GameStop Continues Growth Despite Economy, DLC
By Mike Sharkey | Mar 18, 2010
Sales are up, more locations are coming, and the company has a DLC strategy of its own.
Project $10, Electronic Arts' carrot-dangling DLC strategy to entice gamers to choose new over used, isn't a threat to used-game retail king GameStop. In fact, the company's CEO sees the DLC trend as a positive thing for publishers, retailers, and consumers alike.
GameStop released its 2009 fiscal fourth quarter results today, and despite the industry's downturn and publishers' efforts to derail the company's bread-and-butter used game sales, Chief Executive Dan DeMatteo had only good news for investors.
"GameStop delivered its second highest earnings year ever in fiscal 2009, in spite of the weak worldwide economic environment," DeMatteo said in a statement. "We saw global market share growth as new software sales increased 1.2%, proving once again that the great entertainment value and exceptional service GameStop delivers resonates with our customers."
Fourth-quarter sales inched up 0.9% to $3.52 billion, and total 2009 sales increased 3.1% to $9.08 billion, GameStop reported, and the company is expecting 4% to 6% growth in 2010 in spite of DLC efforts like Project $10. "We don't believe that a $10 add-on piece of DLC is compelling to a used game buyer," DeMatteo said during the company's quarterly conference call. "Publishers can participate in our used business by offering add-on content for the most popular used titles, creating a win-win situation for publishers, retailers and consumers."
GameStop's CEO said DLC will soon become a regular add-on upsell, and consumers will be able to purchase new and used games with the downloadable content added in-store. And consumers will have even more GameStop locations to choose from: the company plans on opening 400 new stores in 2010.
