GW Payperclick

[ColCorbane]

I found this whilst doing some searches for my campaigns blog. When I search google for "warhammer 40k campaigns", GW comes up as a sponsor on the right hand side.

Now, they're pay per click sponsored, and if you don't understand what that means, basically a company tells google how much they are willing to pay per visitor that google sends via the advert for specific keywords.

So, basically GW is paying for people to come visit their site which seems a bit strange as you'd think anyone searching for 40k stuff would already know the GW site. I also noticed that they seem to be paying more than wayland games.

The only thing I can think of is that they're hoping to pick up traffic from those people who are looking to buy 40k stuff as an xmas present and they're not aware of the GW main site and just searching for little johny's xmas wishlist.

[deadmanwade]

It could also be an attempt to further reduce the number of middlemen selling through the internet. Usually most people searching for something only look at the first few results. If GW is number 1 on that list then they're pushing one of the smaller firms off the list and into Google-oblivion.

[Selorian]

From our point of view, Games Workshop has made a move against Independent retailers.

In our opinion, this started a couple of months ago when Independent Retailers were asked to remove all images of products and product descriptions from their website. This is a very unusual situation and many distributors/manufacturer supply retailers with product images, descriptions and videos as they want to help generate sales and professionally represent their products .

By independent websites not being able to provide images of their products (unless you use a photograph of the box), customers without prior knowledge of what the item is, do not know what the item/items look like. This also results in independent retailer websites looking unprofessional and untrustworthy.

Shortly after being told to take down our images and descriptions, Games Workshop began to advertise on Google as ‘Genuine Games Workshop’. Genuine suggests that they are to be trusted and that other sources are not.

[Commissar Lewis]

Well, looks like GW is trying to push out the reasonable priced alternatives to further ***-ream everyone on prices.

Though why IR's are cheaper than buying direct baffles me. I dunno, it's 3 am and I'm tired.

[Selorian]

I can only speak for European Online Retailers however, it is becoming much harder to offer significant discounts on GW products.

Prior to the new Terms & Conditions, discounts to independent retailers included VAT and offered a discount ranging from 35-40% off. Since the new Matrix system (or a name like that), discounts now exclude VAT.

I.e.£100 RRP - 35% Discount - £65 + VAT @ 15% = £74.75 cost. (Previously this would have cost £65.00 including VAT)

The majority of online retailers were offering 20% off which would mean that for an order with a RRP value of £100.00, retailers would now make £5.25 which equates to around 7% profit. It’s worth noting that credit card transactions often have a processing fee (can exceed 4%) and that online shops can get a maximum discount of 35% off.

This is obviously pushing up prices and in return lowering the price difference between GW and online retailers.

[oni]

GW has a very strict policy about independent retailers selling GW product ONLINE. You're not allowed to do it with the typical cart system nor are you allowed to use GW's IP on your website. They want the ONLINE sales to go to them directly. The only people this will have any significant impact on are those retailer who choose to ignore GW's policy and drive most of their sales online.

As for the advertising on Google... With the Dawn of War series being a massive success, I can only conclude that it is to drive those individuals who are only aware of the video games to GW's site in hopes to indoctrinate them into the tabletop realm.

[mathhammer]

the thing is this is NOT about GW trying to make money on the sale, it is about trying to keep brick and morter stores open.

GW's web prices are 100% MSRP and they sell the the stores at around 50% MSRP (if i remember correctly) so the local stores can all undercut GW.

But if the internet retailers undercut your local stores it's bad for the hobby.

(Yes I know GW makes money on it, but this is a hobby growing thing)

[pgmason]

@Oni - That's simply not true, at least in the UK and Europe. You can sell GW online with a shopping cart.

However the way their trade discount works is based on a 'points system'. It starts at 25% and you get points for various things such as having gaming tables, running events, having a shop front, giving painting lessons etc. If you get enough points you can get up to 45% trade discount. This is designed to help B&M stores compete effectively with online retailers - but it does mean that if you're an online only store you'll have a hard time maintaining the artificially low prices that people are accustomed to. Personally I think its a good thing. I used to run a FLGS and one of the reasons it closed was online discounters selling grey import boxes of Magic for less than we could buy them from distributors, due to the sheer volume they were shifting meaning they got a better discount.

@Selorian - are you sure about the discounts excluding VAT? It sounds more like you've lost discount because of the points system. They can't take the VAT out of the equation - its not up to them after all - it's up to the Government. The only other possibility is if your VAT status has changed because of crossing the VAT turnover threshold (Currently £61k).

[Duke]

There are a few things that the OP didn't cover.

Yes, generally anyone who searches for 40k knows about GW. However, a lot of people who play 40k may not know much about fantasy, LOTR, specialty games. When you go to the GW home page you notice that they plug all of their different systems.

Using one product to drive sales of another product is cross selling. Perhaps this form of advertising doesn't make sense on the surface, but Im sure if you could track cross sales then it would make a lot more sense.

Duke

[Selorian]

pgmason - I'm very sure about the alteration to trade discounts.

Our current discount is 35% which is supposed to be the maximum that a online retailer can get. The 35% discount excludes VAT.

After the change, we initially had a 30% discount however after complying to their Matrix system, (or a name like that) we managed to get our 35% back.

GW are different from the majority of distributors in that they sell their own products to the public. When you take into concideration all of the recent changes I think it is very obvious that they are making a move against online retailers.

Bricks and mortar shops are slightly different as long as they do not compete with a GW store and comply to their Matrix system which essentially provides GW with free shops (gaming tables using their systems, painting lessons using their products, advertising in windows, staff going to GW training courses, GW shelving etc).