Article written by Kris Lipscombe.
Published on 19/02/2012 at 02:00 PM.
Price drops, prices rises, better bundles; pricing seems to keep cropping up with increasing regularity since Activision decided to raise the price on Modern Warfare 2 above the then average RRP. Although there does seem to have been a slow price increase this generation, it’s not the increases from publishers that are fuelling much of the discussion; it’s the supermarkets.
Of course I don’t need to tell you about what stores such as Tesco and Asda are doing with game pricing in an attempt to get you to pick up a few loaves of bread at the same time. I’ve no idea just how effective these price incentives are as a loss-leader; to me it doesn’t seem likely that I’m going to pop into Asda, pick-up a copy of whatever new game I want and then do my shopping just because I happen to be there.
Picking up food typically doesn’t pop into my head when buying games, even if I’m in a supermarket. However, they keep happening so the supermarkets must be gaining something out of it.
Specialist retail is generally fought hard by the supermarkets.
It might be easy to blame this aggressive pricing from the supermarkets for the issues that the Game Group chain of stores seems to be suffering from right now, but it does seem they’re just piling on tops of the problems caused by the internet. It’s not even that internet stores have lower overheads resulting in lower prices, although that’s certainly one aspect of it. No, the real key is in the growth of comparative shopping and price comparison services online.
Although there’s always been an element of comparative shopping on the high street, the internet makes it so much simpler. If I’m shopping in brick and mortar stores, something I try and do regularly as it’s far more enjoyable than shopping online, I may well try and have a look at more than one store’s price if I can.
This takes at the very least the time of walking to another shop or two, and then searching for whatever you were after. It’s not always the quickest of approaches, but you can still get a bargain that way. Of course, it’s become a bit tougher since the choice on the high street have become sadly narrowed in the last few years, but you can still shop around if you chose to.
However, online it’s pretty trivial. Google’s shopping search is generally the first stop, but browser plugins in like Invisible Hand make it even more simple; search on one site and get an instant response as to whether or not there’s somewhere else offering the same product for less. Beyond even that there’s the crowd sourced sites like HotUKDeals and Cheap Ass Gamer, which don’t just get you the best deals online but in person as well.
The problem for physical stores is that they just can’t compete with the internet on price, particularly when it’s become so easy to check if an option is cheaper. I don’t think the internet will ever totally drive the physical market to die, but it’s clear that the situation right now (coupled with the massive price drops at supermarkets) is causing problems for many independent retailers and is even troubling the bigger chains.
These price wars and constant one upmanship between various retailers may be good for consumers but it does seem that ultimately it may be to the detriment of the market and games overall. Oh, there are certainly other factors at play (like the back and forth between retails and publishers over pre-owned games), but if this constant competitive pricing were to force someone like Game to step out of the market the effect would be significant and, in all likelihood, to the detriment of gaming as a whole.
Hopefully this is all just a phase, like the previous issues over the price of clothing and CDs in supermarkets, and we’ll see things stabilise soon. If we’re lucky it might be soon enough to stop anyone going out of business.