GAMA Trade Show: Customer Service Seminar

Redhead smiling beauty Joann Gain from Jester's Playhouse at the GAMA Trade Show

GTS Speaker Joann Gain from Jester’s Playhouse

Joann Gain, head of the GAMA Retail Division and owner of Jester’s Playhouse, kicked off the GAMA Trade Show on Monday night, March 18 with a seminar on Customer Service. With Amazon and other internet retailers waiting in the wings with lower prices, retail stores must have the best customer service, Gain exhorted. With excellent customer service Gain has sold Jenga for three times as much as mass market retailers. Her simple advice? Treat customers with a friendly attitude. Leave your baggage at home. “Don’t just sell vanilla ice cream,” she advised. Provide customers with the products that mass market retailers cannot. Have a thorough knowledge of your inventory and what’s available; make sure your employees do as well. On this point, a retailer chimed in and shared that he has a Monday training meeting from 8-10 AM for his staff of nine so they can familiarize one another with new products.

While Gain made several other points, the seminar shifted into more of a roundtable with retailers sharing their problems and eliciting solutions from the other 22 retailers in the room. When the topic of customer reviews on sites like Google and Yelp came up, the general consensus was to ignore the negative reviews, but several retailers spoke up and said that they personally respond in a professional manner to negative reviews. Marcus King, head of Troll and Toad’s retail, responds to everything except Yelp. As someone who might know a thing or two about trolls on the internet, he pointed out that “Yelp is a swamp.” and that “Some people will hate you for absolutely no reason.”

Problem Customers

Unfortunately from attending the seminar it would seem that Magic players are hated for some very specific reasons. Joann Gain finally tired of one Magic player who had been a “pain in the butt” for over six years and hasn’t regretted banning him from the Jester’s Playhouse. Another retailer spoke up, describing his partner at his store as “an asshole” and said that his partner hates Magic players and is getting more and more aggressive when booting MTG players out of the store. Keeping it positive, Marcus King suggested “Have you tried to show him what percentage of sales are Magic?” A retailer in the back also keeps it positive in her own way and shared that at her store, she gives employees a paid break when she notices that they are getting too hostile with customers, asking them to take the time to rethink their employment and attitude. John Coviello from Little Shop of Magic revealed that he had to call the police recently to get a patron out of the store for the first time in 19 years. The gamer would not follow directions and became belligerent with store staff, Coviello said, but banning him has been worth it due to an improvement in the store’s atmosphere. Just as in Dave Wallace’s Building a Better Manager seminar, retailers agree that retaining troublesome patrons is seldom worthwhile. Retailers also revealed that NPCs are not necessarily Non Player Characters in game stores, but instead Non-Paying Customers.

Airing the Dirty Laundry: Body Odor

What happens when two dozen retailers come together? They complain about their customers’ body odor! Amazingly game store owners confirmed the gamer stereotype shared in every online discussion about what to bring to a gaming convention: deodorant. It’s such an issue that one game store owner keeps both his and hers spray deodorant (and has to replace them on a regular basis because they are being used). Another owner spoke up and said that she keeps Febreeze around for such cases, while a third owner said that he takes such smelly customers aside, out of anyone’s else’s hearing, and explains the odor problem to them. He reports that these conversations have never been disastrous and that the offending customers get the hint.

Customer Service for Customers’ Transactions

Talk switched back to a less odiferous conundrum: customers buying, selling, and trading within game stores. In general, the consensus seemed to be that most owners ban such transactions, with many of them moving to the parking lot instead. Other stores take a more proactive stance such as Little Shop of Magic. LSoM regularly hosts well-attended flea markets where customers can trade through the store with Little Shop taking three to four percent to cover credit card costs. Sellers receive a gift certificate for store credit for the agreed-upon price of the game or miniatures sold to another customer. At Troll and Toad, Marcus King does something similar, using gift coins instead of gift certificates, specially crafted by Reaper Miniatures. It’s a win-win situation with both retailers and their customers benefitting.

Smiling Joann Gain and Dean Kao at the GAMA Trade Show in Bally's

Relaxing After a Busy GTS 2013: Joann Gain (Jester’s Playhouse) and Dean Kao (Eudemonia)

GTS Seminar: Building a Better Manager

Having written about David Wallace’s Competitive Edge seminar at the 2012 GTS and transcribed his debate about Online Retailing with Jon Huston from Troll and Toad from later at the same show, I had high expectations when I went to Wallace’s Building a Better Manager two-hour retail seminar on Monday, March 18. Wallace didn’t disappoint and even brought another guest speaker with him in the form of Mike Brodeur, whom Wallace had promoted to General Manager overseeing his four Midwestern gaming stores. Wallace prefaced his seminar by pointing out that it’s one of the most difficult talks he’s worked on, due in part to the topic being such a “vague notion.” Before getting into the heart of his talk, Wallace also mentioned that he recently had to let go of one of a longtime employee and manager, but said that he owes the employee, “a debt of gratitude. He forced me to become better at management.”

What is Management

What is management, Wallace asked the crowd and waited as retailers slowly began to respond. He clarified, “If management is good for the company, why?” There were scattered answers that a manager is involved in teaching, coaching, and supervising. Wallace agreed that in general, management is confused with supervision. But Wallace pointed out that a supervisor of a plant is not supposed to change anything. He or she is to maintain the plant and keep its production going.

Wallace: Management IS Change

Instead Wallace proposed that management is change and further defined management as continuous improvement. Do we have different expectations for employees in their first week on the job and ones who have been working for several years? We expect employees to improve with experience, Wallace pointed out, before mentioning visiting stores where nothing has changed in five years. Getting employees to do the bare minimum is not management, but instead treading water.

He then brought up retailers spending 40, 60, or even 80 hours working their stores, cleaning, ringing customers up, handling product and finances, and dealing with employees. This is not actual management according to Wallace. The mechanics of running retail are just job skills, Wallace said, but “who’s managing when you’re busy working your store?” Wallace acknowledged that many retailers also work their own stores, but they must find time to manage them in order to improve.

David Wallace stands with brothers in red shirts at GAMA Trade Show

David Wallace Talks with Clifford and Chuck Robbins of The Game Empire Stores

If you don’t do it… it doesn’t get done.

“Management is not natural. It’s unnatural,” Wallace opined. It has to come from a person imposing his or her will and creating the change. He warned the attending retailers, “If you don’t do it – and it doesn’t get outsourced or delegated – it doesn’t get done.” Retailers wishing that they had more attractive displays or better in-store play for customers will do just that, wish. Management is getting those changes made and it’s not easy. Wallace also advised retailers not to bite off more than they can chew when it comes to making changes. Instead, they should pick one or two things to improve on at a time.

When Management is About People…

Wallace is adamant that friendship cannot be used as a substitute for management, nor should an effective manager be swayed by familial ties. Five years ago Wallace fired his General Manager, his brother, during a dark period when his company was saddled with debt and facing bankruptcy. Within a short period of time, Wallace says, he was “debt free, back in [the] black.” Wallace was clear in his advice to retailers intent on implementing change: “If you have someone who refuses to go along, just get rid of him.” In the long run, being able to achieve continuous improvements is worth the loss.

gamatradeshow2013thefantasyshopgeneralmanagermikebrodeur

The Fantasy Shop General Manager Mike Brodeur

Wallace, who at one point had nine gaming stores but is now back down to four, also brought up interpersonal and communication skills as necessary to an effective manager. Knowing his audience well, Wallace smiled and said, “I’m going to guess that a few of you play World of Warcraft?” He compared employees’ love of feedback on their job performances to gaining points in the Fishing skill. We all love to see immediate feedback on our improvement. Brodeur agreed, but framed negative management as hearing “the Imperial March” when a manager walks in the room and employees dreading being “Force Choked” by their management. Brodeur’s Star Wars references didn’t stop there. For Brodeur, the allure of management by authority is akin to the Dark Side, brutal and expedient. Instead, Brodeur says managers should be patient and cultivate their employees much as Obi-Won and the Jedi Council would do with their padawans. It can be hard for managers to resist this “seduction of authority”, Brodeur admitted, but ultimately if they want to invest their employees in the company, they must. It’s the difference between a manager telling an employee to empty the trash, compared to one who asks the employee “What should you be doing now, John?” The nurtured employees begin to suggest and make their own improvements.

The Effects of Wallace’s Changes in Management

Wallace’s sales are “going up, up, up” and his business is enjoying 20% growth. Now his employee “turnover is next to nothing” at his Fantasy Shop Comics & Games stores in Saint Louis, Missouri. There have been other benefits as well. Mike Brodeur chimed in to point out that management meetings “used to be a courthouse; now they’re a classroom.” Wallace echoed the sentiment, saying that “meetings have become a joy for him.”

“The only thing I do well is learn from my mistakes,” Wallace said with no trace of irony. After 32 years in the business he is still learning, but his success has also enabled him to live more on his own terms. While Wallace and wife Kelli spend most of the year in Colorado Springs, they enjoy traveling around the country. David Wallace plays World of Warcraft when he wants to and was pleased to say that he doesn’t have to have a phone.

2012 GAMA Trade Show – Online Retail Debate

On Thursday, March 15th of the 2012 GAMA Trade Show there was a panel on Online Retail in the Pacific Ballroom, which is where the lunches and dinners are held. Based on the size of the event’s room, I figured it would be important and made my way to a table in the front of the room. As I began to write down notes, I turned on my voice recorder, in case I missed anything. The following is my transcript of the fascinating, 50-minute debate that ensued. I have made very minor edits for the sake of clarity.

Introduction to the Online Retailing Panel

Michael Stackpole: Our esteemed panelists here represent both online retailing and brick and mortar retailing. What we wanted to do – instead of having a knife fight, which would have been entertaining, but the room is too big and we didn’t have it in the round, so we just sort of scrapped that plan – we want to have a dialogue about this, the whole idea being that we want to take a look at what strategies, what solutions people have been using, how we deal with this both as an industry and as manufacturers and as retailers. Hopefully, the intention is that by the end of this particular seminar you’ll have some ideas, you’ll have some information, you’ll have some perspective so that you’re not worrying about this overmuch, and you’ll have some strategies then that you could work with both by yourself and in consultation with manufacturers and with other retailers to find a way to make the internet and everything work for you.

So I’ve got a series of questions and our panelists have been prepped with these questions. We’re going to go with somewhat of a presidential debate debate style. We will have the question being asked, we will have a commentary and a rebuttal, and we will switch back and forth. We will probably at some point go off-script just because, as this discussion goes on, we’ll want to emphasize certain things. I don’t know if we will have time for questions. If we do, I’ll attempt to facilitate those. For right now, we just want to sort of have a discussion and get information out.

The Advantages to the Game Industry From Online Discount Vendors

Michael Stackpole: So the very first question I’ve got for you guys is this, what are the advantages for the industry – not just being individual merchants – of online discount vendors? What do online discounters bring to our overall community to keep it vibrant and going? John, you’ll go first.

Orange and blue checkerboard floor at Titan's Entertainment Cafe with over 200 board games

2011 GAMA Best Designed Store: Titan’s Entertainment Cafe

Jon Huston: This would depend on which kind of online discount retailer. But I would say that the number one thing that an online discount retailer brings to the industry is not the discounted price, it’s the selection of goods. In almost every case, a good solid online discounter retailer is able to provide far more selection of goods in their storefront than would either make sense or be suitable for sale in a brick and mortar store. Our impression from the customers that we get is that the majority of customers that buy from us, buy from us because the particular good that they want to buy is not available to them locally. They’re not buying from us because they’re trying to get a better price. Now, in that particular regard, this is where I got to admit that we are not the cheapest online discount retailer. In fact, we’re probably not even the top twenty percent on most of the stuff we sell. So for those who are focused entirely on price, we should probably not be their first choice, but those who are looking for selection that’s where we emphasize our product line. By being able to offer such a wide selection of stuff, it’s allowed manufacturers who are more into the long tail of goods to be able to have a platform to sell those goods from. I don’t think we would have five or six thousand different board games in print right now, if there was not an online retailer presence, because such a small number of those board games would be able to be carried by any one store. I was just at the Store Design seminar earlier today, which was a store [Titan’s Entertainment Cafe] that won an award last year for Best Designed Store and the store is very proud that they actually carry 200 different board games and I know from going to stores that 200 different board games is an incredible selection, but that also represents about three percent of all the board games currently in print today.

Michael Stackpole: (Jon, just give yourself a brief introduction just so…)

Jon Huston: Alright. I’m Jon Huston. I’m the CEO of Troll and Toad. Troll and Toad started off as a mail order game retailer in 1994 and as the internet came into being we switched from being mail order magazine advertiser over to an online website and currently we’re one of the larger presences on the web for the hobby game industry itself.

David Wallace: Good afternoon. I’m Dave Wallace. I’m a brick and mortar retailer. I opened our first store back in 1981. I’ve got 4 stores in St. Louis right now. I’m going to surprise, I think, a lot of people at this, by telling you that I agree with a lot of what Jon has to say. I don’t see the internet seller as an extreme danger to us. I think it’s important to keep a few key facts in mind. Let’s assume for the sake of argument, brick and mortar stores. There are three stores in your town and everybody is doing 300,000 in sales, and one of the stores goes under, does that mean that the other 2 stores are now going to pick up that 300,000? No. It doesn’t. No, usually it’d be tough and a stress to pick up 5 to 10 percent of it. Most of those customers simply leave the market. If we have two stores doing 300,000, somebody else opens up a shop and they go up to 400,000 in sales, does that mean the first two are now out of business or struggling? No. The point is that each business builds its own customer base. We only tend to poach about 5 to 10 percent of our customers off of each other. It seems like a much higher number, but the reality is each business generates its own customer base. Online sellers generate on the most part, their own customer base.

Remember too that most of the stuff they sell is stuff we don’t sell, secondary market, out of print material. Jon carries more product than you could fit into most of our stores. If we don’t sell the product, then we’re not very well in competition with him. If they sell to people who aren’t interested in buying from us, then we’re not much in competition to him. I would argue that this industry as a whole is seeing more money coming into it because of internet sellers. However, I think it’s key to note, that the internet sellers primarily sell only to existing customers. They don’t create new customers. What they’ve done is they’ve captured, they’ve retained some of those customers that would have left the industry earlier, but now with the option of buying online, we have more of them sticking around, especially because they can also sell products to people and Jon. So do I believe that the industry is larger? Yes, because I think that we’ve retained people that we would have lost otherwise.

However, most of the money that’s being made by the online people, I don’t think [remains] in the industry. Selling secondary market and out of product materials, doesn’t put money into the new manufacturers’ pockets, it doesn’t help the new retailer, it doesn’t help the industry as a whole. It’s certainly great for the online discounter, but it’s not necessarily helping the industry, so yes, I think we’re a larger industry, I think we have more money, I think we’re retaining more people, and I think that the online people are benefiting from that tremendously, and I don’t see them as as much competition as most people fear them. But I also don’t see that extra money as benefiting the industry as a whole, so much as benefiting just the online retailer. Thank you.

Controlling Online Discounting: Realistic or Not?

Michael Stackpole: These guys are being a lot more reasonable than they would’ve been if we’d just given them sharpened spoons and tossed them into a locked room. [Laughter.] Really annoying. Alright so given what you guys have said, given that online retailers seem to be selling a lot of product that’s not available in store and Dave’s contention that the customer base that they’re selling to may not be a customer base which is attached to a store, the next question that I have to ask is is it then realistic then to suggest or suppose that online discounting, or discounting in any sort can be curtailed? Is there a way to control this?

Just to steal something that John and I in an earlier conversation had, you know, one of the largest discount retailers in the world on the internet is not a game retailer, it’s Amazon. And we’ve seen what Amazon has done elsewhere, so do you think that it’s possible that there are going to be efforts to curtail this stuff and control this stuff that would be effective? And if not, what are the strategies that we have to use as an industry to promote what goes on? Do we run a risk, if everybody looks at the internet and says “Because there were discounters, internet is bad, therefore I will keep my store firmly in the 18th century.” Or is there a way to sort of say, “Let’s decouple the ecommerce the e-commerce side and the negativity there and look at the other good thing the internet is good for, which is delivering information.” Are there things that our stores can do to use that half of the internet to both grow the industry and to increase what goes on? And I’ll start with you, Dave.

David Wallace: Alright, I think to address the subject, the first thing we all have to recognize: discounting did not come into play with the internet. I mean, come on, 30 years, how many stores out there discount? How many of you retailers [are] listening to “The guy down the street will sell it for 20, if you’re not going to match his price, I’m going to buy it elsewhere.”? It’s nothing new. However I do think the internet has changed discounting from the way it used to be. The two key elements that come into play here is that first off the threshold to enter business has dropped to nothing. If you want to open up a brick and mortar store, even if you’re doing it on a shoestring, you need to have enough resources to get a good shot at it. If you want to open up an online discounting store, 12 year old kids working out of their bedrooms are doing it. 60 year old grandmothers are doing it to supplement their business. You don’t have to have any resources. You can simply go into business. You don’t have to have an infrastructure. You don’t have to have a warehouse. You don’t have to have inventory. You don’t have to have employees. So that has certainly changed from what discounting used to be. That lack of infrastructure is what leads to customers saying to you “Well, you bought it for 10, why don’t you sell it to me for 11? You’re still making a profit.” I’m still making a profit? You’re right, it’s 1 dollar. The problem is is that inventory is only one of the things that I have to pay for, my infrastructure, my fixed costs, my labor costs, exceed that 10 percent that the dollar represents. I cannot run my business in that fashion. The business model will not allow for it. But for that 12 year old, inventory cost is the only expense he faces. Now John ironically here has larger fixed costs and labor costs than any of the retailers in this room. Trust me, if you look at his bills, you’d appreciate how well you have it. He knows that he can’t get away with that on the internet, but that 12 year old can. That’s why we see this incredible push towards, you know, I have to sell it for a 1 percent profit margin. Do I think that the manufacturers can change this?

Manufacturers, please don’t misunderstand me, thank you. I appreciate your gestures. I appreciate what you’re trying to do, but the reality is, it’s all symbolic, you can’t stop discounting from taking place. Nobody can stop discounting from taking place. John is not buying direct from the manufacturers. He’s not signing contracts with them agreeing not to discount. They can’t control it. I do appreciate their efforts, mainly because I appreciate their support. It says that we believe in you and we want to see you successful and I’m going to argue a little bit later that they need us to be successful. But in the end I don’t really see manufacturers curtailing discounting and stopping it from affecting us. Like it or not, it’s what we live in. In an ideal world, if discounters didn’t exist, would we be better off? Come on, we don’t live in an ideal world. Realistically let’s get on with what we need to. John?

Jon Huston: What I’d like to focus on is talking about what some manufacturers have done so far in their desire to control or reduce online discounting. Dave was actually wrong in one of his facts, that we did not sign agreements with manufacturers about price. We’ve actually signed agreements with two manufactuers about price and stuck to that agreement. One is Mayfair Games, one is USAopoly. And before I came here, oh! And actually a third one about location. We’ve actually signed an agreement with Games Workshop. Each of those three companies have a different set of rules. The Games Workshop rule is if you sign a deal with them, you cannot sell online, at least using a cart. Since we use a cart we don’t list their stuff on our website. We signed the deal with Games Workshop because we sell Games Workshop in both of our retail stores. USAopoly, that was something that only happened in the last 3 to 6 months. USAopoly had us sign an agreement that we would sell things only at Suggested Retail Price, I think that’s what it was. And Mayfair’s had an agreement for several years, 4 or 5 years, something like that, that we have to sell everything at a maximum discount of 20 percent. That is, we have to sell everything at 80 percent or more. That puts Settlers of Catan, by the way, [at] $33.60. So I had one of my staff study the internet just before I came here to look for the effect on those three manufacturers. He found that Games Workshop, which is not supposed to have anything for sale on the internet, actually found vast quantities of their stuff for sale on both Amazon and eBay. USAopoly which is supposed to have everything Suggested Retail and hopefully USAopoly won’t be mad at me saying this about them, is they don’t seem to be enforcing it, or they don’t seem to be successful in enforcing it, because he [John’s researcher] was hard pressed to find the stuff at suggested retail from anyone. But the third company, Mayfair, which has been enforcing their policy for a number of years, it was very difficult for him to find Settlers of Catan for less than $33.60.

There’s actually a website out there, if you want to study Amazon pricing on any item for the last two, three years, the website’s called camelcamelcamel.com. See you don’t even have to write it down, a brilliant name, you go to camelcamelcamel.com, you can pick Amazon off the list, type the name of the item or its UPC code, you can look at Settlers of Catan and see that other than two or three ocurrences over the last year that Settlers of Catan has been on Amazon, it’s stuck at $33.60. That’s what their price has been. What my staff member said to me, and I agreed with him, is that if a manufacturer wants to set a reasonable online price and is willing to enforce it and spend the time to enforce it, I believe that that manufacturer could probably be able to maintain that price as they have for Settlers of Catan. I’m not sure whether or not that enforcement of that price really ends up having any effect overall on the success of that item among gamers or for the manufacturer themselves, but as far as it goes, manufacturers do have some ability to control online pricing, if they want to do so.

Do Game Stores Need to Shift to Serving as Community Hubs?

Michael Stackpole: Yeah, I think that one point I would just add to that as we saw in the book trade when Borders went out of business last year, that immediately affected Barnes & Noble, in terms of the fact that they were selling off all this stock, there’s no chance to enforce things at Manufacturers’ Suggested Retail Price and that did damage to Barnes & Noble, did damage to some independent bookstores. And if you have a retail outlet and the store on the other side of your town goes out of business and starts selling everything off, there’s going to be no enforcement, you’re going to take that hit regardless. So the enforcement of those discounts becomes a really tricky thing if that’s all you’re going to trust your future to. You need to be looking at certain other strategies, which brings me to my next question, and again, everybody who’s here probably already knows this. I know that we do have some brand new retailers and so I hope that your answers can address some of this for them.

What I’ve seen in the Phoenix area in the book market is that two very successful independent book stores have shifted from what they used to be to now being, in essence, event venues with a rather large gift shop attached to them. That’s how they’ve shifted what they do, it’s not just you’re going for the books, you’re going there because an author is going to be there or they are holding a class or they are having a workshop. And then you purchase those ancillary things. And again, you guys, what is that you see-, what are the resources that retailers have got, in this business, to do those sorts of things? Is that sort of shift neccessary? Is providing essentially that community hub, going to be the thing that successfully allows stores to flourish regardless of the availability of product on the net? What are your thoughts on that and what do you see, especially with your retail areas, that you do to make sure that your store flourishes regardless? So, we’ll start with you, John.

Jon Huston: This is where I have a good perspective, because we just opened a second retail store a little over three weeks ago. And we opened it in a small town of 7,000 people, only 7 miles away from a major online discount retailer. And we put everything in our store at Suggested Retail Price and keep in mind that that meant anyone coming into our store can, they can just drive 7 miles away and get it for a cheaper price from those Troll and Toad.com folks down the road and what’s even more embarassing is in our store we have a sign that says that the store is a Troll and Toad store, so some of our customers coming in want to know why we don’t match the prices online and we just let them know, that if they would like to buy from online, we recommend that they do. But in our store we don’t match online discounts. [Some laughter].

“For centuries, we’ve had places called taverns, and what a tavern is, it’s a place you can go in, and pay for alcohol 3 or 4 more times than a local store. So why the hell do people go into a tavern to buy a drink when they could just go across the road and get it cheaper? It’s because of the environment.”

– Jon Huston

Our store is doing very well. But the reason that our store is doing well is because we’re not trying to match the online discounter’s price, we realize that trying to discount is not going to be a successful way to do profit. I’m very sold on Dave’s talks that he’s done in earlier years that I’ve listened to, and he continues to preach that discounting in your store is ultimately just a way for you to get less money into your store. Instead, you should be focusing your store on what the online discounter cannot provide, which is the immediate experience of being able to provide them with a product in hand, to give them that community, to give ’em a store where they feel it’s worth paying more money. For centuries, we’ve had places called taverns, and what a tavern is, it’s a place you can go in, and pay for alcohol 3 or 4 more times than a local store. So why the hell do people go into a tavern to buy a drink when they could just go across the road and get it cheaper? It’s because of the environment. If you can put together an environement that makes people appreciate the environment they are in, most people are going to be willing to spend the money to help maintain that environment because they appreciate it.

David Wallace: I certainly want to address what they’re talking about, but before I do, I want to make what I think is a key point. Mike talked about brick and mortar stores being a portal into the industry, a way of creating customers. This is where I think that the industry in general has to wake up. I said earlier that the online discounter, the online retailer, basically services the existing gamer. They’re not creating new gamers. That’s what we need the brick and mortar stores for. 2-3,000 stores filled with goobers who love what they do so much that they can’t wait to share it with anybody that’ll stand there long enough to listen to them. This is how to create new people. Every industry suffers from attrition. You’re always losing people. If you don’t have a greater influx of new people than you have people going out the door, you’re going to eventually suffer and go out of business. This industry needs the brick and mortar store to create new customers. We are the missionaries who convert the heathen into gamers. [Laughter] As good as the online store can be, it will never succeed in doing that. The industry requires it. Now, how do we go about doing that?

Yes, values. Price is a value. There are people who like getting more for less money. That’s pretty much everyone. There is a percentage of our market share that price is the single most important value there is and they will shop online at those discounters no matter what. They’re not your customers. Stop thinking of them as your customers; they don’t belong to you. You will never get their business. If everybody else goes under and you’re the last store on the face of the earth, they still don’t want to give you any money. Alright? Price is all important to them. Fortunately price is not the only value that’s out there. I’ve listened for 10 to 12 years, people preaching to me, that I’m dead. You are a dinosaur. You’re extinct, you’re just too stupid to know it, lay down and die like you’re supposed to. You cannot compete on product, because they can get cheaper online. The fallacy behind this is that everybody that preaches this sees the buying public as one homogenous mass, that all value the same thing. I don’t know about you, but my sales are going up. And it’s not because my customers are too stupid to know that they have options out there. They have other values. John’s right; don’t compete on price, because that’s not what they were coming to you for in the first place. If you want to give away the money, they’ll take it. But they’re there for other reasons, they like your location, they like the time they spend in your store. It’s like walking into a garden, all the stress goes out of it, you’re just happy to be there. They love talking to people that share what they like. They like finding out about new stuff. They want to pick it up and hold it in their hands. They like the people that they meet in your store, the community that you have.

The key here is to recognize that not only can you not compete on price, but you don’t have to compete just on community. I’ve been told for 12 years, that the only way I’ll stay in business is by having an organized play and selling chips and soda. That’s crap. I can sell product from here to the next 50 years, because I provide other values, not price, and not just community service. There’s 50 ways you can go back and improve your store right now and improve the fact that people love shopping with you. Every one of those is bringing new people in and that’s where this industry’s getting its new customers.

What Should Game Manufacturers Do to Help Retailers?

Michael Stackpole: Again, no blood? This is really surprising me. I did for, just so you know, I did for a while manage a Flying Buffalo game store, so I have got a certain amount of experience and I’ve always felt that community is a core part of what we actually do. But I also notice that one of the problems that we have, and I’ll label it as a problem, is because we’re all gamers, we look for the rules, we try and figure out what the Victory Conditions are, and we invariably attempt to hack the rules. And we think of it as just this game and we tend to miss the idea that selling to people, retailing, is actually a much bigger game. And there are other places that do it very successfully and play very successfully. I think one of the things which is incumbent upon it, and I did this when I was managing the Flying Buffalo store, it’s incumbent upon all of us as retailers to go out to some of those other retail outlets whether it’s a Target or it’s a Wal-Mart, or it’s a Nordstrom’s. You know, I think if every retailer here went to a Nordstrom’s or a Neiman Marcus and just see how that they treat customers and we looked at how we can apply that to our audience and what we do, we would benefit greatly as a community.

So my next question, I’m going to start with Dave, is in this idea of we want the brick and mortar stores, because as you say, they are apostles, I’ve always seen games as being more shared as a disease vector, so this would be a virus hot spot. But we’ll go with missionaries and chapels and that sort of things, because it’s much more pleasant, and we are in Vegas where people are praying all the time [laughter], so what do you see, what are the things that you want to encourage manufacturers to do that they’re not doing enough of, or that have been really really successful that helps you spread the word, that helps you be that missionary to go ahead and grow. And you can talk about successful programs that you’ve seen or things that you would like to see, or things that you remember companies having done in the past that were very useful, and you know, have just fallen by the wayside, because unfortunately some of those companies have been culled down through the years. And that’s a question totally off script, so if they look like they’re deer in the headlights, now you know why.

David Wallace: Yeah, I’m going to start off by “Where did that come from?” Again, we add value, but we add value in different ways. A brick and mortar retailer that panics and sees the online business as competition, that thinks that the only way that they can match that competition is by matching price is cutting their own throat. First, let’s recognize the fact that they’re not competition, not seriously. We tend to deal with this as an emotional thing. Every one of us has had customers come into our store and say “You’re a crook. How dare you charge retail price. What the hell kind of a fool are you?” I love this story I heard from a guy that worked for Dream Pod 9. He had a guy come to their website, order a bunch of stuff, and when he gave him the price, the kid said “Well, why aren’t you giving it to me at cost?” And he said “Well, what would we pay our bills with and make a living?” And the kid told him, “Go out and get a job like the rest of us.” [Laughter]

Competition would suggest that we share something in common. If John sells two million dollars worth of Magic singles and Yu-Gi-Oh singles over the course of the year and you don’t sell singles, are you in competition? If he sells to customers who would never come into your store, is he really competing with you? The fact of the matter is that we don’t actually share a lot of competition. It’s the emotion. I don’t like being accused of being a crook because I charge full price. It hurts when somebody comes into my store and says “Even though I got into it because of you, and I love you, and you know, you came to my wedding. I’m going to buy online, I can’t support you anymore.” Emotionally it’s very difficult for us and mostly it’s fear. If I’m not successful, can I find a scapegoat? Can I blame it on someone else? But the reality is we don’t have that much competition. So if you turn around and give in and say that I have to compete with them and that I’ll do it on price, you’re not going to get anywhere. You can compete, but there’s not much competition to begin with. Don’t focus on the online store, you’re a brick and mortar store: they’re not your customers.

Most of them want to be in a place that they like going to. That’s what it comes down to. I enjoy being in your store. If coming into your store means you’ve got product on the shelves, somebody sitting behind a counter painting a fig, and they finally look up and say “Did you want fries with that?”, you’re not adding much value to their time in your shop. On the other hand, if you have some kickass displays, if being in your store is fun, if you’ve got hands-on, interactive, if you’re employees aren’t sitting behind a counter, if they’re out working with customers, if you’ve got demos, if you’ve got events, if you’ve got just wonderful product mix with unique and interesting things, and something new showing up every week, now you’re bringing value in in a lot of different ways. The only way that I’ll disagree with Mike: communtiy absolutely, positively, it’s an absolute value and you should take advantage of it. But to suggest that it’s the only one is ridiculous. You can run a store without any gaming space whatsoever and be tremendously successful by providing other values. You will never be able to please all the people all the time. It’s a guaranteed way to bankruptcy. This casino certainly doesn’t please all the people all the time. You don’t have to. Please the ones that you’re trying to take advantage of. Oh, that came out bad. [Laughter.] Please the ones that you’re there for, your targeted audience. Make your competitive edges line up and reinforce the people that you want to please. That person that wants you to sell at 35 percent off isn’t your customer. Stop trying to please them. Go back to the ones that you’re making money on. Those customers belong to John. Let him have them. They’re not yours.

Michael Stackpole: (…manufacturers?… Any one dream thing that you’d like to see from manufacturers?)

My sales are up. My store is healthy! I love what I do and I’m going to keep doing it.

– Dave Wallace

David Wallace: You know the only thing I can really say about manufacturers is not what I want them to do for me, it’s what I want them not to do. I don’t want them to panic. I don’t want to believe that we’re dinosaurs, that we don’t have a future. I don’t like it when a manufacturer starts trying to cut into my customers and cut me out of the loop… Paizo. [Applause.] I want my manufacturers to stand behind me. We are the sales force to them. What sense does it make to fire your sales force? If you go back to your stores and fire everybody that works behind the counter, what do you think’s going to happen? I don’t need them to give me any special deals and I don’t need them to break his back [Jon Huston and other online retailers] and tell him he can’t sell at a discount. I just need them to recognize that I’m not dead. My sales are up. My store is healthy! I love what I do and I’m going to keep doing it. Don’t give up on me. They don’t have to help me. They just don’t have to abandon me. [Applause.]

Jon Huston: I believe the essence of your question was “What could manufacturers do to help brick and mortar stores more, correct?” First, I’ll start by two things that I dont think actually help them. One is making limited edition items where you only get a few for each store. From my perspective, I see this as a way of just antagonizing people in that store, who want to know why they weren’t the ones who got it, the person behind the counter got it, or his best friend got it. It seems that that just kind of does a negative thing. And generally what will happen is this is going to drive up the price between those few lucky people that got into your store, [they] buy it, and then they send it to us or put it on Amazon or eBay themselves and make the extra money so that they can get the full price. The other thing that I’ve seen manufacturers do is do only a certain amount of product for each store location and I think that is a self-limiting factor because, again kind of like the limited edition thing, it means that you’re capping the success of any of the brick and mortar stores that you sell to. A brick and mortar store, say, in Chicago is probably going to be able to sell a lot more than a brick and mortar store in, say, Anchorage, Alaska, though the one in Anchorage, Alaska actually kicks pretty good butt; I’ve been to it. I probably should have picked Idaho instead. [Laughter] But those limitations aren’t good.

Fantasy Flight Games Media Center displaying FF logo on its iPad

The Fantasy Flight Media Center

Clear plastic dome of a Skylanders demo unit in a Kmart

Activision’s Skylanders Display in a Kmart

Where I could see manufacturers really helping out brick and mortar stores over online is first putting together really effective demo units for stores that would promote the merchandise, for when people see the promotional unit, they’re driven to buy the items right there. There’s a local K-Mart that has this beautiful display of all the Skylander figures in little rows. Now mind you that Skylander is so hot there’s no need for them to promote it anymore, but I was looking at that, thinking “Wow, if those kinds of things were made for retail stores, where they could buy them and put them in…” And then I realized that some retail stores do that; they have people paint the figures and bring them in and set them up in a glass showcase and they look so cool, people want to buy the figures so they can paint them themselves or often want to buy the painted figures and want to know why you won’t sell them to them. [Laughter] But the point is demonstration. Demo stuff like that, especially three dimensional demo stuff would, I think, be very strong for brick and mortar stores. This is what I’d like to ask, one question of the audience: for those of you who carry the Fantasy Flight Games iPad demo device in your store, if you feel that it’s increased the sales of Fantasy Flight Games in your store, could you raise your hand? Alright, so that’s an example, I think, of a rather low cost, you know, doesn’t take up a lot of space, and yet a manufacturer can use that and other things to promote sales in brick and mortar stores.

Is the Game Industry’s Current 3 Tier Distribution System Sustainable?

Michael Stackpole: To take from what both of you said, something that I always felt was very important again when I was managing the store, was something that I looked at, was that it is possible to manufacture demand for a particular product line in your store, provided you find a way to push it. I remember this was back in the Dark Ages, there was a game called Arduin Grimoire, which some of you may remember, and this again, back in the Dark Ages, saddle-stapled book, very hard to read, small type, horrible illustrations, but we stocked it just because we wanted to stock one of everything and back in those days you actually could. And I suddenly noticed that the game started to sell. And so we’d replace it and it would sell and replace it and it would sell. In the course of six weeks, we moved six copies and then it stopped selling and I was totally baffled as to why that had actually been [the case]. Then I found out that one of our regulars had started running a campaign and so all of his players came in and they bought that product and they got it out.

So finding those people in your stores, who are opinion-makers, finding those people who look to new product, using them to perhaps teach classes on how to GM this particular game or using them to run demos of the game becomes a way that you can begin to drive demand for what goes on. I’m going to get to our last question and I think in many ways you guys have answered it, but I want to sort of gather your thoughts together, and this is the dreaded question #6, which I hoped I would never get to on our list. Do you think that the industry’s current 3-tiered system is sustainable? And if it’s not, what’s the impetus to stop manufacturers from going direct? We’ve already talked about what stores bring to the industry. If manufacturers went direct, what do you see as – for both online retailers and brick and mortar retailers – what do you see the future of the industry to be?

Jon Huston: I think the 3 tier distribution system is critically important to keep brick and mortar retailers to be able to continue to get their product. From my perspective, a small retail store, if they had to buy all their product directly only from manufacturers to carry in their store, they would severely cut the number of different manufacturers’ products that they would be carrying. They simply wouldn’t be able to and the industry in the far past has had this experience in a similar manner in the comic book industry when Marvel, they got to be at a point where they were somewhere around 60 percent of all comic book sales, changed to a system where they would sell direct to all the comic book stores. And the comic book industry took many years to recover from the disaster that ensued and Marvel themselves, the drop in sales that occurred by trying to go direct to all the stores. After a few years they ended up giving up and that’s where Diamond Comic Distributors ended up becoming pretty much the only distributor of comic books out there. And I lived through that experience, because that was long before I had a mail order catalogue, I had a comic and game store. So I don’t think that that would be good for the industry at all and I think it’d especially be bad for smaller manufacturers and the smaller manufacturers are often those who bring in innovative new products. So in that regard, I could see a major presence like there is, in fact, one manufacturer who’s gone direct: Games Workshop. But as a result of going direct, has that really benefitted Games Workshop that much? From my perspective I don’t think so. I think it would have been better if they’d continued to distribute through the 3 tier system and not go direct. I think they’ve struggled for a number of years with their growth, that they couldn’t have experienced if they stayed in the 3 tier system.

David Wallace: I’ve already suggested that my fear is that manufacturers will lose faith in us, that they will think that we are no longer a viable alternative and I don’t think that’s the case. Why is that happening? We have to look at a basic assumption here. Has more money entered into this industry as a result of online retailers? Yes. There’s no question about it. There is more money in the industry. Unfortunately most of that money, as I said, is tied up in secondary product, out of print material, it’s not coming into our industry, it’s staying in the online retailers’ pockets. And the natural assumption is, that if they’re doing well, we must be doing badly. Otherwise where’d their money come from? And this overlooks the idea that they are helping us retain gamers and that’s where the money is coming from. Just because they are doing well, doesn’t mean that we are doing badly. But because, again, we get emotional about it and because there are always stores looking for a scapegoat because they don’t want to accept responsibility for themselves, we point the finger and say that they are stealing our customers away. It’s a misunderstanding. It’s a bad assumption.

Our industry is not hurting. We’re not in trouble. We picked up additional monies. That’s not a bad thing. The only way it really hurts us is that the online discounter has got so much money coming in from customers that we no longer deal with. As John told you, he’s carrying product that you don’t have in your store. Not because you can’t get it, because you can’t sell it to your small local market. He’s got the world to deal with, he can sell to a larger market. It’s still valuable material for him, it’s still generating money for him. You’re not in competition with him, it’s just generating money that wasn’t there before. Because he can make money doing that – this is obviously not addressed at John, I’m talking about the online retailer – it allows them to also sell new product at a lower price. They are subsidizing their ability to sell products that you do carry at a reduced price because of the money they are making on the secondary market, the out of print, the long tail. It’s not fair – that’s an emotional term – but the only real harm from it, is that it effectively devalues that product. “How can you possibly justify selling Settlers of Catan for X number of dollars when I can buy it online for 30 percent less than that?” So do we have competition? Absolutely. But it’s not that much, it’s only in limited areas, and it’s not going to drive you out of business. Most of their success did not come at our cost.

There’s nothing wrong with the 3 tier system. We should embrace it, we should run with it, we should do everything we can to make all parts of the industry as healthy as we possibly can. We need to remember that we’re the incubators; we generate the new customers. If we do away with the 3 tier system, we do away with our ability to generate new customers, although ironically, you finally hit upon a solution that will do away with most of the online discounters: if the manufacturers are selling it direct to the customers, why would they sell it to anybody else at a cheaper price? Unfortunately doing away with the online discounters that way is also committing suicide as a hobby. It’s not going to help our industry. So it’s not a solution to our problem. Manufacturers that don’t support us are going to do better in the short run, but in the long run, it’s a self-fulfilling prophecy. If you suffer attrition, retailers can’t sell your product, therefore they’re not going to push your product, you’re not going to pick up new customers, you’re dealing with a smaller clientele. It’s happened before. Columbia Games cut us out of the loop. How well are they doing right now? Hero Systems sent out an email saying we’re in trouble, stop buying from your store, come and buy from us. How well did that work for them?

“Talk to the retailers here at the show that are really working their stores. None of them are telling you that they are having problems, they’re going out of business. They’re all telling you that my business is going up. We’re not in trouble.”

– Dave Wallace

We are the sales force. We are a neccessary part of this. The wonderful thing about all of this is if you get past the emotion, if you just look at this from an objective viewpoint. We’re not doomed. This is not out of your control. Every last bit of this is strictly up to you. Go run a successful store, push the values that are available to you, and you will do just fine. Talk to the retailers here at the show that are really working their stores. None of them are telling you that they are having problems, they’re going out of business. They’re all telling you that my business is going up. We’re not in trouble. Don’t give into the fear, don’t give into the emotions. Deal with this as an intelligent businessperson and go back and take care of your own business. The danger here is that we tend to see this like an episode of “Survivor”: there’s only one winner. But you don’t get paid because your comptetition does badly; you get paid because you did it right. Nobody’s going to come to you at the end of the year and say “Everybody else went out of business, you’re the winner, here’s your million dollars.” Stop looking at it that way! Competition has nothing to do with it. Forget the stores in your city, forget the online, just run the best damn store you can. You’ll be fine. [Applause.]

Michael Stackpole: I’d like to thank both of our panelists and you for being very solemn and listening and having interest in what was a very important discussion. I think ultimately if you listen to everything that was said, it comes down to this: know your customer base, figure out what it is that they need, and then figure out how you’re going to deliver that to them. And that is, if you are a manufacturer, your customer base are the distributors and/or the retailers; figure out what they need delivered. If you’re a retailer, look at your customers, figure out what they need and deliver it. That’s the way we run. As Dave succinctly said “Run a successful business and you’ll be ok.” And that’s the way to do it. Thank you very much.

Fantasy Flight Media Center image copyright Fantasy Flight Games, used with permission. Titan’s Entertainment Cafe store picture copyright Titan’s Entertainment Cafe, used with permission.

GAMA Trade Show Crowdfunding: Kickstarter and Indiegogo

If there was a buzz word at the 2012 Gama Trade Show it was Kickstarter. Kickstarter this, Kickstarter that. It came up at almost every seminar I attended. At the wrap-up round table discussion on Friday at the GTS when an attendee questioned what Kickstarter was the room almost exploded with nerd incredulity. Fortunately someone was very brief in describing it and rival Indiegogo: instead of the artist or designer paying for a project, the fans are able to make contributions as a crowd, hence the term crowdfunding. In fancier terms, it’s a pledge aggregation site. As Anthony from the G.U.B.A.R. podcast said in G.U.B.A.R.’s 9th episode, “If you’re in the gaming community and you haven’t noticed Kickstarter, then you’re not paying attention.”

Image of Paul Hughes map of a dungeon from overhead with random encounters.

Dungeon Generator image copyright Paul Hughes.

Before the GAMA Trade Show though, I do have to admit to only having heard the name before and never had actually visited the Kickstarter website. The poster child for Kickstarter at the GTS was the reprint drive for Rich Burlew’s Order of the Stick which was brought up at least four times, as well as the fact that he raised $1.2 million with his campaign. In his Next Generation of RPGs, Jim Crocker introduced the idea of retailers using Kickstarter or Indiegogo to find new bleeding edge games for their customers, referencing the Kickstarter project for Random Dungeon Generator as a Dungeon Map, which raised $27,789, exceeding its $2,000 goal. Crowdfunding is a big deal. At Michael Stackpole’s Social Networking seminar, there was a rehash of what crowdfunding is and how it can benefit retailers. The idea of store owners talking to their players to find out their interests and ordering on their behalf was again brought up enthusiastically. Another possibility offered by crowdfunding is low-cost hardcopy advertisement in products, such as RPG rule books or expansions. Besides acknowledging individual contributors, a thanks or credits page could cite East Side Games for their assistance. Stackpole was also very modest in the brief crowdfunding discussion, not mentioning his own significant involvement in the launch of Wasteland 2 on Kickstarter ($2,933,252 raised with a goal of $900,000). Besides these various mentions of crowdfunding at the GAMA Trade Show, there was an entire unpublicized breakout session on the topic.

The Impromptu Crowdfunding Roundtable

One of the seminars I wandered into turned out to be quite different than what was posted on the sign; it was an impromptu Crowdfunding Roundtable with about two dozen GTS attendees. One of the factors in deciding between Kickstarter and Indiegogo that was being discussed was the need for a US bank for Kickstarter, whereas Indiegogo is more friendly for overseas crowdfunding. Another key difference is what happens with the funds if a project fails to fund. With Kickstarter, none of the contributors are charged, whereas the funds generated on Indiegogo are left to the developer’s discretion. Consequently an important part of developing on Indiegogo is deciding what you will do with the funds if you don’t meet your goal. They will also charge a higher percentage if your project doesn’t fund. Everyone who has conducted a Kickstarter campaign stressed that all of the prep work should be done first for the project and that developers should set realistic goals.

Retailer Scott Thorne shared his experience in using crowdfunding “years before Kickstarter or other forms of online crowdfunding became available.” The problem at his game store, Castle Perilous, was seating. Thorne solicited his customers for donations of $20 to help get new chairs for the store. He offered an inducement of putting each participant’s name on the back of an individual chair. The vanity reward paid off with 20 customers participating and securing the new seating for the store.

Others spoke on crowdsourcing. Vicky Beaver was asked to share her experience with Caladon Falls’s successful funding on Indiegogo and generally agreed with many of the other principles expressed about successful project management described here. Someone shared that less than 1% of project backers fail to make payment when it comes time to fund a successful Kickstarter project, which meshed with a project that was brought up which had secured $12,000 in funding, though one contribution of $5 didn’t come through.

Cover for Hellas the role playing game showing futuristic Greek spacefarer

The Hellas RPG Reprint has had 16 Updates

Jon Huston from Troll and Toad contributed that for him the updates are really important. Every Kickstarter that Huston has signed up for has fully funded, he said, including Wasteland 2. As a project moves along its developers can post updates to let fans know how far along from the goal they are, to encourage further advertising, and to keep fans abreast of any changes. The update posts to the Kickstarter project page, but also generates an email to backers. So far on the Hellas RPG reprint Kickstarter there have been 16 updates, with 11 of those before the project met its goal and 5 since then.

The Retail-Friendly Kickstarter Email List

David Wheeler of Dragon’s Lair Comics & Fantasy with stores in Austin, San Antonio, and a franchised store in Bellevue, WA attended the impromptu discussion. He has put together an email list of Kickstarter-friendly retailers, so if you are either developing a game project or are a retailer interested in this list, you can join it by emailing info at dlair.net. As of May 1, there were 47 interested retailers on the list.

Crowdfunding: Not for Everyone

Larry Roznai pointed out one perceived flaw with crowdfunding at the Domestic Manufacturing GTS seminar. Roznai argued that by offering games as rewards on Kickstarter, the manufacturer is bypassing retailers and in his experience, retailers are where manufacturers should be focusing their efforts. He’s not alone in urging caution when it comes to Kickstarter and Indiegogo. One attendee at the impromptu roundtable pointed out that it is deceptively easy to fail on Kickstarter. Failed Kickstarters aren’t advertised or promoted by Kickstarter and a project developer is unlikely to point out past failures. Since no money gets charged from contributors to failed projects, there are seldom any hard feelings, so a contributor is less likely to recall failed projects as well. However, in the exhibit hall later, a manufacturer mentioned that a friend intentionally launched a project, knowing it would fail, as a means of advertising a new product from his company. This is not what Kickstarter is all about and could have hurt the company’s reputation.

Kickstarter Veteran: Impact Miniatures

Tom Anders from Impact Miniatures has successfully funded 4 projects using Kickstarter, with the largest being a $5000 fund for a miniature ape football team. Anders had been approached about making a football team of great apes by a customer, but doubted that it would sell. Rather than dismiss the ape fan outright, Anders offered to put it on Kickstarter. The fan of football playing-primates rallied his friends and kicked in $2,000 of the project himself. The finished figures should be coming out in June. His minor inducements to contribute included a variety of figures, but Anders had two top tier stretch rewards. As Anders explains “stretch rewards are incentives that you offer the people after you’ve hit your goal.” In the case of the Ape Team, these included a customer getting an ape tattoo as one reward, with the other being a sixth sculpt for the primate team. The Apes of Wrath was selected by Kickstarter as a featured project, but only for a day. Anders did see a small spike in contributions while featured in the Top 3, but pointed out that he watches another game designer’s campaigns. When she would advertise being at a convention in her updates, there were much larger spikes in her funding on those convention days than what she got when her project was also featured in the Top 3. Anders agreed that “personal contact drives” Kickstarter.

As for the importance of updates, Anders says they are, “Vital. I have found that the Kickstarters that communicate on at least a bi-weekly basis seem to do much much better than the ones that just throw it out and don’t really let anyone know what’s going on. One of the things that Order of the Stick did so well was that every 2 days he sent out an update to thank everyone, to let them know what he was working on, to let them know what the next stretch reward would be.”

Impact Miniatures will be releasing their next project, Impact City Roller Derby, on Kickstarter with a projected date of May 15. When we talked at the GAMA Trade Show in March, Anders and his team had already come up with 5 different stretch rewards for the roller derby game. He also has already planned ahead to his promotion schedule for the future Kickstarter campaign, planning at least two convention events to help him sell it to potential backers. As for his track record with receiving the pledged funds, in Anders’s experience with the 4 projects, he has received 100% of the pledged funds which are charged through Amazon.com.

Further Kickstarter Advice: Collins Epic Wargames

Bunker Tile for Spearpoint 1943 from Collins Epic Wargames showing a bunker complex

A Kickstarted Tile Found in the Spearpoint ’43 Map Expansion

While at the GAMA Trade Show, besides interviewing Byron Collins about Collins Epic Wargaming’s upcoming 6mm sci-fi rules set Polyversal, I also asked him about Kickstarter and his experience with it. He pointed out that “it’s a great tool, but that’s what it is, a tool. It’s not the end all solution for you as a designer.” C.E.W. first used Kickstarter to fund the Spearpoint 1943 Map Expansion and he plans on crowdfunding again. The Spearpoint ’43 Map Expansion was a 60 day campaign and was a success, receiving over $10,000 for its goal of $7,500, or 135% funding. A key aspect of a successful Kickstarter plan according to Collins is taking the time to come up with excellent rewards for your backers. One prestige level of reward Collins offered was the chance to appear as a character in the game’s stories authored by Mark Walker that will accompany the map expansion. Another tier of rewards was unlocked when the Spearpoint expansion reached $10,000, allowing Collins to include more bonus map tiles, as a stretch reward. Despite the success, Collins has noted areas where he could improve in future campaigns and is willing to share his experience with others designers. As for general advice to game developers on doing their first Kickstarter, Collins suggests:

“If you’re about to launch a Kickstarter campaign and nobody knows who you are, you’re on the wrong path. You need to already be out there, on BoardGameGeek maybe, or at a show doing a demo, not necessarily doing a booth, but go play at open gaming at a convention, get a lot of good feedback on that game, test it really well, make sure it’s done, because a lot of games up there, it’s obvious that they’re not fully developed, they’re not fully hashed out.”

Besides Kickstarters going well, Collins pointed out that they can also fail miserably. It is this binary finite nature of Kickstarter, success or failure, that Collins also seems to enjoy. Either fans want it or they do not. He did have this advice to offer though:

One of the things that I see happening is people who have never dealt with game production before, get into Kickstarter, they raise a ton of money, and all of a sudden, you’re on the hook. You’re on the hook with people’s money and that’s a big deal. If you’re not a business, and you launch a Kickstarter, you’ve got some tax implications. Really, either way. You’ve got to think about a lot of those things. You got to think about how you’re going to use that funding. Do you already have production sources? Do you have a good idea of what your goal really should be? Are you spending money on advertising? What’s going to come out of that funded Kickstarter? Is it going to be depleted immediately by ad money that you’ve spent on BoardGameGeek. I mean, that may be well spent to help it work, but if you’ve spent all your production money from Kickstarter, you’re going to be in debt, really, because you’re on the hook. So when you get on the hook like that, make sure you know what you’re doing. If you don’t know what you’re doing, you don’t have any sources, there’s people in the industry, including myself, that are willing to help because we don’t want to see people making mistakes that take a great idea and end up not making it happen, because I’m a gamer myself. I like to see new great games, I’ve backed a bunch on Kickstarter myself and the good games out there, you can tell the ones that are done well, and you can tell the ones that aren’t quite ready for Kickstarter, so there’s a lot of prep, and there’s a lot of engagement you have to maintain with people who are watching your project.

First Kickstarter from GTS Attendee: Disaster Looms

Text "Disaster Looms!" over a space and planetary background for board gameI attended several panels and ate with Eric Salyers at the GAMA Trade Show. Also new to the GTS and game manufacturing, he brought his space exploration game Disaster Looms! with him. The game is a boardless board game, using hexagonal playing tiles instead, which I thumbed through at the show. His company Break From Reality games has just launched its Disaster Looms! Kickstarter campaign with a goal of raising $25,000. His team at Break From Reality Games is getting the word out via Facebook ads and updates, BoardGameGeek ads and updates, in-store demos, and Kickstarter itself.

Disaster Looms! is offering at least two tiers of retailer-only awards, because, in Salyers’s words, “game stores are the back-bone of our industry” as well as being “the nexus of our community.” Several of Disaster Looms! rewards include in-store game promotion from the Break From Reality team. As he sees it, “I am in this for the long-haul, and plan to release other game titles, and expansions – I need to have an alliance with the game store owner as early as possible.”

Salyers is no stranger to Kickstarter having funded 18 projects so far. He points to The Present as both the first Kickstarter he helped fund and as an inspiration for him as a creator. Salyers actually created Disaster Looms! the night he watched The Present. He also has funded several TMG titles due to his love of “great game play and creatives themes.”

As for stretch rewards, Salyers and his team at Break From Reality have given it a lot of thought:

Our team had rewards chosen all the way to $125,000 funding level. We have released the $32,500 level, and the $40,000 level. We have hinted that there is a $55k+ level as well. We are sitting at 23% funded after 3 days … and we know of a couple thousand in commitments to come. So we are feeling happy, though still stressed about whether we will make our goal. And in particular – we really want to hit the $40,000 level of funding so we can release the game as a 2-6 player game. We really wanted to do this from the outset, but it too high of a goal to start off with for an unknown company with an unknown IP [Intellectual Property]. Stretch goals to us are all about rewarding backers, and creating rewards that will be really appreciated by our backers. We spent literally weeks on the design, testing, and validation of what we wanted as stretch goals. It would not be good enough to throw in branded items that would be of no value or real relation to the game play experience. We think the first player token will enhance the play value of the game, and make the bidding process for the token a little more worthwhile each turn. A heavy sculpted coin is fun to fiddle with. Everyone knows it. The 5-6 player expansion, a true expansion mind you, will add not just 2 more players – but more game content. It will add additional replay-ability to the 2-4 player game as well!

The Disaster Looms! Kickstarter will end its run on June 18. According to Salyers, the Kickstarter process is “a very straight forward system” and he’s had no problems or confusion along the way. Like Byron Collins, Salyers also enjoys the finality of the Kickstarter approach: “you have created something, and now you are sending it out to the world to be accepted or denied.”

This “do or die” feature of crowdfunding is also one of its great strengths and one of the reasons the game industry has begun shifting. Instead of conducting market research or trusting a gut instinct or experience when it comes to whether a game will sell or not, even established companies can vet new products and projects on Kickstarter or Indiegogo and actually know whether they might have a winner on their hands. While there are a few complications and problems to this approach of game marketing, overall the effect on the industry should be a great one.

Disaster Looms! box art is copyright Break From Reality, Hellas cover is copyright Khepera Publishing, and the Spearpoint 1943 Bunker Tile is copyright Collins Epic Wargaming, all used with permission.

GTS: Effective Marketing and Social Networking

I will be wrapping up my GAMA Trade Show coverage very shortly, having milked my attendance of nearly everything I experienced at the GTS. Here are two other seminars I attended with some advice that potential game designers or game store owners could make use of.

Creating Effective Marketing Programs

Mike Webb, VP of Marketing and Customer Service for Alliance Game Distributors, the largest game distributor in North America, gave an introduction to marketing for manufactuers in his seminar called Creating Effective Marketing Programs.

Two key points that Webb made are that good marketing is deliberate and that good marketing is ongoing. Retailers have complained to him that many manufacturers’ products go unsupported in their stores. There may be product support during the solicitation phase, but once the product is on shelves, the manufacturer ceases support. This is unfortunate because Webb described most retailers as having “absolute passion for the games”, passion that manufactuers should be tapping into.

Webb suggests manufactuers set aside some units of their games purposefully for promotional use, as demo and review copies. He also believes that there will be a shift in the paradigm of game marketing as happened with Dominion and deck-building games. He anticipates that in the next 5 years, there will be 2 or 3 new concepts or big ideas in gaming, but that only one will probably last.

Two resources he suggested were Paco Underhill’s “Why We Buy” and gmarketing.com for their guerilla tip of the day.

Michael Stackpole on Social Networking

Author Michael Stackpole smiling at the GAMA Trade Show.

Gaming Guru Mike Stackpole

Michael Stackpole addressed his seminar towards the needs of retailers, but game manufacturers and others (myself included) can apply his advice. The author of a large number of Star Wars and Battletech novels, Stackpole was also a developer of the hugely influential Wasteland video game, among many other games he developed. As he mentioned at the Online Retailing debate he also used to manage a Flying Buffalo game store in Arizona when the company still ran one, so he has experience in retailing.

Stackpole suggests breaking the customer base into constituencies, such as Yu-Gi-Oh players, hex grid wargamers, and role players. Efforts should be based on these constituencies and specifically target them, so a Magic player isn’t neccessarily receiving a Warmachines store update.

Customers’ Unmet Needs

Stackpole identified three unmet needs in most stores:

  1. Information: store owners usually possess a good deal of insider information that they can dole out in their tweets, Facebook updates, or emails.
  2. Validation: gamers want to know that they’ve been noticed, says Stackpole, take a picture of the top 3 winners of your tournament. They feel validated and their opponent who couldn’t make the event has even more reason to show up next time to displace them.
  3. Scheduled interactions: Retailers can use social networking to schedule interactions with their players. Stackpole gave the example of a store tweeting “UPS just arrived with 24 copies of the new game, 12 are spoken for, the other dozen are available to whoever gets here first.”

Social Networking Tools

Having identified those needs, Stackpole briefly covered a number of tools to help store owners take advantage of the internet:

  1. Store owners should own their own website and have their own domain name. There was a very archaic discussion about .coms from the attendees at this point, which I did find slightly amusing.
  2. Stackpole next suggested getting a Twitter account, calling it a “painless way to service your constituencies”.
    1. Part of Tweeting is deciding what your store’s presentation is going to be online. Stackpole used Steve Jackson Games twitter feed as an example, as each one of their tweets is initialled by the employee. Only allow access to those people you trust, Stackpole warned, because you don’t want anything done in bad taste reflecting on your company.
    2. Another point about the overall branding on the internet Stackpole made is that your online persona is not neccessarily you, that store owners might take on the role of facilitator, of being the butler or valet, offering friendly advice and service. For example, a store called Giant’s Games might have Gromphus the Giant inviting puny customers to try the newest offerings from Fantasy Flight this coming Saturday. While this is my shoddy example, Stackpole advised that once your online persona’s character has been constructed, to always stay in character with your tweets or posts. Customers will begin to expect whatever identity you’ve created.
  3. A Facebook page. Stores should consider creating a Facebook page to keep track of their customer constituencies and make it easier for their customers to get the validation they want and to supply them with information. Store owners in turn can “friendmine” those who like them on Facebook for any other customers they recognize, but store owners should do so cautiously, with no more than a dozen a day.

Email Services: Mail Chimp and Constant Contact

The combination of a store website, a Twitter account, and a Facebook page seemed to be the basics. With some contributions from other attendees, Stackpole also pointed out some other websites or technologies that retailers could use including Mail Chimp for creating and managing email lists with the first 2000 email addresses free. Constant Contact is a competing paid service that also came up. In my experience, I receive weekly or semi-weekly emails from Las Vegas’s dedicated game store Little Shop of Magic, one from Battlezone Comics, and another from Comic Oasis. Depending on their subject lines and what I initially see, I may or may not actually read them, but it does remind me of new products and the stores’ continued existences. Comic Oasis uses Constant Contact with store management typically spending 25-30 minutes each week preparing their weekly mailing. For store owner Derrick Taylor, Constant Contact is another tool to reach customers. Some of his customers “totally rely on it” for their comic and gaming information. He cited Constant Contact’s Facebook and Point of Sales integration, as well as its “pretty reasonable” price, as reasons that Comic Oasis uses the software.

Google Places and Four Square

Kickstarter was mentioned again as a possible means for store owners to interact with their customer base, but I will be going into greater detail about the Kickstarter craze at the GAMA Trade Show in a separate, more detailed post. Google Places was another service mentioned. Basically when someone does a Google search for “game store”, a store owner should like to see a red teardrop come up next to the store name. This is a Google Place and is a means of attracting new customers and advertising a store’s existence. Store owners can get placed on Google Places easily and automatically by putting their business on Yelp or Citysearch. Another website retailers should look into is Four Square. People check in using their mobile phones at a game store, possibly for a tournament, and all of their friends can see what they are doing (and might be more likely to come themselves). Store owners can put coupons on Four Square and reward their customers for broadcasting their presence. I am more familiar with this as a guerilla means of advertising eating at a restaurant, but the concept should be easily applied to a game store.

More Specific Tools

A QR code for a smart phone with the Craven Games logo inside it.More and more attendees shared more specific tools at the end of the Social Networking seminar. QR Codes, which had an entire seminar the day or two before the Social Networking seminar, were brought up. Store owners can place the QR code, which is a more advanced barcode scanned by smart phones, on a handout advertising an upcoming tournament, sending customers with QR-enabled devices directly to the tournament’s page. Wired.com’s QR code generator, found at QRHacker.com, lets a company place their logo in the code, as I have done to the right. Tweepi for Twitter was suggested as a way of managing Twitter followers and gremln (previously twaitter) allows for the scheduling of tweets ahead of time. Stackpole advised those using WordPress to post something regularly. His stormwolf.com is an example of a WordPress site. This site, cravengames.com, is another. WordPress users can schedule posts for times when they will be away on vacation or out of the office. The plugins akismet for comment anti-spamming and WPTouch to format WordPress blogs for mobile devices were also suggested. A final suggestion that I implemented soon after the GTS was using hostgator.com for website hosting. I had noticed that cravengames.com seemed to hang on loading from GoDaddy, my previous webhost. Now on hostgator it loads much quicker, as I would expect it to. I also created a Twitter account, not surprisingly #CravenGames, but I have yet to really utilize it. The 140 character limit is kind of antithetical to Craven Games and in-depth information.

A Few Further Points on Social Networking

“You’ll have a friend in a fit of pique who will unfriend you and this is supposed to crush you.”

There was also a light discussion on the realities of social networking. One attendee pointed out that store owners should ask for permission before posting pictures on their websites or Facebook pages (or even tagging players at tournaments) because they might be “closet gamers”. I had never thought of myself as in the closet before, but I did appreciate what he was suggesting. I have my own unflattering unsolicited pictures on several websites. Another thing that Mike Stackpole mentioned that really stood out to me and amused me was when he said of social networking, “You’ll have a friend in a fit of pique who will unfriend you and this is supposed to crush you.” All in all, the seminar was a very informative overview of the basics of social networking. Perhaps there will be a 201 seminar at next year’s GAMA Trade Show.

WotC Magic: the Gathering – Make the Best of Your Magic Events

“Magic has never been such a strong brand.”

Helene Bergeot from Wizards of the Coast addressed retailers at the 2012 GAMA Trade Show. Her background is in trademarketing and she is Director of Organized Play for Magic: The Gathering and her talk was titled “Moving from Good to Great”. According to Bergeot there were more than 130,000 players for the pre-release for Dark Ascension and “Magic has never been such a strong brand”. The reason, according to Wizards of the Coast, is that Activity drives Activity. WotC has found that the best stores are the ones running the most events. “The size of the event doesn’t matter,” instead, according to Bergeot, the frequency and number of events is what counts. In stores where Magic is highly successful, on average no more than 24-36 players are playing in tournaments or release events.

The response from most retailers was glowing. One retailer crowed that his February sales were big, like his “second-best Christmas”.

Wizards of the Coast to Retailers: “We are here to support you.”

Getting new players to events and engaged in them, Bergeot emphasized, is necessary in order “to grow the community.” Wizards has found that players new to OP balk at participating in their first organized play event. Even their second exposure to OP is no guarantee that they will continue, but after their second time doing organized play, Wizards has seen its “level of retention” among players remain very steady. Twice a year, WotC conducts surveys and spends hours and hours going over them to improve customers’ experiences and their retailers’ sales. Helene affirmed to the attending retailers “We are here to support you.”

A Canadian retailier pointed out that “a lot of gamers have no life” and takes advantage of that by giving them one in his store. He does sealed $25 events and “it just packs the house,” getting 82 players with his last sealed event. For Valentine’s Day he had a special event with girls playing free and wound up getting 22 female players, 15 of them in the store for their first time. Trevor McGregor from the Gaming Pit shared his store’s Full Moon events on the full moon of each month. The special event provides a bonus for including a Werewolf card in the decks, which could be an extra booster pack of cards or whatever the door prize is for that particular night.

I was intrigued when I learned that one of the background images during Bergeot’s presentation was a chandelier made out of Magic: the Gathering cards. Most, if not all, of her background images were taken at Card Kingdom in Seattle. This Magic chandelier was designed by Stacy Lewars from Studio Metro Design. Card Kingdom seems to have a very cozy environment to play in.

Magic: the Gathering lands are strung together to form a chandelier of cards

Magic Chandelier in Card Kingdom in Seattle, image courtesy Card Kingdom.

Magic Supply Easily Tapped and Problem Players

The seminar flowed into supply issues that retailers expressed with obtaining enough Magic cards to meet their customers’ demands. The Canadian retailers present either were particularly vocal or have increased difficulties in obtaining enough product. Wizards will be eventually placing a cap on the total that a retailer can order, but it will be a year before they implement this cap, which prompted some retailer complaints about the cap’s existence at all. A very popular product seems to be the Magic “fat packs” which Wizards only intends to be on shelves for a maximum of 30 days; instead some retailers pointed out that they go through them in “2 days!”

The next sub-topic was another problem faced by retailers, over-enfranchised players who scare off new players and create bad play environments in stores. One attendee pointed out Wizkids’s Fellowship award as a positive step WotC could take to curb problem players. Trevor McGregor again spoke up, saying that store owners or managers “have to be honest and upfront with” the players creating the bad environment. Another attendee uses a token system in his or her store to correct player behavior, which sounded more like elementary school behavior management, but it works according to that retailer. More and more retailers chimed in. A Canadian store owner has called the police on one of his Magic players before which sent a strong message to the rest of his players about how seriously he takes player conduct. This elicited laughs from the room. Another retailer explained that when he confronted a bad sport in his shop, the player said “This is all I’m good at” as to why he enjoyed crushing his opponents so much.

The seminar returned to Helene Bergeot’s presentation where she reviewed FNM, Friday Night Magic, and there were suggestions for events store owners could hold, such as deck building workshops or conduct trading forums. Wizards will be having an improved store locator on their website available in the next few months allowing players to do advanced searches for specific event formats. Wizards will be looking into rotating stores for the Pro Tour Qualifiers. As the seminar wrapped up, a retailer complained that he doesn’t have enough DCI cards for new players with several others agreeing. There is particularly a difficulty in the turnaround on cards for players younger than 13.