The Phantom Business and the Placeholder Customer

I recently read an article from someone who declared the hobby game store finally dead. In sixteen years of flogging this dead business model, I've seen many such articles. This is the "standing on the COVID corpses of dead game stores" version. What struck me about this article was the misperception of how stores run their event space.

This customer went to local game stores, used their game space paying some nominal fee, and bought all his games online. He had no idea how this game store could possibly operate under such conditions. He's choosing to ignore the busy register, ringing up sales, or the many customers that come in throughout the week to make purchases, all of them cheaper and easier online.

Put simply, he is not their customer. The nominal fee, social gatherer game, is not how stores survive and prosper. Their value proposition does not align with him. So why is he there and why is he confused? It's because he is the product, not the consumer. His living corpse is being used as a placeholder for actual customers who wish to engage in that stores value proposition, which is community. His role is filler, a cardboard stand in. He's more Facebook user than Amazon consumer. Unfortunately, store owners have a difficult time sifting the wheat from the chaff, so these people sit amongst the real customers, sometimes confused.

Many customers are eagerly awaiting stores to re-open their play space. There is tremendous demand for this not just because it is our core value proposition, but because it's an impossibly good value. Asking a nominal fee or tiny buy-in for access to this core feature doesn't begin to cover costs. And to a mercenary customer only interested in the best price, who takes advantage of this near free feature, it causes legitimate confusion. How do they do this? Why are my peers supporting this? So the game store is once again declared non viable.

The solution to this is to actually charge what that space is worth. I figure its value is at least the cost of a movie ticket, probably approaching $15 an evening. But will stores ever charge that amount for an evening of entertainment? Doubtful, but they should charge something. Do it for your bottom line. Do it to clear up confusion in the market place. Do it because you've seen this business model works without events and how events drag down your store to a micro managed chaos that impedes your progress in life. Or don't do it. The model was viable before. It's viable now.