Walmart is now jumping into the used game trading industry with exchange kiosks. How does this impact Play N’ Trade and Game Stop? I’m certain this is a smart venture for Walmart. A friend of mine interviewed at RedBox and told me the kiosk business model when scaled is tremendously profitable, and I’m sure Walmart has first hand knowledged of this model from having the RedBox DVD kiosks in their stores. Additionally, attracting young teens into your brick-and-mortar stores undoubtedly is a strategic goal of Walmart.
How greatly this impacts Play N’ Trade and Gamestop is questionable. It is hard to spin this as “helping the industry” as surely Walmart will take more from competitors than it increases the
I contacted Larry Plotnick, CEO of Play N’ Trade for his reaction to the Walmart news. In response, Larry noted:
- We have been aware of this test for some time, and have discussed the use of similar kiosks within our own stores; however it does not fit within our business model.
- The impact of Walmart is taken very seriously, considering the size and scope of their business and we will be watching and tracking their progress in detail.
- We believe there is positive implications to Walmart “legitimizing” used game and trading to a larger/broader demographic
- We strongly believe that our customer service, product offering and immediate customer gratification creates a better overall trading venue then does a kiosk type environment.
- Studies have shown that the significant majority of game trading is done by serious/hardcore gamers that prefer to trade in games for new gaming product (which is typically done in specialty retail not in big box stores)
Larry’s points are fair. Walmart will never be able to create the gamer atmosphere of Play N’ Trade, and gaming is all about experience. Nevertheless, I predict that Walmart will expand the market for used games and trading, but eventually will siphon sales from the established players Play N’ Trade and Game Stop…in any industry there will always be some customers that will chase the best price.
More to come….