GameStop Isn’t Ready To Give Up
- Share prices fluctuating near $5.
- ‘GameStop Reboot’ initiative announced.
- No word on trade-in value of pre-owned products.
In a time that seems like an eternity ago, GameStop was a juggernaut in video game retail. How times have changed, as GameStop has been on the ropes the last few years, with each passing month seeing the company more and more likely to throw in the towel. With share prices currently hovering around the $5 mark, and an upcoming plan to close more than 200 stores still on the table, the company has announced a new initiative to stop the downward spiral: the GameStop Reboot.
GameStop CEO George Sherman issued a statement alongside the announcement;
We are committed to acting with a sense of urgency to address the areas of the business that are critical to achieving long-term success and value creation for all our stakeholders. Our strategic plan is anchored on four tenets which include, optimizing the core business by driving efficiency and effectiveness, creating the social and cultural hub of gaming within each GameStop, building compelling digital capabilities, and transforming our vendor and partner relationships for an evolving video game industry.
Four tenets, while few in number, highlight some of the first steps the company plans to take to build a more stable foundation for a shifting marketplace. The tenets, as well as a swath of information regarding the current state of the company, can be found among its recent news release regarding second quarter fiscal reports for 2019. It’s quite the wall of text, so here are the tenets themselves for those who don’t have the time to read through the entire release.
- Optimize the Core: Optimize the core business by improving efficiency and effectiveness across the organization, including cost restructuring, inventory management optimization, adding and growing high margin product categories, and rationalizing the global store base.
- Become the Social / Cultural Hub for Gaming: Create the social and cultural hub of gaming across the GameStop platform by testing and improving existing core assets including the store experience, knowledgeable associates and the PowerUp Rewards loyalty program.
- Build Digital Platform: Build compelling digital capabilities, including the recent relaunch of GameStop.com, to reach customers more broadly across the omni-channel platform and give them the full spectrum of content and access to products they desire.
- Transform Vendor Partnerships: Transform our vendor and partner relationships to unlock additional high-margin revenue streams and optimize the lifetime value of every customer.
At the very least, it looks like GameStop has a plan outline for going forward but if the second quarter reports and the general trend of the last few years are anything to go by, it’s going to get worse for the company before it gets better.