Commentary

If Experience And Image Trump All, Why Is GAME Being Rescued By Sports Direct?

There is a mantra moving around marketing circles that brands are no longer in the products or services game, they are all providers of experience. As such, marketing is in the throes of helping brands become experience businesses. Nobody in marketing or advertising who has read a headline or attended a conference can have avoided the trend of the day.

Now bear in mind that more than a third of all ecommerce spend goes the way of Amazon. Now further bear in mind that Mike Ashley is turning out to be the king of the high street and has just bought 26% of GAME, the troubled computer games retailer, via his Sports Direct empire. If you're wondering why this is raising eyebrows in the City, check out his admission he pays staff less than the minimum wage after he was ordered to appear before MPs to explain the treatment of his work force. This followed a Channel 4 undercover investigation of Sports Direct that shocked the country. 

Ok, so on the first point, Amazon's next day delivery and recommendations with easy check-out is a far better experience than most other ecommerce players. That is definitely true. But have you ever come across anyone who chose Amazon because of the experience? If we're honest, we all shop there because it's normally cheaper than the high street, because Amazon has no stores to run, and it's a lot more convenient and cost-effective than paying for parking and then searching round a physical store. Some experience, yes, but mostly cost, no?

Why pick out GAME, though? Well, it was only at the start of the year that I was talking to its Group Insights Director about their turnaround plan. It followed his very accomplished speech at last Autumn's Festival of Marketing in London where he outlined plans to take on the online 'box shifters' (ie. Amazon) with a new kind of experience you could only get from GAME in-store. 

The speech was fabulous, so was the interview that followed. The tech was pretty snazzy too. There is a mobile app that can scan games and show you a trailer of what they look like to play, as well as let you take a picture with a leading character, when a promotion is running, so you can share it in social media. More to the point, the GAME stores were being converted into areas where people could experience the titles on offer and compete with other gamers across the world. GAME was effectively trying to make the hobby more social, a little more rooted in the high street, while realising the majority of gaming will still happen in millennials' bedrooms. 

The transformation work had started in earnest last summer. As this summer beckoned, though, GAME issued a profit warning that instantly saw a little over a third wiped off the value of its shares at the end of last month. Sky News reported that at the end of June, when the announcement was made, GAME's shared had halved in value since the beginning of the year.

Now, when I spoke to GAME they were pretty clear that they were going through a tough time because there weren't many new blockbuster games coming out and, most importantly, the PS4 and Xbox One were a little long in the tooth, as was Nintendo's Wii. What they needed, what any high street retailer needed, is a big new platform to drive sales again. This Christmas, though, there would appear to be just a quality tweak for the Xbox One to the Xbox One S and the PS4 is not expected to be replaced by the PS5 for at least a year.

Presumably this is what Mike Ashley is betting on. That upgraded Xbox games may cause excitement this Christmas, but then the big money will roll in again when the PS5 comes out for Christmas 2018.

Whatever his intentions, one thing is for sure. Marketers are going to have to play two mantras off against what is actually physically happening on the high street. Consumers, it is often said, will only buy from brands they share a world view with and which have a purpose they associate with. Secondly, brands are all now in the experience game, and that trumps pricing. It offers consumers something they just can't get from the box shifters.

Well, the most controversial retailer on the UK high street has just stepped in to prop up GAME, the one retailer that was going all-out on experience to take on Amazon and Play.com which can only compete on price. The guy propping them up is synonymous with a poor track record on the treatment of his staff and recently defended himself in court against failure to comply with an alleged verbal agreement with the explanation that he is a "power drinker" who can't remember what he's promised. He also had to go on the record as not knowing a tea lady was using spying equipment on a group of MPs who had visited his premises to check on staff welfare.  

You get the picture? If it's all about experience, if experience trumps price and if we all buy from brands whose moral compass in pointing in the same direction as our's, how come Mike Ashley is winning on the high street? How comes GAME is losing against Amazon and Play.com and in need of propping up from Sports Direct?

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