Friday, August 22, 2008

Cobra Kai

It didn't take long after the closing of the last local game store before we started being treated like the big bad meanie, the Cobra Kai dojo of game stores. At least it feels that way. Our inventory and prices were scrutinized, our staff professionalism questioned, and the problem customers of the area came in droves to test our kung fu.

I have to admit I felt a certain leverage, as if certain games could potentially survive or blow away based on our support. However, there's also that annoying sense of responsibility, as if granny will suffer if bridge score pads are not on our shelves. For us it's about opportunity and risk, not responsibility and support.

Where we need to re-focus is on finding a new competitor, someone bigger. My wife had this Guy Kawasaki book lying around called How to Drive Your Competition Crazy. I scanned it a bit, and the first rule was to pick a much larger competitor. Being a thorn in the side of the big bad meanie competitor is cool and chic, like Macintosh making IBM users look like 1984 drones. Doing the same thing to a smaller competitor is bullying. It's much easier to be the underdog. Americans like underdogs and it provides ready motivation to succeed. But where to aim when you envision yourself on top?

Regional competition is definitely not something I envision as the next step. Yes, we compete regionally already. People drive long distances to our store, just like they drive from here to other very good regional competitors. Our goal is to retain those people as much as possible, but it's folly to believe we're competing directly with these other stores for the majority of customers. We could spend a lot of money advertising to attract regional customers, and some of my regional competitors do that (a mistake, I think). I believe our competition is more nebulous, the Internet, big box stores and the various stores that take a small slice of our pie.

If you were to divide up our product mix pie and assign competitors, you wouldn't find a direct competitor, but you would find a bunch of smaller ones, each taking a bite out of the pie. Each of these stores have other core competencies, but sell one of our product areas as a sideline or minor part of their business (we do the same). The GW store sells Games Workshop, and much better than us, no doubt. The comic book store sells Heroclix much more sucessfully than us. How could they not be sucessful with a game based on their core competency?

Target seems to own Yu-Gi-Oh among the small kids. Barnes & Noble sells a ton of RPG books. Various card shops still exist, mostly sports cards places, and they sell Magic and whatever's profitable this month. These stores aren't IBM sized monolothic corporations, but they're probably our most direct competitors. The strategy is probably more subtle. We instead need to figure out how to do what we already do, but better. It doesn't make us less Cobra Kai, however. I wonder what Guy would say.


  1. I think this is an interesting post. But I believe there is a very dangerous trap being set when you start to think the only way to imporove is "do what we're doing, but do it better." Innovation and change should never be dismissed. Do you try to attract all the existing gamers in your area? Or do you try to create new gamers? Both? Each one of those requires a different focus. You go too far down one path, and you become less attractive to the other. Established game stores oftentimes slowly become very insular places; catering to their hardcore clientele. Which is oftentimes the very best short-term strategy....those hardcore folks spend a lot of money. However, if you aren't constantly and aggressively marketing to new/casual/younger gamers...decline is inevitable.

    This is all stuff you already know, I'm sure. But keep looking at the forest (and not the trees) every once in a while. I've seeen many a gamer store slide into that comfort zone, which is really just a slow death into mediocrity.

  2. Great response. The goal of the post is to avoid the trap you mention. How to do that is an interesting discussion. Thanks for reminding me not to ignore my back yard.

    One of the issues we discuss a lot is how to bring younger gamers into the store. Long standing game stores that ignore this often report a painful sales gap later on, a period of no growth because of their neglect of this group. It's definitely something we want to do, but are often stymied on the method, mostly because our youth events are sparsely attended. We'll keep working on a formula though.

    I suppose I could write an entire post on this: the importance of bringing in new, young players for the survival of the hobby and our store. Along with how freaking difficult it is.

    Another element of that is my plan to scale down "mass" advertising this fall in favor of community sponsorship, focused on schools and outside activities. I would also be interested in sponsoring a games in the classroom kind of program, perhaps providing free games with a sticker on them advertising our store. If Coke and Pepsi can sell on campus, why can't I provide a little something in exchange for exposure?

  3. High school newspaper ads can be very effective, especially at the private schools that tend to have a bit more disposable income. They are also cost effective.

    Getting one teacher on board can be priceless too. History or Stats for preference, as they can actually buy the games for use in the classroom. You have to couch things in terms they can put forward to the administration of the school, and provide an unpleasantly high discount to get such things started.

    Once the student plays and enjoys, though he's hooked, and grows into your nextgen gamer.

    My 2cents
    -The Griffin

  4. One of my favorite concepts comes from an executive at Coke back in the 80's. He said that Pepsi wasn't their competition. It was water. As in, when people drink water, they are not drinking Coke.

    So I think your competition isn't Target, comic books stores, etc. but altogether something different: like video game stores, the Internet, movie theaters, or whatever else keeps people from gaming.

    I agree with the other posts that you need to cultivate new players as we know current customers move away or just give up gaming over time.

    Just remember that your real competitor is the one you least expect!

  5. Your closest competitor is Fry's.

    You compete against them for disposable income for "grown up toys".

    They are much bigger than you.

    They are right across the parking lot.

    Everyone hates their customer service, bag checks, etc.

    How can you lose?

  6. Focusing on schools is a good idea. You have no idea how many of Kate's friends are really into reading fantasy because of Harry Potter but have never heard of D&D. Hitting the middle schools in the upper income areas would generate a lot of new gamers.

  7. Wow, I feel like I've got a team of consultants on this one. I think the answer is all of the above.

    My competition is the guy down the street selling Magic cards, the big box stores, the Internet and every place an "entertainment" dollar is spent other than my store.

    The entertainment dollar concept forces me to wonder how I can improve the in-store *experience* rather than how can I beat my competition. Part of that is in-store gaming, while part of that is focusing on high value products.

    The kids are the future of the hobby and the future of the store. Actively getting them involved benefits them and benefits us. Rather than having a monolithic IBM competitor, I think we can have a kind of post-competition model where we instead focus on the community.

  8. I agree that the notion of "getting involved with the community" is a powerful ally when trying to build a customer base. While buying ad-space in school newspapers is certainly a good option, have you considered trying to sponsor after-school game clubs? I visualize it as a more active way to introduce potential players to games, by actually bringing them into their lives. Naturally, certain games will be more appropriate for this idea than others; "Settlers of Catarn" would be an easier sell to the administration and the parents than, say... well, I'm sure everyone has their favorite "Not For Kids!" game to fill in this particular blank. It'll be a delicate balancing act: pleasing the parents and teachers with genuine educational opportunities, pleasing the kids with games that are so much fun that they forget that they're actually learning something, and pleasing the bill collectors with the whole family coming to the store to buy those games the kids have been playing in school. Getting everyone to look at the more interesting ones that Target and Walmart (pfui!) just don't seem to carry would be the next level of the exercise...

  9. I've talked with one of my customers, a department head at a local high school. His advice was to approach school districts directly and to focus on after school programs, when possible.

    Schools have no time for games in the classroom, I'm told, being too focused on teaching to the dreaded test. After school programs would be better, when they still exist.

    As for the actual games, there are a couple of approaches. For teachers who run such programs and know games, I can allow them to choose. For those who don't know such games, we can provide suggestions and even tutorials.

    There are plenty of euro board games, for example, that I can't imagine anyone objecting to (although having done this, parents can be freakin' morons, even if something is provided for free). I once taught as an assistant teacher at a junior high school. I was teaching some of the brighter kids with behavior problems Japanese. I had just graduated from college in Asian studies and it was what I knew. Parents complained that I wasn't teaching a more useful language for their downwardly mobile children, like Spanish. I don't speak Spanish and so no more Japanese.