Stuff in the Store

Stuff happening in the store:

• Open New Years Day. We'll be open regular hours, 10am-10pm. The same goes for New Year's Eve (today). New Years Day is traditionally a decent sales day. This leaves only a few days we're off during the year: Easter Sunday, 4th of July, Thanksgiving and Christmas. I would be willing to be open the 4th of July if someone would work it. I've tried Easter Sunday a couple of times with no luck. It's a great time to do paperwork.
  
• Stuff on Sale. Flames of War is the big post-Christmas sales item, with about a quarter of the inventory at 40% off. My philosophy on sales is to do them infrequently and do them deeply. Dump stuff fast. Other stuff on sale includes a remaining basket of Reaper miniatures, AT-43 and a dwindling basket of unloved colors (Vallejo).
  
• What's with Flames of War? We had a thread going on Facebook, but it comes down to this: Sales are sliding and have been for a couple years. They're down 20% from a year ago, and from the inventory it's clear that the game isn't attracting new players. "Bread and Butter" items needed to start armies aren't selling, which says that unless we can get some organized play or demos of this game in store, it's eventually doomed by attrition. Why don't we do it in house? It's a big game world out there; if a game can't generate enough interest for two guys to regualrly push it around on a fancy table once a week, what good is it?
  
• Alkemy Expansion. Some folks have taken a chance on Alkemy starter sets, so I'm expanding the selection further with 3 man unit boxes and hero boxes for the three factions that have been purchased. That's everything available right now. There is no love for the Aurlok nation, but if this game gets going, I'll personally play it. I find it the most appealing. Yes, I know, I should lead by example and buy the box and start it myself....
  
• Back for Convention Season. We took 2008 off for most conventions, but this year we're all in. We're confirmed for Dundracon (2/13-16), Conquest Sacramento (3/20-22) and Conquest San Francisco (9/4-6). We'll likely have some sort of event or sales weekend during that other con in May. I'll also be at the GAMA trade show in April. I'm tempted to do Gencon as well, but can't swing the expense right now. I'm half convinced that Gencon is a better trade show than GTS. Maybe if I'm fully convinced I'll do Gencon instead in 2010.

Aurlok Nation Starter Box

The Lost Week

This week is unusual for us. Part of it has to do with the calendar, another part with the game industry, and the final part with the poor economy. This week is slow, much slower than in past years. The placement of the two major holidays so close to the weekends has it made an ideal vacation time. A lot of of the post-Christmas sales have been diverted to next week, or so the theory goes. It has given the perception that the post holiday season is soft, which if I consult the media, is true for everyone else, so why not us? It has re-injected more caution into my 2009 plans. I don't think I'll be entirely comfortable until February.

This week is also strange because of the usual game industry hiatus. Major companies take week long holidays from around Christmas until January. This is the same counter-intuitive argument I've ranted about for years, leaving your post while the enemy is invading, or some other metaphor that says this is the busiest time of the season, where are you? There has been a scramble for Magic cards, for example, with a backlog of distributor orders because Wizards of the Coast is closed. This issue goes to the heart of my problems with the game trade, the perception that it's not serious, that it's a lifestyle job. It's enough to make anyone trying to make a living at this go a little mad each year. Reinforcing the "getting the product to market" problem are the shippers.

UPS and Fedex are making things up as they go along. Retail holiday sales blew chunks this season, despite our success, so the shippers are getting lower levels of business than they would like. They've decided to take days off, or modify their schedule. UPS won't be picking up on Thursday, for example, while my Fedex driver tells me they're having a meeting today to decide. What does this mean to me? Just-in-Time is thrown out the window and I'm forced to stock up on projected sales items during a rather odd period. I'm not just spoiled with JIT, it's my business model.

Anyway, for those of us working very hard during this final week of the year, it's difficult not to think our partners are resting on their laurels.

Half a Squad Short... (40K)

It's these kinds of realizations that keep me in business. I thought I was done with my 3,000 points of Imperial Guard, but I've got 5 more guys to paint, including the standard bearer (how could I forget him?). At this point I could easily tweak the list to not include them, but I've come so far, I can't wimp out now.

Baneblade VI

This is definitely one of those models where you have to draw the line and decide you're done painting. It has been two months since I began the project and the model was gathering dust while I was slowly painting it - definitely not good. I went with a minimalist approach, after looking at various Baneblade paint schemes from an old White Dwarf. There is no number or designation for the vehicle. It's just too big, too singular a vehicle, too freaking central to the entire army for someone to wonder which baneblade. It's The baneblade!

Brushes

One of the most important tools of minaiture painting is the paitn brush, yet we don't know a lot about them. I've just gone through the most intensive painting period in my life, having just completed two Warhammer armies in the last year: 3,000 points of 40K Imperial Guard and 1,200 points of Fantasy Ogre Kingdoms. The one thing I've learned is that you can't beat a high quality sable brush.

I've gone through a LOT of brushes over the years, and sable brushes are the ones that stand out for both quality and durability. I'll periodically go through my brushes and mercilessly snap any that are no longer performing. After the last round of brush snapping, I was left with a handful of sable brushes and one synthetic. The sable brushes were from a variety of manufacturers: Vallejo, Privateer Press P3, and Reaper. It really didn't matter the brand, as long as it was sable. These are the brushes that last the longest and maintain their shape. Games Workshop claims that their brushes are sable, but I think they're mistaken. If so, they're the worst sable brushes I've experienced, and at sable brush prices.

A good sable brush will cost about $10-12. I've never used the Windsor-Newton brushes that go for $20 each; I just can't imagine that they're that much better than a quality sable hobby brush. I suppose some people feel that way about sable compared to synthetic. Anyway, the key to making these brushes last comes down to cleaning. First, avoid getting paint on the metal ferrule, as the bristles splay and the brush becomes more difficult to clean. Second, I tend to "twirl" the brush against the side of a clean bowl of water, as opposed to pounding the "toe" into the bottom. That's just common sense. Finally, I'll periodically take a clean brush that's starting to look a little ragged and I'll dip it in acrylic paint thinner. I use a bottle of Tamiya thinner for this purpose. It's not rocket science, but just a little extra care and my sable brushes have lasted many months of intensive use. Meanwhile, the synthetics seem immune to any rejuvenation, and end up with the snap treatment.

I'm no expert. If you've got a better way (or another way), let us hear it.

JIT

Our holiday sales period continues into January, as regular customers return to the store to redeem gift certificates and spend "grandma money." Regardless of how that turns out, I think we can safely call the season a wild success. Our sales were up nearly 20%, and we did it without a lot of the holiday risks associated with uncertain times.

Just in time inventory was key for us. The moment the store closed on Sunday the 14th, I was logged in from home putting an order together. This was to beat the inevitable Monday morning rush from other game stores, and thankfully I've got a sales rep at my primary distributor who thinks like me. While I logged in to my POS from home, he logged in to his ordering system from his house in Wisconsin. Together we hammered out an order, sucking out product from various warehouses. For the most part, our JIT inventory arrives the next day, as three of my major US distributors have warehouses in the Central Valley or closer. This late night login was repeated nearly every night until Christmas Eve.

As the season intensified beyond all previous measure, JIT became even more timely. One of the smaller, virtually unknown distributors is located a mere ten minutes from the store. We don't use them very often because timing is usually not that important. Last week we made several visits for items that we needed immediately. Next day delivery became same day delivery, something we'll take advantage of more often in the future. It also helped us locate stock that was out at all the major distributors, such as the last copies of Qwirkle. We'll be buying there regularly from now on.

Just in time is not suited well for the holidays, as it means spending a couple of hours each day receiving all this merchandise, rather than stocking up in advance. A stocked up store is serene during the holidays, while just in time can be a nightmare, especially Christmas Eve when ten boxes arrived, the label printer broke, the phone was ringing, and customers were lined up at the register. We handled it in stride, but it had the making of a nightmare scenario. JIT means staff is doing operations instead of sales, which is bad when it's busy.

On the positive side, we're sitting on a surplus of inventory dollars, rather than the usual surplus of inventory. I tended to order a day or maybe two in advance, which means even our current overstock consists of maybe half a dozen evergreen copies of a game. JIT also worked extremely well this season because of the lack of local competitors. For the first time, customers were willing to wait. They could take their chances and we would hold something for them, but just as often they would pay with credit card for a future copy of a game, usually planned for arrival the next day. Muggles tend to be the most mercenary of customers, and for the first time, they agreed to be patient. The alternative was a drive through the tunnel of hell to an Oakland/Berkeley store. We're thankful they waited. The JIT Wikipedia article rightly points out:

...since stock levels are determined by historical demand, any sudden demand rises above the historical average demand, the firm will deplete inventory faster than usual and cause customer service issues.

We didn't take advantage of lack of local competitors, but we certainly benefited from it. It also allowed us to be a bit mercenary right back at 'em. Secure it with a credit card or you could lose out. Pick up an unsecured item by 5pm, or it goes out on the floor. It also stretched our processes to the limit as we literally ran out of space to hold things. A crisis is when you learn if your procedures are worth anything, and although ours frayed at the edges, they rode out the storm.

So, How's It Going?

I'm a big fan of bullet points when I'm only partially coherent from exhaustion. Some observations from the holiday retail trenches.

• How bad are sales? Despite endless reports of how people are giving belly button lint for the holidays, our sales are up. They're up about 15%, which includes our best sales day ever (yesterday), our second best day (the day before) and our fourth best day (Saturday).
• Yeah, but you're uniquely positioned. I'm hearing through the grapevine that other Bay Area game stores are seeing similarly good results with record sales. Last Saturday was the best sales day ever for at least three of us.
  
• People are using a lot of cash. I wish! Credit cards are being used in the usual depressing ratio, and in the same proportions. For a while I thought Amex and Discover were being used more, but it's proportionally the same.
• Layaway sales are the new trend. We had one person talk about this, and we learned how to do it with the POS system, but it hasn't happened yet. The whole concept is alien to me. Buy a piggy bank (we sell those too).
  
• The percentage of credit card declines are way up. Nope. While I've been at the register this month, I've had it happen once.
• Parents are cutting back on toys. This is true for us. Despite a perpetual sale on toys, people are not buying them. They're instead buying more educational items like puzzles and learning tools. Puzzle sales are double last years; toys are half.
• People play more family games during a recession. The clear, undisputed heavyweight champ of the holiday season is board games. The Chronicle article certainly helped a lot with this. Our board game sales are twice what they were last year. There are some irreversibly bad economic changes that have occurred this year, but wouldn't it be great if hobby games came out as a long term winner? My sincere hope is that the hundreds of board games we sold this season connect with those who receive them.
  

What's New with the New New

Just a quick note to say the Alkemy game starter sets sold out. We'll be getting more of them. The key now is to see it in play, get some impressions, and find out what needs to be brought in next beyond starters. The other skirmish game we tried, Infinity, never caught on (we still stock the starters).

Hitting the Highs

Yesterday was our best normal sales day ever, missing our best sales day by about $20. I was reading a New York Times article entitled The Scramble for Downtown Dollars, and I had to smile, as the article talked about how in tough times some stores have had to get clever, promoting themselves with events! It made me realize that game stores may be well positioned to ride out a downturn.

The event model has been an evolving survival mechanism for game stores for years. Describing this as a survival mechanism might seem cynical, but few game store owners would provide such space if it wasn't economically essential. Yesterday's sales were beat out by our October Ding & Dent auction day. I can find similarly high sales days related to Magic pre-release events, convention sales days, and our anniversary parties. We need these gimmicks and tricks for survival in good times. Relying on them in bad times is natural. The game stores that can't promote themselves beyond the counter are the ones most likely to fail.

Here's an updated board game list. You can begin to see that the Chronicle games (in blue) are playing an increasingly important role in our holiday sales:

1. Wasabi!
2. Dominion
3. Settlers of Catan Rev.
4. Qwirkle
5. Battlestar Galactica Boardgame
6. Monty Python Fluxx
7. Witch's Brew
8. Carcassonne
9. Ticket to Ride
10. Ticket to Ride Europe
11. Wits & Wagers
12. Blokus
13. Fluxx
    
14. Killer Bunnies Blue SD
15. Munchkin
16. Five Crowns
17. Munchkin Quest Boardgame
18. Power Grid
19. Quiddler
20. Settlers of Catan 5-6 Player

Store Genesis

I live in Richmond. Despite the perception of many friends from the store, I've never been shot or shot at, had my home burglarized, my car stolen or have had problems with gangs. Like other urban areas, there are good parts and bad parts. However, when I drove across the country touring game stores before I opened Black Diamond Games, it was clear Richmond didn't have the proper demographics. In other words, not enough core customers: geeky white guys (and now Asian guys). I knew I wanted a store, but where?

The most obvious places were Berkeley and Oakland. These are densely populated urban areas with highly educated people with moderate incomes. This wasn't just obvious to me, as there were and still are, half a dozen strong game stores in that area. Whenever a new one pops up, I have to carefully ask the owner if his head was screwed on straight. Surely there are areas that are under-served.* I started driving around and plotting out Bay Area game stores on a map. It was so dynamic, that some were failing before the ink was dry on my map print out. Four years ago there were many stores, and they came and went with increasing frequency. The Bay Area was looking too crowded with stores, so I started looking outside the Bay Area too, even considering Wisconsin, which my wife shot down pretty quickly. I visited stores in Sacramento and Davis, but these offered too little reward for requiring a relocation. After all the research, the obvious choice was Pleasanton, and I started scouting out available properties there.

Pleasanton is a strange town. It's got a high income level and plenty of geeky white guys (and Asians), but the place is spread out along the 580 very thinly. It does poorly on the magic formula of retail customer predictions, the ten minute drive time. Within ten minutes of anywhere in Pleasanton is a much smaller community than what you see on paper. It just didn't compute. Nevertheless, it seemed like the most under served location, plus it's a major commuter corridor, so I went ahead with my plans. I had an industry expert perform a feasibility study. This is where I give him a big check along with a bunch of raw data on the locations, including photos and lease rates, and he writes me up a report saying which is best or if it's even worth opening a store in that area.

I was working as a network architect at Kaiser in Walnut Creek at the time and there was this open location right off the freeway. I had to sit at the endless light at the Treat exit off 680 North every day, and this little spot kept staring me in the face. I threw the address into the feasibility study, even though it was nothing like the Pleasanton locations. When the feasibility study came back, sure enough, the Pleasanton locations were awful. There just wasn't enough critical mass of customers anywhere in the area to justify a store, and four years later, there haven't been any new stores to pop up in that area. The Walnut Creek location blew the doors off Pleasanton, and the much shorter commute time sold me. Walnut Creek was it. Plus I could manage the build out during my lunch hour.

Negotiating that first lease would have been impossible for me today. An inexperienced business owner with limited funding and resources is often at the mercy of whoever will take them. Back then, however, I was flush with cash from my home equity and help from an excellent business partner who understood numbers and finance. I had an excellent business plan that tended to impress people, mostly because I could write well and my partner made me rework the numbers until they made sense. Business plans are essential, by the way, although like a military plan, they rarely survive contact with the enemy. Mine was no exception, although it was key in my first year survival.

We moved three years later, true, but the Walnut Creek store wasn't necessarily a bad location. It was centrally located, with small enough expenses to avoid a lot of risk, and although we didn't have enough game space, that limitation forced me to learn about games that other single owner stores with plenty of space would have ignored. All games sold equally well, requiring equal effort on my part, which is unheard of in a modern store with play space. The Walnut Creek store had it's limitations, like bad parking and increasingly cramped space, but it was a starter store that allowed me to make mistakes, and I made many.

The Concord location was born from the fact that the Walnut Creek store was too small to support me adequately. I wasn't making enough money, long term, so the solution seemed to be a much larger store. This has since turned out not to be the case, as the risk has gone up without a corresponding reward, but it's still early in the new stores progress (plus we've been in recession that whole time). The Concord location was determined with customer data. Paladin club members give us their address so we can send out mailings. This information was plotted out on Microsoft MapPoint, which created a pretty map showing the location of our customers. Many were from Walnut Creek, which was normal, but there was an obvious concentration to the north, in Concord, Pleasant Hill and Martinez. I found it strange, but to the South there were very few customers. I learned there is a kind of demographic income height at which you lose customers. Those making a six figure salary tend not to be gamers. Perhaps they're too busy working all the time to play games.

The Concord store was build based on the data from the Walnut Creek store. One thing that I'll mention is that I now think the idea of a suburban game store is a bad one. Looking around at other stores, I think the best idea for a game store is to place it in the highest concentration of people you can find. Suburbs have a population density that I think is too low. On top of that, suburban folk are much more isolated from sub-cultures like gaming, and much more in tune with popular culture and consumerism. They certainly buy things, but it won't be some strange game. I base this theory on the limited success we've had being the only game store in the region. Compare the data of our store to the half dozen in Oakland and Berkeley and you'll likely scratch your head. There should be more stores out here, but there just aren't enough customers to make it work.

That said, our holiday sales are up 10% so far in December. I know some of that is because many competitors have closed. Some if it is the San Francisco Chronicle article about board games that mentioned us. Some of it is also being open a year, since last year we were open only a couple months before the holidays hit. I'm curious how things would look without the recession. Hopefully I'll find out next year.

You can read about how we selected the store name here.

* Areas that I would consider placing a game store: Pinole, Alameda, perhaps a mall store in a major Bay Area indoor mall, if the price was right.

Customer location from May, 2007

Holiday Trends

• Go sets are up; backgammon is down.
• Farkle is way up; liar's dice is down.
• Board games are way up, collectible minis are way down.
• Toys and Puzzles are way up...

Facebook Ad Update

After half a million impressions , 169 clicks and zero in-store coupon redemptions, I suspended our Facebook ad account. It was beyond the free $100 credit and it seems not to be very effective on what I think is an extremely good offer.

The New New

I'm starting to feel a little pressure from the local gaming community to bring them something new. Gaming podcasts have replaced local competitors in providing new gaming information and play tests, with several of my alpha gamers wondering how the store goes about introducing such new games. While the alpha gamers itch for something different, I'm stuck with that "flight to quality," in which my sales of fringe games dry up in favor of safer choices. Our Magic and D&D crowds have never been larger and the 40K group is growing. Alpha players want something new, but they might have difficulty finding anyone to play with.

The evolution towards what's new is organic and it's not entirely dependent on me. A Blood Bowl league developed in the store on its own. Other stores in the area have seen other inexpensive and quick skirmish games increase in popularity, such as Mordheim and a game called Alkemy. Alkemy is a fantasy skirmish game with beautiful models based on various real-world cultures. There are Egyptian, Native American (sorta), Chinese, and straight up medieval Europeans. I have the starter boxes on order so those interested can give it a spin. I'm really liking the unique sculpts.

Warhammer Fantasy has seen some renewed interest, so some new things are old things. I think 2009 will be the year we see Warhammer Fantasy take off at our store. It's not especially new and doesn't require a big investment from me, but it may be a solution to the desire for newness.
There seems to be renewed interest in historical miniatures, with various individual customers putting out their feelers in different directions. Unfortunately, I'm not seeing any critical mass towards one game and Flames of War, our current historical option, remains stagnant.

Notice that all this interest in something new is coming from the miniatures gaming crowd. The RPG crowd has gravitated strongly to D&D and the CCG crowd is mostly Magic and Yu-Gi-Oh, while the board game crowd is overwhelmed with new choices; probably too many. The miniatures crowds, however, seem to have a natural desire to mix it up on ocassion, something Games Workshop understands well, which is why they created their specialist games. They intend for their base to dabble in these games to refresh themselves before returning to the main games. This is something role-players do too, mostly taking a break from D&D, but there seems to be less acceptance of the concept and more gnashing of teeth when the "break game" ends.

Our crowd of anxious minis players is increasingly comprised of Warmachine players. Although that group continues to grow for us, there's a dissatisfaction or fatigue with the game that has driving players towards Warhammer Fantasy and other games. I'm hoping players in our Warmachine group can take a break with another game for a while, as opposed to seeing them slowly drift away down to nothing, like has happened at other local game stores. As a store owner, Warmachine and Hordes are problem games, as the skus (items) continue to arrive every couple of weeks, with no discontinuation of existing models. The warnings I received about 40K inventory creep are now more apt for Privateer Press.

Top Board Games

From the Ministry of Useless Information comes my list of our top selling board games for the season (last 30 days). I placed the Chronicle article games in blue, which shows they haven't had a huge influence on the list. Most sold modestly before the article came out, with Dominion being the only clear hit. The top two strategy games from the article are already gone but will arrive on Friday (Agricola and Stone Age).

1. Settlers of Catan
   
2. Battlestar Galactica Boardgame
3. Dominion
4. Wasabi! (reviewed in Chronicle poorly)
   
5. Monty Python Fluxx
6. Axis & Allies Anniversary Ed
7. Witch's Brew
8. Qwirkle
9. Ticket to Ride
10. Power Grid
11. Carcassonne
12. Munchkin
13. Blokus
14. Killer Bunnies Blue SD
15. Hey! That's My Fish!
16. Citadels
17. Ticket to Ride: The Dice Expansion
18. Fluxx - New Edition 3.1
19. Ticket to Ride Europe
20. Apples to Apples
21. GiftTrap
22. Ticket To Ride Card Game
23. Settlers of Catan 5-6 Player
24. Carcassonne: Cult, Siege, & Cr
25. Munchkin Quest Boardgame
26. Hey That's My Fish Deluxe
27. Ghost Stories
    
28. Cosmic Encounter
29. Wits & Wagers
30. Origin of Expressions

Games that should be up higher on the list:

Power Grid: It's been out of stock for a week now, but arrives on Friday. It's my favorite "advanced" holiday board game, meaning if you're an experienced board gamer, I think you should try it.
Agricola: It's been out of stock and has been sitting at the distributors warehouse since Monday. Z-Man has a Friday street date for the re-release (frustrating). It's the top game on the SF Chronicle strategy games list.
Stone Age: Also out of stock lately, with a small quantity arriving Friday. It's the number two strategy game on the Chronicle list.

Games that are now out of stock and will soon run out for the holidays:

Wasabi!: This is my new favorite starter game, despite personally not caring for it.
Witch's Brew: We've got a few coming on Friday, but they'll run out within a day.
Hey That's My Fish: Is out of print and our existing stock is all there is.
Fluxx: Is out of print as they prepare a version 4.
Qwirkle: Is in limited quantities at the distributors but we may make it.

Black Christmas

The store is doing very well. It was unclear whether holiday sales would even hit this year until last weekend. Traditionally, we have above average sales the first two weeks of December, followed by a steep ramp up until Christmas, followed by three weeks of regulars returning. What we saw over the weekend and what has continued into this week is a frenzy of activity, centered partially on the San Francisco Chronicle story on board games. It acted as a much needed advertisement of both our existence and of some good family board games.

What I've noticed about the article is that the tone and intent of the article has had a much greater role than in previous years. Yes, there were board games listed, but many customers came in with the message of the article in mind, that board games are an excellent value and fantastic way to spend time with the family. In other words, the article did the key sales job of selling the experience and not just the product, the sizzle rather than the steak.

It's true that some customers came in and just grabbed the listed game off the shelf, or moved on when we didn't have the exact game they wanted (the elusive Sorry Sliders), but far more than normal were willing to have a conversation with us, ask our opinions, and buy something off-list. That's the kind of interaction I enjoy with customers. In fact, it made me realize what annoyed me most about these kinds of articles; it's ego. It's that customers trust this guy who writes one board game article a year over my judgement, the guy who plays and sells them year round. Once I take a step back and drop the ego, I get out of the way of myself and have a much better customer experience.

SF Chronicle Board Game Article

Is here.

• We're listed first as a place to buy these games (alphabetical order).
  
• Customers waited in front of the store before we opened to buy these games.
• Sales were extremely strong with the games mentioned.
• Many are still in stock and the rest should be re-stocked by Tuesday afternoon.
• We really needed a boost like this to help this season.
  

Facebook Advertising

I've been wary of online advertising, mostly because I tend to ignore online ads. Facebook ads have been different for me, possibly because I've been addicted to the site for weeks now and I do seem to check out the ads. I've got a nurse scheduled to show up at my house on Wednesday to perform a physical for my new life insurance policy. I needed more insurance since having a child, and the Facebook game, Owned!, promised me a billion dollars for a quote. I've gotten auto insurance quotes for a leg up in Gangster Wars. In general, Facebook has enticed me to visit their advertisers when they've applied to me. I think part of this is that Facebook is a monumental time hole and running through an advertisers website is only marginally less entertaining than your average Facebook fare. With my personal marketing barriers knocked down, I decided to advertise my own business on Facebook after receiving a $100 advertising credit when I joined the Facebook Visa business network.

The most astonishing thing about Facebook advertising is the lack of any technical explanation. They practically give a marketing course in how to design a solid ad, and even then they micro-manage the ad with various edits after it has been submitted, but they don't really explain how their advertising works. For example, the bidding system is a mystery to me. On the first day my ad ran successfully when I left it ad the default amount of $.35 per click. However, after that first day, I went two days without a click. Over the next several days, I ramped up the per click bid to $.50, then $.75, $.85, $.95 and this morning to $1.05. Each increment resulted in higher ad hits, but nowhere can I find what this bidding process means. I'm assuming I'm bidding against other ads for placement within Facebook. I guess I'm supposed to just intuitively know this. Anyway, I feel a bit like a hospital patient with the little morphine button. You press it to increase your dosage, but at some unknown point it gives you the same dosage no matter how often you push it.

What struck me as interesting about the Facebook ad program was it's ability to target communities. It allowed me to pick cities, but apparently not regional networks like "East Bay." It also didn't allow me to select key words in user profiles to target, although Facebook claims to do that on the back end to increase ad relevancy. When I can better target the ad, such as the option to target everyone within ten miles who mentions the games we sell in their profiles, then sites like Facebook become the holy grail of advertising. I recently turned down boardgamegeek.com for advertising because their level of granularity couldn't drill down below state.

But does it work? I'm still fine tuning and although I've seen lots of clicks and have had an email from a customer regarding the ad, I don't believe we've had anyone redeem our Facebook coupon. It's for 40% off toys and puzzles, our Black Friday sale. On the other hand, I haven't spent a penny of my own money yet, just $30 of my $100 ad credit. Still, the daily feedback is so much more satisfying than throwing money at our cable TV and yellow pages ads and praying people see it. Best of all, I see this as an introduction to online advertising. If this turns out to be successful, I could imagine moving more of our very expensive and questionably effective traditional marketing budget towards the online sphere.

Trough of Disillusionment (iPhone)

The iPhone is probably in the Gartner phase of "inflated expectations," but I've got it in my personal "trough of disillusionment." The problem with the iPhone is that it's too much like a mobile computer: buggy software, a still too low battery life, and heavy handedness by Apple that exacerbates these problem.

For example, for many users like myself, the Safari web browser is more a novelty than a usable application. It crashes far too often to be useful and reliable. Apple's development agreement forbids anyone else from porting a web browser to the iPhone, which means we're stuck with Safari. This same developmental control has a negative effect on software applications, which can also be buggy, due, I think, to too little testing. I signed up for the LogMeIn beta test of the iPhone application, after complaining about a lack of software, but was turned down because Apple limited the Beta test to 100 users. 100 casual users is not a large enough group to adequately test software. Apples control of the application release process is a mystery, even to those who have submitted applications. Most don't know if their app has been approved until they see it in the online store.

Battery life is still a problem for me, with the iPhone hearkening back nearly a decade to my early cell phone days, when we had chargers everywhere and large collections of batteries. Unfortunately, the extra battery option isn't an option, with Apples closed architecture. They're simply not made to be replaced, and if you could, Apple would charge you $85 for another one. With constant problems with iTunes, I've resorted to a direct charge connection rather than fight the application. The concept of syncing data with a cable seems so primitive when so much information is coming over via wireless.

Overall, I think the iPhone is the most amazing electronic device I've ever owned. That said, it's of marginal use to those of us who shuttle from one computer to another. Those who are on the go or travel should find it an amazing tool. However, when my cell phone bill arrives, I'm often wondering how exactly it changed my life in the last 30 days.

Vacuum Update

Both are getting repaired; $35 each. Way cheap. I think an annual service is likely for us.

Obsession with Curves

December sales traditionally ramp up sharply in the third week of the month. I've been carefully watching for that curve, comparing year to year sales in hopes of seeing it. The pessimist in me thinks there may not be a curve this year, but so far sales are fairly normal, plus or minus five percent on a day-to-day basis. Retailers like myself need December cash for two important purposes. The first is to get into the black after a punishing fourth quarter. The second is to save up cash for the slow first quarter, usually the quietest time of the year. Many would have had a third objective of expansion with holiday cash, but those plans are on hold for most businesses now. Retailers who do really poorly and can't accomplish either objective may close their doors in January. Those who can achieve only one objective will find themselves in just as much pain as they're in now come March. My sales expectations for December are a normal low.

Normal low is what we got with the latest retail sales report. "Retail sales were flat" should have been the news from the latest sales reports, since after you adjust for gas, sales were down nationally a small .2%. A decline of point two percent is the monthly sales impact of a rain storm on a Saturday for us. No bid deal. Also, this data contradicts the big retail headline we saw with retailers having the worst monthly sales on record:

Retail chain-stores reported the weakest monthly sales on record, but the government data don't back that up. One difference: The government tries to adjust its figures for the timing of the Thanksgiving holiday, while the stores don't.

Another Year, Another Vacuum

Our third vacuum cleaner in four years died yesterday. I tossed the first one that broke, a horrible Eureka upright bagless model that rewarded you daily by making you clean out a small plastic canister of crud. That one was gladly tossed when it broke, but I've got the last two broken vacs sitting around for tight times like these. Rather than spend another $200 on a new one, I'll be getting one of them repaired; whichever is cheaper.

The first broken vac is a manly blue Royal model, built like an AK-47, with durable parts with loose tolerances, an extra long cord and a powerful engine. A man can hold his head up high while vacuuming with the Royal. The latest one, which died tonight, was a girly red Electrolux model, with a photo of a woman vacuuming in high heals on the owners manual. It's best feature was a quiet mode, for vacuuming while customers where in the store. It was bought in a hurry right before we opened the new store and I had doubts about her. Both lasted about a year, despite their high cost and good consumer product reviews. Who would have guessed that you should budget $20/month just for vacuum cleaner replacement?

Commercial use is pretty intensive. We've got a 3,300 square foot store and we vacuum every day. In theory we vacuum that whole space. That's twice as big as my house, which gets vacuumed once a week (I'm told). Doing the math, figure we use a vacuum cleaner about 14 times more intensely than the average household. So is there some magical, hotel quality, $1000 vacuum cleaner I can buy with a 5-year warranty? Perhaps, but most store owners tell me how they just accept going through these disposable items. I'm going to try cycling them through the local repair shop first.

Third Tier

Our customer loyalty software is back up again. The software developers identified it as a problem accessing the WMI service. That's the Vista Windows Management Instrumentation service, not to be confused with the Windows Module Installer, which is a completely different WMI service. The consultants were ready to re-install Windows, and I was too after spending several hours trying to fix the problem. The majority of my troubleshooting time was, get this, trying to rename a Windows folder. I ended up downloading a utility specifically designed to force the issue, and after that, I entered a half dozen command lines I cribbed from a Google search and WMI was restored. So I buy an expensive software package, hire someone to install it, call them when it breaks, and then fix it myself when they give up. It sucks being the guy paying the IT guys.

Just Showing Up

"Ninety percent of success is just showing up."

--Woody Allen

It may come as a suprise to some of our customers, but stores are in the business of selling stuff. Events and game space exist as a means to promote games and build community, which ultimately must lead to better sales. If you don't believe this, just look at stores that charge for their game space. They found this indirect sales model not to work in their area. So who is responsible for running these sales driving events?

In an ideal world, game store employees would do run all in-store events. A company like Games Workshop does a good job of this because their expenses are lower; they're the manufacturer, distributor and retailer of their product, so they have much higher margins than the average game stores. Game stores in the Midwest can also do this, as their overhead is a fraction of an urban game store. Having an extra staff member on hand is no big deal for them. However, for stores like ours with higher overhead, we rely on customer run events.

As urban store owners, we are at best event facilitators. The best event is supported by the manufacturer and run by a recognized volunteer. We have press-gangers for Warmachine, certified judges for Magic, and approved Dungeon Masters for D&D. These people are like independent contractors with an external system in place that gives some form of compensation not involving us. Some companies also offer prize support, such as free product (Games Workshop) or promo cards or products (Wizards of the Coast).

The companies that offer the best support have the most successful events and thus the best selling product. However, the core to success for events is that customer volunteer, who does this for the love of the game along with a bonus, like product discounts or swag. I mention all this because many people come to the store expecting us to host events, when in fact, we're expecting them to host events! We will ocassionally hold larger events, such as mini-cons, auctions, release tournaments and the like, but for bread and butter events, stuff that takes place weekly, it's the customer volunteers who make it happen.

If there's an event you would like to see us provide, consider becoming the organizer. You were gong to be there anyway, now you're just responsible for a small amount of administration in exchange for a store discount or minor compensation. This does not include your D&D group or weekly game, we're talking about open to the public events that promote the games we sell. Right now we're hoping to find coordinators for some of our more popular miniature games, like Warhammer Fantasy and Flames of War. We have no volunteers to run these events, therefore there are currently no events. We're mostly interested in promoting popular games that inexplicably lack organized play, as opposed to some new, untried game, although you're welcome to give that a shot. We're always looking for demo people to promote games they love.

At the end of the day, many games live and die on their in-store play. Those that are promoted in-store sell better and show us customer interest. Those without events are always on the fence, looked at suspiciously when it's time to restock product. There are exceptions, with role-playing games and board games bucking the trend, but most collectible games and miniature war games are looked at more closely when nobody cares to play them in the store. So if you want to see an event in the store, just show up and run it. We'll make it worth your while.

Holiday Recommendation Blahs

It's that time of year again when newspapers pay attention to board games for a few weeks before going back to scaring the bejesus out of everyone with what they think is wrong with the world. Yes, I am a bid jaded, and it's because people pay attention to these articles. Most of them ignore the dozens of excellent games that have come into our little specialty realm over the last year, and instead focus on the annual mass market board game schlockfest. Hooray, another version of Scrabble, Sorry or Trivial Pursuit (which is not really a game). These articles I generally ignore, sending customers off to Wally-World and Toys R Us. I can't get these games at a reasonable price because the manufacturers won't sell them to me, so it makes little sense to stock them. It's the specialty game articles that are a pain in my back side.

These articles usually list some excellent games along with some real dogs. Unfortunately, people will not be deterred from their desire for these dogs, regardless of my persuasions. Instead, I've learned to stock these poop spewers, with the unfortunate result that nobody will ever buy them again once the holiday season is over. They suck. I know they suck. Everyone who has done an ounce of independent research knows they suck. But the newspaper says otherwise, so how could it suck? The best we can do is stock up and prepare for what we think people should buy, a wide assortment of excellent games in various cartegories with various price points. At the same time, while trying not to vomit, we stock up on the games from the newspaper articles, hopefully not too deeply unless we want to dump them on clearance in two years. It's best to just go with the flow and let these so-called self-informed customers do their shopping.

My advice? If you don't play board games now, there's nothing particularly thrilling or special about 2008 releases or the articles that highlight them. This is not the video game world where Madden 2008 suddenly invalidates the existence of Madden 2007. Get some advice on some solid games that have been around a few years. I still print out a newspaper article with game recommendations from 2004, because the article lists good games and nothing has changed that fact in four years. We also have a handout in the store listing good "starter" games at various price points. Some are new this year, some are more seasoned.

Business Failures

If you drive around, you'll see many empty store fronts, previously occupied by the small businesses of your community. A large number of them have disappeared lately, with the bad economy blamed for most of this. What non business owners probably don't realize is that many small businesses are regularly on the edge of failure. The first couple of years is the most vulnerable time for a small business, usually because most are under-capitalized and have failed to realize the extent of their start-up losses. Some of these new businesses have inexperienced owners who were unaware of the commitment required. So after those first couple of years, things improve, right? The failure rate goes down past this period, but it remains constant for the life of the business.

The idea that your chance of failure in year three is just as high as year ten or twenty is kind of frightening if you own a small business. It just doesn't get any easier. Worse, the risk in a small business is exceedingly high. To more conservative folks, the personal financial risks in running a small business are downright irresponsible. You have no unemployment or disability insurance. Your personal savings and credit are tied up in your small enterprise. You work longer hours without days off, sick days and most holidays. You have no 401K or health insurance unless you pay for it, a cost vastly higher than the average employee pays. In exchange for your life and financial security, you gain job satisfaction. Or at least you should.

Many small business owners who take all these risks, risks that do not subside over time, eventually burn out or decide they want the good life, like vacations, eventual retirement or college tuition for their children. Being an employee, even a low paid one, is often more financially rewarding than small business ownership. Then again, you need all those employee benefits to help you in your life of unhappy labor. Anyway, a recession on the horizon is the final straw that pushes many small business owners to close their businesses. In most small businesses there are limits to the likely financial rewards you can reap and no limit to the depths you can fall if you fail. Knowing you'll have a year of losses to make up with a razor thin margin in the future is enough to make many small business owners call it quits now, before the bloodletting.

Wasabi!

We played this beautiful game at board game night last evening. The concept is interesting, as each player pulls several sushi recipes and then has to pull the correct ingredients to be placed on the Scrabble-like board. Getting them in order gets you a bonus, a wasabi green cube worth an extra point. This is similar to Ticket to Ride's route building. However, unlike TTR, there are action cards that allow the board to change, including a chop, stack, and switch cards that manipulate the game tiles to create new combinations. That was when I realized it contained my most dreaded board gaming element, speed.

Gregarious, verbal types who can think fast on their feet tend to love these kinds of games, while us slow moving, deep thinking bovine types need more time to spin up our mental hard drives. If you love to plan out that five run combination several moves in advance, play Power Grid or Tikal, not Wasabi. It's a heart breaker for sloths like me. I went from "I really like this game," and "this is kinda neat," instantly over to "I really hate this game, and here's why..." It's also likely to result in the dreaded "analysis paralysis" if you've got that player who refuses to go with it and must check every possibility.

However, if you're looking for a light game, a filler game, or have that spouse or friend who gets bored with all the cogitation, Wasabi is probably a great choice. It's what I would recommend after tiring of a game like Carcassonne or for introducing board gaming to non-gamers. If you've got someone who is a fan of either sushi or Scrabble, they should find it enjoyable.

$34.95

Oddball Community

I've been thinking about a lot of the bad advice I got from other store owners before opening my store. Some, who now have failed game stores, informed me I would never make it this far. Owning a game store is not like being an employee of a business. If I post a question about a Cisco router to a tech forum, I can get decent information from anyone, anywhere in the world. The router is standardized, the engineer responding is likely certified, and there are only so many possibilities. If I ask a question in a game store forum I'll get a variety of answers, based on the variety of experiences and backgrounds of the owners. The responses are often wildly different and marginally useful.

Just about every game store owner who openly discusses the trade needs a little asterisk next to their name, with a footnote explaining their circumstances. Almost without exception, they've got an interesting story that informs everything they say. The list includes having secret Internet game stores that keep them afloat, family ties that launched them and keep them going, unique business models that can't be reproduced, ties into other tiers of the industry that provides them additional stability or insight, scandals or bankruptcies that put anything they say into doubt, and just a general lack of knowledge about various aspects of business they may be talking about. I'm not gossiping or casting aspersions, it's just the nature of small business, and I'm not exception. People start small businesses because of their eccentricities, and the nature of small business allows owners to become as eccentric as they can get away with.

On top of this, one size does not fit all in the game industry. Every business model is unique to its time and place, which is why you don't see a nationwide "Game World" chain. Advice given to me from a game store owner in the Midwest, who pays a quarter of my rent, is not necessarily valid. Likewise, my advice for quick turning of inventory because of the high cost of stocking it, isn't necessarily valid to those with low overhead. Some game store owners don't pay themselves. Some pay themselves too much. Some might get a salary, but work 80 hours a week, meaning they've internalized the costs of a second employee. Regardless of the owner, when getting advice from these people, consider not only their backgrounds, but their circumstances.

War Games MiniCon Photos

Baneblade Update

Another hour and I've got the treads and some of the details done. There's still a lot of work left. One observation is that the spray gun gives the vehicle an industrial look. That overspray and underspray looks like the Imperial Guard did a quick camo job with real spray guns. It's kind of like how washes make living models look more alive.

My next project is a gingerbread house....

Friday Results

It may be a sign of the hard economic times, but people called and came in to thank me for putting a flyer on their car. The two teams blanketed the area yesterday, braving cold weather and various security and law enforcement groups. Anyplace that had posted signs forbidding soliciting was skipped, but the teams hit up every other place until asked to stop, which happened a lot. What was the result?

We were open from 7:30am to 11pm and we doubled our gross sales for the day compared to last year, informed 2,000 people of our existence and special sale, and hopefully created some new, long-term customers. People were walking in with flyers and buying up toys and puzzles, but there was also game sale cross-over, which was the bulk of our sales, and at full price. Some people came in after getting a flyer, with hopes we had games on sale too, and although some were disappointed a few became new game customers. We also had unusually high turnout from our regulars. The high level of game sales meant our cost of goods was still in the acceptable range, something Best Buy and Fry's can't claim from yesterday. But did we make money?

Kinda. The net profit for the day covered the cost of the promotion, which made it a cash flow win in the short term and hopefully a new customer win in the long term. If we weren't going to drop a lot of the toys we sold, it would have been a loser, since we're essentially spending a lot of money to make a very tiny profit. This is why I say it works for us in this instance, but I don't recommend this strategy to anyone else. Clearance sales are great, but sales on product you're going to re-order is pointless. Since we're not re-ordering a lot of the toys, mostly because we have them in quantity or they haven't sold, we can pocket a lot of our inventory dollars, mostly to pay for other product. We covered our costs in day one, so any follow-up sales resulting from the promotion should be profitable (it's a 3 day promotion).

Finally, if we gain just a single long-term customer from the promotion, it was worth it as an investment. Right now we're focused on the short term and investing is the last thing on my mind, but this is the real value of advertising, creating long term customers. In any case, the store's marketing budget was offset to cover this promotion, so rather than more TV spots, we tried something new, and I think it was a success. All my direct analysis of whether the promotion worked or not is kind of moot, since the money came out of a pot already accounted for in my cost-of-goods. We won't do this particular type of guerrilla marketing again, but we'll be trying other low cost methods to drum up business.

Black Friday

This is normally not our day. Black Friday is when the big stores, who have been losing money all year, offer great bargains in hopes of luring people into their stores and finally making a profit. Most small stores let this day go by, and traditionally it turns out to be a normal Friday in regards to sales. Our customers take their time and leisurely shop throughout December. This year is different, as every retail store, including ours, is fighting for survival. We don't have a year of losing money to contend with, but every store took a hit with the poor October-November sales. We're leveraging all the work the big stores are doing by having our own sale, advertised by flyers on the cars of those out for bargains at the larger stores.

Nobody likes those car flyers, and you might vow never to shop at a store that puts one on your car. You know what? Those people weren't going to shop with us anyway. By offering them a targeted sale on the day they've gotten up early to get targeted sales, we're aligning ourselves as closely as possible with their interests: bargains. We'll have a legion of folks putting out those flyers in the surrounding area and if we get as little as a 3% response rate, I'll be pretty happy. Wish us luck!

The store should be open today by around 7am.

The View

Our customer loyalty software has been down for a couple weeks now. After consulting with the programmers and our POS consultants, it looks like a Microsoft Windows Vista update has prevented the program from accessing the registry. The programmer is working on it, but the advice from my IT guys is to go back to Windows XP, since that's what everyone is familiar with. When I upgraded to this new computer, I verified that Microsoft Retail Dynamics and the new loyalty software was compatible. Unfortunately, so few retailers are using Vista, supporting these programs on that platform is very difficult. So now we wait for the programmer to come up with a solution.

Steady Breathing

I originally wanted to title the post "holding my breath," since this is the last day of preparation before the holiday rush. After today, all the stocking up, decorating, marketing, and training will be put to the test. We'll also put to the test theories and common wisdom of what it means to run a game store in a recession. The planning and organizing is done, we just need to execute well, or watch the results of past executions (sounds ominous). It all hinges on the hopes that we're seeing something resembling normal economic activity and not some once in a century event. October was a national crisis for retailers, not just a slowdown. Every retailer dreads a recession, but as I was explaining to one my business partners the other night, I can handle a recession, I can plan for a recession, I just want a normal recession.

Black Friday Sale

Today is when I "officially" begin banging the drum for our Black Friday sale, despite a Facebook event and lots of hints to our toy customers. Toys and puzzles (I've added puzzles) will be 40% off on Friday, 30% off Saturday and 20% off Sunday. We've got a big guerrilla marketing push on Friday morning for this. Such a sale is generally not a good idea for a small specialty store, but this will be a clearance sale. Most of the toys will not be returning. If you know anyone interested, please print them out this flyer. Notice there are no dates on the flyer; we may repeat the same push in subsequent weekends, if turnout is low.

Also, don't forget that if your friends or relatives bring in your wish list on our form, you'll get double the paladin club points through December 25th.

Baneblade IV

Highlighting the camo lines is normally an inconsequential step in painting a vehicle, but on the baneblade it took a good 45 minutes. The lighter color is Codex Gray. I usually touch up the tank after this step, since it also allows me to clean up the lines if they went on unevenly.

Advice to Small Publishers

I posted this to rpg.net today:

The WOTC CEO called buying the familiar a "Flight to Quality," which probably sounds great if you're WOTC but kind of snarky if you're not a top tier publisher. Games supposedly do pretty well in a recession. This will be my first one owning a store, so I'm taking that on faith. As a store owner, I can echo this flight to quality sentiment and tell you hobbyist customers are still buying, but their buying patterns changed virtually overnight.

Customers are taking fewer chances and are buying and playing sure bets. A sure bet in my store for RPGs is D&D or Shadowrun. My small and smaller press RPG sales have slowed, some disappearing entirely within several months. Large miniature battles games are being replaced by cheaper skirmish games. Card players are carefully buying boosters of the latest sets, leaving back list product to gather dust. Board gamers are carefully comparing gaming value for their dollars, with games over $50 slowing to a crawl. As a side note, if you sell a lot of your stuff direct AND through distribution, don't be surprised if game stores start losing critical mass locally and stop carrying your product due to your competing with them directly. We've seen this happen on several lines and have heard it reported from several stores.

As for viability in a down market, ask yourself, is this game product going to be played or just read? There's the perception that a large percentage of RPG products are purchased for casual reading instead of in-game play. If your game product isn't going to hit the table anytime soon, it's going to have a hard time getting bought during these hard times. Customers are cutting back on these products.

Also remember that you are marketing to the game store owners as well. In the description of your game, what tells me that existing customers will want to jump on this product? It needs to be a) interesting, b) instantly useful at the table and c) at a great price point. Fail at any of these criteria and it won't get into my store. As a store owner, I must envision in my head the faces of the people who will be buying your product. If I can't envision a sure thing, I won't buy it. This has changed from just a few months ago when a certain percentage of my budget was used to take chances on interesting products, a kind of community service.

These customer trends are effecting retailer purchases which will eventually trend to distributors. Distributors are the gate keepers of the gaming world. You'll need to sell them on these same values just to get picked up. Distributors work off pre-orders and I'll tell you that they're probably just now seeing this change in buying habits. As a retailer, this week was my first pre-order experience in a down economy. Product lines that have done especially well since the downturn included inexpensive supplements, like those from Goodman Games and Mongoose Publishing.

Look on the Bright Side

Psychological panic and irrational fear is what got us into this mess, so some positive thinking couldn't hurt in trying to get us out. Lets look on the bright side of the news this week. It's yeah-but news, but still not so terrible:

91.8% of Californians are employed.
If the media would stop banging the Great Depression drum for a minute, they would notice that this doesn't come close to the 25% unemployment of that period. Bush extended unemployment benefits this week, a rare change of heart.

Bay Area home sales are up 39%.
Yes, prices are in the toilet, and many of these sales are foreclosures, but this clears out old inventories and creates a floor for the housing market. Banks won't stop sliding until they know the extent of the damages. It also means people are getting loans. Seems like a great time to buy, if you ask me.

Mortgage rates continue to fall.
They weren't budging despite government efforts during the credit freeze. My home equity line of credit rates is tied to the fed rate, and that means more money in my pocket with falling rates.

The Dow closed 500 points higher on Friday.
Now that Wall Street has learned Obama isn't a socialist--thanks John (Al Qaida hates him too), their fears have been set aside.

Gas prices fell to a 3-year low of around $2/gallon (that's an extra $125 a month for me)
This has been called an "implied stimulus." Did you notice you have extra money in your pocket? This is better than a government check. Prices are half what they were from the Summer high.

Unlike Bush, Obama has a plan for job growth.
Whether it's a good plan or a bad plan is irrelevant right now. A good leader starts with taking a leadership position.

Black Friday (next week) will see excellent bargains at many stores, including 40% off toys at Black Diamond Games.

So most people have jobs, they have money in their pockets, they finally have a leader responding to their problems, and stores are bending over backwards to entice them to buy gifts during the holiday season. Heck, pirates are front page news for a change instead of the economy. The key is not to distract the public, it's to distract the irresponsible media. Did I mention newspaper sales hit record levels in October?

Retail Holiday

My thoughts lately are that if there is no holiday season, there should be no "dead" first quarter for small retailers like me. If customers don't tap themselves out in December, then January should look fairly normal, minus a lot of new releases. This sales smoothing is just a theory. We're building our calendar with this in mind. If we're wrong, we'll just have a lot of sparsely attended evens. The "normal" January theory is the upside to predictions of a very dismal December. I can handle a dead holiday season if I the first quarter doesn't come along with it.

I'm not really expecting anything that bad. I'm expecting a reduction in sales of around 10% from the year before. It would be disappointing, of course, but not the end of the world. We're just working hard to capture more of the existing sales out there. The easiest thing to do is to attempt to get holiday list items bought from us moved higher up the list. Most parents, for example, don't walk into a store and ask for everything on a shopping list. They ask for a few items, usually based on price and list priority. Our shopping list program is an attempt to get more items on a list highlighted or even be the only shopping list (parents rarely go for that). A store holiday list with a bonus attached also emphasizes that a game should be purchased at our store, not just any store. I've had kids who think buying a game at a competing store is still a win for me, as if "games" is just one big company.

The other, much harder task is to bring in new customers. We're focusing on a toy sale, clearing out our toy section. Most game stores shouldn't do this, as it won't make them any money and they simply don't need to have a sale unless they want to dump product. For a normal marketing campaign, what has gelled in my mind is to emphasize to regular people, the great value in our games. A family board game, for example, is a traditional, social activity with far great value than other family activities, such as going to the movies, or even a video game. That's it in a nutshell, and it worked for Monopoly during the depression. If you're worried about price points of the typical $50 Euro game, remember that Monopoly was no bargain in the thirties. Remember that the big value competition with board games comes from television and games like the Wii. Stress the traditional and social elements to playing a board game.

Here's a list of those kinds of board games we've been playing in the store this Winter, created by Joe Baptist.

Confidence

October scared the heck out of me. We had two very good weeks, one being our best week on record, and then the bottom fell out. This was due to the stock market crash and the upcoming election, exacerbated to the extreme by the irresponsible media. It got Obama elected, but it left a swath of economic devastation throughout the country. Some businesses will never recover. Some like ours will take a long time to dig ourselves out of that hole, as customers simply hunkered down and stopped buying anything non-essential. This was across the board, and included industries that were so-called recession proof. This was not based in economics, this was a major crisis of confidence not seen since 9/11.

The good news is that the crisis appears to have run its course, ending at around midnight on November 5th, the day after the election. Things have appeared to have returned to a tentative normal, with sales rebounding instantly, although not quite up to normal levels. It took October for everyone to be shocked into acknowledging that we are, in fact, in a recession. Our regular customers have bounced back for the most part, but the muggles, the rest of the world, are still extremely cautious with their money. We'll be fighting for every dollar this holiday season.

Will the holiday season be a bloodbath for retailers, or will we see a decrease in sales in the single digits? That's what retailers are wondering. I've decided we're not stocking for the holidays. We'll treat it like a regular period, although we'll bring in key, low-cost holiday sellers in larger quantities. If there is a blood bath, retailers and manufacturers won't fully experience it until early 2009, when they feel the crawl of first quarter revenue and notice there's no cushion from their holiday sales. Some will fold then, while others will hunker down and simply stop spending on anything to get through it. This will create some clear winners and losers, as stronger companies gain market share and are better positioned to succeed. It would be a fantastic time to start a business, by the way, assuming you had capital and enough start up losses to get you through the year. Better yet, buy an existing distressed business. With crisis comes opportunity.