The biggest issue of late about kickstarter has been the
issue of Kickstarter “taking the cream off the top of the sale” business
model. But what if Kickstarter has
caused the “ Privatization of retailing for customers”? Privatization as defined by Wikipedia is the
process of transferring ownership of a business, enterprise, agency, public
service or public property from the public sector (a government) to the private
sector, either to a business that operate for a profit or to a non-profit
organization. What many have been accusing Kickstarter of is doing something
similar to that. Kickstarter is taking the “ownership of the sale” from the
retailer and placing it in the hands of the manufacturer. This places the manufacturer in the sale role
as the retailer, which of course upsets the retailer. Who owns the customers,
if a product can never/will never be sold in a retailer location and only from
the manufacturer directly?
Many retailers have complained with manufacturers becoming
retailers (but many retailers don’t seem to have this same complaint with Apple
doing this) but with the recent release of Marvel Comic new Marvel InfiniteComic line, I have to wonder what might be the future of retailers in the comic
space which of course would come to the gaming space. If Marvel has decided that the “infinite
canvas” is the future of their products, where does that leave the retailer? While I think of the whole infinite comic
look reminds me a little too much of the late 1960s Marvel Comic cartoon where
they use the artwork and simulated motion to make it “animated”, many feel this
is the way of the future. What is old is new again. The Infinite comics give
you the “perception” of movement but without those costly animators.
Now here is something that will sound even crazier, but what
if Marvel Comic started doing retail stores? Now many retailers are laughing right
now saying it would never happen. But what if Marvel copied the Best Buy / GeekSquad business model? Marvel open stores inside of other retailer store
locations. Maybe 500 sq.ft to a maximum of 1,000 sq.ft is this locations size.
These stores only focus on selling the “best” of the new comics and graphic
novels only. Marvel gets to sell in stores; the store get comic fan base as
customers; Marvel make a better percentage selling direct to customers; The
store gets a percentage of the sales from Marvel. And where does this leave the
current retail model? Video game companies have been doing something like this
for years in GameStop. Why could this not work in coming and gaming stores?
Maybe Marvel stores in Disney stores?
The part that really makes this whole think interesting to
me is that Kickstarter and the other various online crowd funding copy cats are
the real power in all of this. They use the “Hostage” or “Patron” business
model and updated it for the 21st century. So if you have a good
idea, can make a good video, have a large enough “tribe” of followers, and can
amplify you messages “loud enough” then you can success at this over and OVER
again. While many of these Kickstarter do have retailer rewards, I have heard
responses from retailer saying they would not support Kickstarter projects (see my post on February 6, 21013 labeled “Angry retailer tells me how he feelsabout Kickstarter, Paizo, Free RPG Day and his customers…”). It looks like Kickstarter,
retailers, and manufactures are headed to a showdown that somebody is going to
win and somebody is going to lose it all. So what do you think? What do you
think about the “ Privatization of retailing for customers”? Talk to you later…
Great article.
ReplyDeleteSeveral retailers have responded to this in my facebook thread: https://www.facebook.com/louis.j.porter so I am including it to see the complete responses to this topic.
ReplyDeleteKickstarter hasn't done this. This has been going on for 20+ years. This is just the latest in the series of changes that made this the case. Publishers sending customers direct market catelogues in the 80's and 90's, this was going on. When game stores stopped carrying everything available after the d20 boom, this was going on. When PDFs became a growing market, this was going on. And now it is Kickstarter. Same thing. New way it is happening.
ReplyDeleteGamestop, retail sale of video games, and the secondhand used market are all going to disappear with the next generation of consoles since they will feature digital only new releases. There are plenty of sites debating whether fully digital content is good or bad, so I won't belabor the point.
ReplyDeleteComics will also be fully digital soon, baring a few printed collections and graphic novels. DC and Marvel are really pushing this and 2000AD has cut back many of their reprint plans in favor of digital. I doubt any but one or two Disney World stores would ever work out.
Online discount sales probably hurt game stores way more than Kickstarter does. I can see the support for Kickstarters fading away, since most of the games offered now go into a normal release cycle eventually and most consumers prefer to buy something available now, to play with now, rather than something that might come out in 2014.
My group doesn't support any of them anymore
What's interesting though is many KSes have tiers only for game stores. The Freeport one for instance, gets you the book for half price of what fans have to pay.
ReplyDeleteThe fragmentation of the social community by Kickstarter is setting the gaming industry back to the 1990's with every new release. For the past decade quality game stores have worked diligently to break the mold and grow communities at tables in their stores rather than the stereotypical hole in the wall card and rpg shop.
ReplyDeleteKickstarter even with the 'Retailer Tier' directly restricts the growth of the social gaming community be taking the alpha game fan out of the equation at the time when they can have the most positive impact on the entire system; and the product being delivered.
They get it through the e-commerce delivery system; with very limited exposure in the local gaming community. They do not have to come to a store order it;talk about it; and do latent promotion of the product by doing so; nor are they encouraged to do so.
In fact the entire system creates an environment that actively discourages the biggest fans from ever setting foot in a community setting that would 'grow the game' so to speak.
That being said there are a few things that manufacturers can do to alleviate this and actually work with retailers rather than dangling the worm of discount product in front of them (which IMO is a very poor use of retail capital as well)
Manufacturers can offer free pick-up with first out the door shipping at a B&M retailer programs that reward retailers for providing a centralized location for pick-up, and a charged delivery to private residence that ship later. This would 'cost' nothing and would go a very long way in showing that a manufacturer wants to work with a retailer.
Offer a retailer locator as part of the Kickstarter as well. Where can you pick up your game first. Reach out to high quality retailers, build a list and work on building relationships that last rather than destroying them before they ever get established.
Finally - realize that in the end you have two choices. One is to Kickstart a game and hope your marketing and the Kickstarter network is sufficient to meet your entire sales goal for each individual product; or build relationships and develop a gaming community that will support your company and product lines over time; and will work with you to 'grow the game' because the retailers involved have a solid financial incentive to do so.
Right now there is not a good financial incentive for a retailer to support the vast majority of these programs - simply because it ties up our capital with products we can not sell for several months. That in the end is just poor business.