It’s hard to believe when you are looking for gaming news and you find a fluff piece full of speculation with facts that have nothing to do with their point. Engadet had a piece that explains the recently announce GameStop sales decline comes from the fact that there is no new console being released. It is a completely asinine story that makes you think this was on the level of GameSpot not Engadget.
It is known that GameStop isn’t the venue it used to be. It is a shadow of its former self in the new digital economy. Especially when online publishers are offering amazing deals online, there is no real need to purchase physical games.
The main point of their conclusion comes from the video game store’s Q1 profits fell to $6.8 million, which was a quarter of what they were a year earlier, based on a steep 35 percent drop in new hardware sales. And that’s after accounting for the Nintendo Switch’s strong performance.
Now, you could make the argument that GameStop is in trouble, but using consoles as the reason? The article its states that “GameStop didn’t explain the decline”. However, they came to the weird conclusion that because “gamers knew the next PlayStation and Xbox “Scarlett” were on the horizon — there wasn’t much point to buying a current-gen system.”
Retailers never made much profit on consoles. Anyone that has any basic knowledge about technical sales knows that prices for console (like televisions, Apple or Samsung devices) have set prices. Their profit margin is very fixed. Anyone with any general retail knowledge knows that vast profits come from peripherals like cords, off-brand controllers, used games, and after-market merchandise.
The writer of this piece is using the methodology of GameStop sales decline to get clicks and uses no knowledge of business. They speculate that consoles are the big reason for the decline, when GameStop never made huge profits from current-gen consoles. Not only that, but how do you explain sales before? When the PlayStation 4 was on the horizon the companies still survived.