experiences right now. I would say the thing that got us really interested was the ability to actually create a mobile user experience around beacons. We wanted the beacons to unlock content and exploration of the store.
What’s the nature of the experience between the consumer and the beacon?
We’ve got an app on the app store and when [consumers] open up that app they can use it to browse the deals on the shelves via the beacons. They can watch trailers, look at [game] ratings and reviews while they’re in store. We’re going to augment their ability to research in the store and do that in ways that we as a company don’t offer anywhere but in that store right now. We want to reinforce those same reasons they came into the store once they’re in the store.
What got us connected with Shelfbucks was this idea of using the beacon [in a different way]. We didn’t look at beacons as this thing that was hidden in your store somewhere or as something that would close the loop on whether or not you visited the store and then be able to send you messages; instead, we looked at beacons as something that we could put on the shelf and wrap marketing material around. We said to our customers, “Hey, come and engage with this beacon” and “We’re going to offer you more ways to save while shopping at GameStop and while looking for games that you like.”
When you think about the beacon experience at GameStop, and if you were to visit one of our stores in a test area, when you walk into the stores the beacon it’s mounted over the shelf with branding over it. It’s got a two-foot sign next to it that describes how it basically downloads an app, and how to hold your phone up to it and save money. It knows what you’re shopping for and it can then show you on the screen a list of those relevant offers that pertain to the approximate section of the store that you’re shopping and then offer you the ability to research the products within those promotions.
It let’s you interact with the shelf in a way that helps you guide your shopping experience. It’s not about just getting a message, it’s about basically using your phone to drive the shopping experience in the store and actually get mobile, interactive experiences as you do that.
What’s the future of beacon and other digital technology looking for GameStop?
While I do believe that we will experiment with using beacons to deliver push notifications over time, we think that that’s something that you have to be amazingly good at — one-to-one customization of messaging and personalization of offers. That’s just not something that’s really prevalent in the industry right now, especially when you talk about gamers who have really high expectations around that.
It’s not good enough to know that you like a certain brand of apparel or you shop a lot for a specific type of apparel whether it’s jeans or purses, etc. You really have to know somebody [in gaming] deeply to know that they like first-person shooters, and in the first-person shooter round they really prefer these types of first-person shooters from this developer or this publisher. Gamers are tech savvy, and while we have great opportunity to experiment with mobile experiences, we also have to respect the level of expectation [they set].
We’re going to augment [consumers’] ability to research in the store and do that in ways that we as a company don’t offer anywhere but in that store right now. Once people are in the store we want to make those reasons we discussed that drove them there even better. Let’s make it better to explore value. Let’s make it more exciting to engage with products.
Besides beacons, what other technology is GameStop considering in terms of deepening that connection with digital consumers?
We’re working on launching augmented reality experiences where you’ll be able to hold your phone up over a poster or product and get ratings and reviews and [Entertainment Software Rating Board] descriptions. You’ll get to see really cool high fidelity trailers or 3D models on the screen talking to you about the game. We really focus on the product knowledge and depth of research there.
We [look to provide] exciting ways to explore products in the store in the world of gaming but at the same time teach about the product. So for us beacons are a trigger to start looking at different ways that we can give awesome gaming experiences in our stores. That’s flat out what we want to do.