Can GW Lower Prices?

[jorz192]

I saw the report that GW's sales were down by 12% and know that I personally stopped buying models and
books after the release of the Chaos Space Marine Codex. The codices simply became to expensive to
justify buying them.

I am curious as to whether a business like GW can actually lower the price of already released products without
really hurting their retailers and creating a marketing disaster.

[AdamHarry]

I am curious as to whether a business like GW can actually lower the price of already released products without
really hurting their retailers and creating a marketing disaster.

Let me ask you this: Why would them lowering prices hurt their retailers or create a marketing disaster?

[jorz192]

If you lower the price of already released products then there will be a set of the same products on the market that were obtained from the manufacturer at a higher price.
The retailer is forced to sell the products they already have at a higher price than the ones now available from the manufacturer. They would have to take a loss in order to match the price of identical products available directly from the manufacturer or from new retailers entering the market.

[ElectricPaladin]

If you lower the price of already released products then there will be a set of the same products on the market that were obtained from the manufacturer at a higher price.
The retailer is forced to sell the products they already have at a higher price than the ones now available from the manufacturer. They would have to take a loss in order to match the price of identical products available directly from the manufacturer or from new retailers entering the market.

Is there any precedent for offering your retail partners a rebate, discount on future purchases, or some other way of softening the blow? I can't imagine that every manufacturer for all time has been locked into "this price or higher" for all time. "Sorry, we decided that our prices got out of hand, but here's a $X credit on future purchases to make up for it."

I see the quandary GW is in... but there has got to be a way out.

[DarkLink]

The better question is, is GW willing to accept that they'll need to actually work with retailers instead of against them like they normally do.

[GrauGeist]

GW could reduce (some) prices slightly, and raise other prices to "rebalance" things.

But a significant, wholesale reduction? Nope.

Besides, last year, GW's gross margin improved, so there's not that much need to convert back to a higher volume & lower unit profit model.

[Baneblade]

Most likely way to lower price will be through inflation. If GW kept the nominal price level (the current price tag you see) at the current level, over time the effects of inflation will reduce the real price. We saw it last year when the time when price changes happens and that most if not all items remained the same price. However that stable price did not translate into the newer releases, with the Dark Elf Witch Elves being the most obvious offender. Maybe GW saw the effects of that poor price structure for the kit and adjusted with the upcoming Hammers/Longbeard kit.

[DarkLink]

Besides, last year, GW's gross margin improved, so there's not that much need to convert back to a higher volume & lower unit profit model.

Last year, yeah, but this last quarter saw a massive drop in sales and profits. Sacrificing customers in favor of jacking up prices might not carry them any further.

[Fanboy]

Could GW lower prices? Yes they probably could, but like any organization its about profits and keeping the shareholders happy. Its not about the customers....... Synical....maybe.......but thats the way I see things sometimes.

I understand the need for profits to pay salaries, develolemnt costs, cost of sales and logistics and marketing, etc, etc. So, i may be able to accept the 'high' cost of miniatures, but then at least have a decent/solid ruleset, and proper games/rules testing. 6th Ed, along with higher prices is single handedly killing GW. How can I say this, well have a look at the wonderful results GW posted in the previous 6th month period. They can spin us whatever story they want, the reality is a poor BRB, namely 6th ED, and far too many codex and rule supplement releases over a short period of time. I know we have always complained that GW was slow to release new material (E.g. 15 years or so for a new dark eldar codex), but at least the rules worked. The sudden flood of over powered codices to drive sales, additional rules supplements and high prices have finally pushed the 40k player over the edge, and the market is pushing back by not purchasing, and potentially leaving the hobby for other table top/gaming hobbies. But GW continues to blame their retailers and stores. I cannot believe a company that has been around since approx 1986/7, with a strong track record can employ such stupid marketing people, and make such bad decisions.

The basis of this hobby is a solid rule set, not the 6th Ed drivel we currently have, and all the over powered, untested codices, and additional supplementary rules. Have a solid basic ruleset, with occassional rules updates/options (e.g. options for flyers, options for allies, options for MFC) and balanced codex releases, and the models will sell themselves.

There is ever increasing competition out there, with gamers having more choice than even before for toy soldier wargaming. GW is no longer the only company out there, and maybe its time they realized this. Switching costs from one system to another is not that difficult, and hey, i could even use my GW minis in the other systems. And then there is the ever increasing market of PC/console/online gaming, another competitor for GW to consider.

So, increased prices for minis I can accept to a degree, but GW needs to get their act together with a solid ruleset, and balanced codices. They got it right in the past with 4th and 5th Ed that did have some shortfalls, and needed a tweak here and there, but 6th Ed is just terrible and the current sales/profits are showing this. Maybe its time to bring back some of the old team, and get things back on track......

[ElectricPaladin]

Could GW lower prices? Yes they probably could, but like any organization its about profits and keeping the shareholders happy. Its not about the customers....... Synical....maybe.......but thats the way I see things sometime.

I think it's remarkable that you are simultaneously critical of GW and falling into the same flawed logic that is killing the company. GW is about the customers, because we are their meat and drink. Or, rather, our money is. When GW forgets that, they court abandonment. They are not the only game in town - now more than ever - and if they forget that, they will die.

GW needs to remember that our patronage is how they survive. If they want to exist in the long term, they need to create a solid product that their customers will continue to enjoy, and consume, in the long term.