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So, this comes up every once in a while and I have not seen the whole scoop. Why is Games Workshop not tanking? What needs to happen for them to actually fail? And where does one find the numbers that would support an argument either way?

I have noticed that there exists a group of people who love the idea of making 40k armies. That group then buys an army and paints a couple of models. They then quickly move to a new army do the same thing. Some of these people sell before moving on, others horde.

I personally think its these people who spend a load of cash on GW more so than anyone else. One of my friends is like this. Constantly buys whole armies then sells them really cheap. Loves coming up with army ideas but doesn't look like he actually enjoys playing the game.

Of course there are people who do this and love the game, but in my experience there aren't heaps of those.

The amount of money people from this group spends is huge. Add the cost of a 1800 point army, then (in the case of a friend) multiply that by 10+ armies and it adds up.

Almost like an addiction really.

But other than financial reports there isn't really hard info on GW and their downfall. As much as I think they won't last people have been saying it's coming since before my time.

 Powerfisting wrote:
So, this comes up every once in a while and I have not seen the whole scoop. Why is Games Workshop not tanking? What needs to happen for them to actually fail? And where does one find the numbers that would support an argument either way?

They're still the biggest player in the market, they have massive inertia (never underestimate this), and they have a fundamentally great IP.

They've been slipping for years, and have some concerning long term prospects. It's probably why we're seeing so much radical change from them over the last year.

However, they're still the 400lb gorilla in a room full of chimps, they're just not the 800lb gorilla in a room full of tiny monkeys anymore. That's what's likely to remain the case for the foreeeable future. An imminent collapse is not on the horizon, they're not in danger of folding tomorrow. They're in danger of that happening in 4/5/6 years if their revenue trend does not change.

Well lets look at this way, regardless what GW does, the one core point in any business is to make money, GW has product, but recently selling that product is in decline.

GW posted an 11 million + pounds decline in sales in the 2013/14 financial year and it looks likely to be even worse. From 800 pence their stock has halved and even in their latest mid year report they post a million pound operational loss.

GW had to streamline, getting rid of the Specialist Games was a start, then we got Nagash which sees upheaval within the Fantasy section, with the new bubbles of reality rumoured and half of all Fantasy kit being squatted due to streamlining.

This direction cuts GW costs exponentially, not only that but GW is restructuring to Shop Front stores and getting rid of Battle Bunkers and Hobby Shops will afford GW to further cut costs.

Then GW announce a raft of price rises that goes contradictive to their situation, further alienating their customers.

GW is not in the business in selling product, more likely to get investors and prop up the company.

However GW is losing customers faster than they can replace them. GW has less than 10 years left.

Its called plastic crack for a reason. There are some poeple who just can't help themselves and have to own five of everything. Worse are the people willing to spend double the dollars for a few trinkets on the limited edition codex, codexs that are already 50% higher in price than they should be.

These people I just don't get when you actually look at the rather poor quality of tbe product in the first place.

They aren't exactly tanking, 15 yrs ago they were the only major player in a very small market, and D&D was the only other mainstream miniature game available. Now the market has grown, the number of other companies and other miniatures has grown, and the internet has made it easier to find players of smaller games. It is only natural that the market leader will shrink as other companies grow. Either that trend will continue and eventually they will have to shrink to stay competitive (but that won't happen for a while as the gap in profit between them and the forerunner is still huge), or they will show more public acknowledgment of the trend and act to hold their place. They are trying to do that now (one man stores, end times etc) but many would say it isn't working.

However, for a large number of gamers, 40k is the only reliable game that others around them are playing to be able to regularly play a game.

Why does everyone look at the bad points of GW?

First the stores. 90% of stores I visit have great and helpful staff. Yes they have a job to sell you more stuff you probs don't want. Isnt that what every store you go to does? be it for a new tv or video game?

They are always focused on the next gen of players. They dont let the lil kids come into the store and get stomped by waac and tfg. They will help guide and shape the mind of new players and when the parents see that its a "FREE CHILD MINDING SERVICE" it adds to the bring your kids to these places.

You also forget threads like this one. You forget the golden rule in marketing "there is no such thing as bad advertising" and you creating this only helps them sell their business

The same way a warp travel is peformed, by sacrificing thousands of thousands of loyal fanboys.

[MOD EDIT - Expletives contained with pictures are a no-go. - Alpharius]

 XdeadpoolX wrote:

First the stores. 90% of stores I visit have great and helpful staff. Yes they have a job to sell you more stuff you probs don't want. Isnt that what every store you go to does? be it for a new tv or video game?

Anecdotal at best. Personally, 100% of the stores I've visited in the last 5 years no longer exist, because GW could not afford to keep them open, regardless of the staffing. Also, you must be really lucky, since you seem to refer to "staff" in the plural. Where are you that GW stores haven't been reduced to 1-man operations?

 XdeadpoolX wrote:

They are always focused on the next gen of players. They dont let the lil kids come into the store and get stomped by waac and tfg. They will help guide and shape the mind of new players and when the parents see that its a "FREE CHILD MINDING SERVICE" it adds to the bring your kids to these places.

I think you're confusing GW with a day-care stocked with GI Joes... That is not a good thing.

 XdeadpoolX wrote:

You also forget threads like this one. You forget the golden rule in marketing "there is no such thing as bad advertising" and you creating this only helps them sell their business

I've personally turned several people off of purchasing (new) GW products, so... no.

 Powerfisting wrote:
So, this comes up every once in a while and I have not seen the whole scoop. Why is Games Workshop not tanking? What needs to happen for them to actually fail? And where does one find the numbers that would support an argument either way?

Because they are still making money. They are still operating at a profit (not a loss, which they would need to for a while to actually tank). They are just making less profit then they were previously.

 Xca|iber wrote:
[

Anecdotal at best.

 XdeadpoolX wrote:

You also forget threads like this one. You forget the golden rule in marketing "there is no such thing as bad advertising" and you creating this only helps them sell their business

I've personally turned several people off of purchasing (new) GW products, so... no.

Don't dismiss someone elses experience as anecdotal then provide your own anecdotal experience.

Ash from MWG made a great point in one of his shows, GW is the only company that actually tries to introduce people into wargaming, other companies just hover like carrion picking off the people that tire of GW business practices, or simply want to branch out into other games.

MarsNZ wrote:

Don't dismiss someone elses experience as anecdotal then provide your own anecdotal experience.

You miss the point. I was simply stating that my experience was vastly different than his; so you cannot draw a conclusion from either.

I never said that my experience meant that GW was losing sales... only that you cannot conclusively say that "all publicity increases their sales" when my own personal experience disproves that assertion.

 Xca|iber wrote:

 XdeadpoolX wrote:

First the stores. 90% of stores I visit have great and helpful staff. Yes they have a job to sell you more stuff you probs don't want. Isnt that what every store you go to does? be it for a new tv or video game?

Anecdotal at best. Personally, 100% of the stores I've visited in the last 5 years no longer exist, because GW could not afford to keep them open, regardless of the staffing. Also, you must be really lucky, since you seem to refer to "staff" in the plural. Where are you that GW stores haven't been reduced to 1-man operations?

I have been to various stores depending on where I live and that is why i refer to staff. Across the board I have only seen one bad staff member and I have been to probably 20 different store regularly over the last 10 years on and off

 XdeadpoolX wrote:

They are always focused on the next gen of players. They dont let the lil kids come into the store and get stomped by waac and tfg. They will help guide and shape the mind of new players and when the parents see that its a "FREE CHILD MINDING SERVICE" it adds to the bring your kids to these places.

I think you're confusing GW with a day-care stocked with GI Joes... That is not a good thing.

Im not confusing anything. Ive met a lot of younger players going into GW stores and yes they all started out as the kid that picked up everyone's models and ask too many questions but have turned out to really show a great aptitude to micromanage their armies and I have seen them destroy waac guys with ordinary lists because they have learnt in the GW store. Just because you lack the obvious patience to assist the next gen of this wargame does not mean they are GI Joe toting children. If you want to delve deeper into this we only need to look at the quality of today's gamers in general. They have sharp minds and are willing to learn and excel and GW really does nourish this need via their staff.

As to turning "several" people from purchasing a new GW product. Omg you are a guru of the counter sell. You are one person! they are a literal army of stores and sales teams who have been preying on those with a disposable income for years and years. I can say that the choice of "so... no." is completely invalid. because for the few you discouraged how many were encouraged to go out and buy something by your excellently painted mini you uploaded to the interwebs? you will never know lol




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and my apologies i cannot master the quote thingy lol

MarsNZ wrote:
GW is the only company that actually tries to introduce people into wargaming,.

Care to explain? Because that sounds ridiculous

 Crevab wrote:

MarsNZ wrote:
GW is the only company that actually tries to introduce people into wargaming,.

Care to explain? Because that sounds ridiculous

Thats an easy one. How many GW stores have an intro table where the staff member will play a fun and friendly game with you and explain the rules and phases? Every single one of them!

Now tell me where you can go to learn any other system of gaming where you can just walk in and get a intro game that isn't a local gaming group bringing a friend into the fold. Yes i am sure you could think of a few but GW has that market cornered.

Yeah, "market cornered" is different from "everyone else is a parasite"

 XdeadpoolX wrote:


Now tell me where you can go to learn any other system of gaming where you can just walk in and get a intro game that isn't a local gaming group bringing a friend into the fold. Yes i am sure you could think of a few but GW has that market cornered.

Not GW, because the only two near my house are out of business, and the next nearest one is 20 miles away, staffed by one person who cannot step away from the register for 2 hours to demo games.

I don't claim to be a business guru or some sort of anti-GW saint or anything like that, but the fact that the last 4 or 5 of GW's financial reports show a decline in revenue (i.e. actual number of sales) is almost indisputably a bad thing. I expect they will stick around for a while, sure, but when a vocal portion of your consumers (even a minority) says "Here are things we want produced/changed" and GW's says "No," followed up by 2 years of declining sales, it might be prudent to produce/change at least a few of those things the customers were talking about.

Garage gamers, the silent majority. There exists a large group of gamers who only play with a friend or two in their basement or garage. If they buy from a store at all, they show up once every few months, buy several hundred dollars worth of kits and are rarely seen again. They don't typically frequent forums, they don't play in tournaments, they don't always even stick with the most recently updated rules. They just drink a few beers, roll some dice and shoot the breeze with their buddies. They're the reason GW has shifted away from the tournament scene and towards "Play how you want," and why GW employees refer to the forums as the loud 1%. Balance isn't an issue with these players; for them COOL is king. They're the market GW is chasing, as they're the ones keeping the lights on.

GW have also taken several economical measures which, at least in short term have slowed down their financial decline.

Their prices keep increasing (so the actual sales loss isn't 100% reflected in revenue loss)

Many new rules seem built with the intent to move more models, game quality be damned.

They have acceletated their release schedule a lot.

None of these are IMO sustainable long term, but short term they make GW look way better than they really are from a financial point of view.

 Massawyrm wrote:
Garage gamers, the silent majority. There exists a large group of gamers who only play with a friend or two in their basement or garage. If they buy from a store at all, they show up once every few months, buy several hundred dollars worth of kits and are rarely seen again. They don't typically frequent forums, they don't play in tournaments, they don't always even stick with the most recently updated rules. They just drink a few beers, roll some dice and shoot the breeze with their buddies. They're the reason GW has shifted away from the tournament scene and towards "Play how you want," and why GW employees refer to the forums as the loud 1%. Balance isn't an issue with these players; for them COOL is king. They're the market GW is chasing, as they're the ones keeping the lights on.

Probably the loud 0.1%. There's roughly 30 people that play 40k at my FLGS and i've had this conversation with the majority of them:
"I read on dakka...."
"What's dakka?"
"A 40k forum where--"
"Oh. I don't waste my time reading forums."

And almost every person buys all of their GW merch at full price from our FLGS, myself included.

 XdeadpoolX wrote:

 Crevab wrote:

MarsNZ wrote:
GW is the only company that actually tries to introduce people into wargaming,.

Care to explain? Because that sounds ridiculous

Thats an easy one. How many GW stores have an intro table where the staff member will play a fun and friendly game with you and explain the rules and phases? Every single one of them!

Now tell me where you can go to learn any other system of gaming where you can just walk in and get a intro game that isn't a local gaming group bringing a friend into the fold. Yes i am sure you could think of a few but GW has that market cornered.

There are 2-3, or at least were, FLGS in my country per every large city. There is 1(one] GW shop in the capitol and from what I heard about it, it is not a place where you can play. I think there are more countries like that, then those that look like UK.

I guess we'll see if GW's new release schedule and new factions turn them around. If the trend continues from last year's report, they won't have much more to lose before they start running in the red.

LordBlades wrote:
None of these are IMO sustainable long term, but short term they make GW look way better than they really are from a financial point of view.

The trouble is that,, in a post-ebay world, wargaming isn't sustainable in the long term. It's not a consumable medium. Every kit they produce is likely to end up on the secondary market sooner or later, leaving them to compete with themselves. In order to stay profitable, they need to go the M:TG route and phase out old units in favor of the brand new ones (which won't work) or release new models that don't have earlier replacements. The increase in prices and reduced model production is a deliberate attempt to stymy the secondary market, keeping ebay prices teetering near Online-discount new kit prices in the hopes that players will just opt to pay a few bucks more to get a new item over a used one. It has met with limited success.

People talk about the shrinking player base, but the evidence is entirely anecdotal. The truth is measuring GW financials or tournament attendance tells us nothing about how many people are actually playing 40k. To do that, we'd have to track ebay and recaster sales as well as privates sales via trading forums. And that data just isn't available.

 Massawyrm wrote:
Garage gamers, the silent majority. There exists a large group of gamers who only play with a friend or two in their basement or garage. If they buy from a store at all, they show up once every few months, buy several hundred dollars worth of kits and are rarely seen again. They don't typically frequent forums, they don't play in tournaments, they don't always even stick with the most recently updated rules. They just drink a few beers, roll some dice and shoot the breeze with their buddies. They're the reason GW has shifted away from the tournament scene and towards "Play how you want," and why GW employees refer to the forums as the loud 1%. Balance isn't an issue with these players; for them COOL is king. They're the market GW is chasing, as they're the ones keeping the lights on.

I play rarely, and when I do it's in a friends Kitchen with beers, where gaming is second to socialising.

If GW bothered to balance the game and write better rules I'd buy more minis and play in a wider circle - going to clubs and attending tournaments.

You don't have to write bad rules to appeal to someone like me. If they wrote better rules, I'd spend more money with them.

If they keep financially alive and don't tank? They would have found a way out of the cycle they've been trapped in for a little while I suppose. The one where sales fall and price rises and cost cutting is meant to have a parachuting effect which sadly continues that cycle as more get priced out.

Really it likely started after the first LoTR stuff, they got a kick up the butt in profits and I suppose tried to hold onto that after it died out. They likely need to take a risk with cutting prices and increasing advertising to try to mainstream more to get more customers in the door to increase sales, but I think maybe they're unable to take that hit. There has to be some reason beyond "mah divadends guise".

Bartali wrote:
If GW bothered to balance the game and write better rules I'd buy more minis and play in a wider circle - going to clubs and attending tournaments.

You don't have to write bad rules to appeal to someone like me. If they wrote better rules, I'd spend more money with them.

Except that the rules aren't *bad*. They break down at the competitive level, which isn't the core of their market. The core rules of the system haven't changed in decades. They've simply added more things to it. Terrain rules, super-heavies, formations. It's the same ruleset with more options and less focus on, as you said, balance, because garage gamers enforce their own sense of balance through unit selection, social intimidation and houserules. *You* might buy and play more if the ruleset allowed for competitive play, but Joe Garagegamer sure loves his Baneblade, and his buddy went out and bought an Imperial Knight so he can have as much fun as Joe.

If D&D 4th ed taught the gaming industry anything, it is that the general TT gaming audience doesn't care about balance and stability. They want cool options.


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 n0t_u wrote:
They likely need to take a risk with cutting prices and increasing advertising to try to mainstream more to get more customers in the door to increase sales, but I think maybe they're unable to take that hit. There has to be some reason beyond "mah divadends guise".

The majority of their stockholders (at least as of a few years ago) are UK pensioners. Hits to the stock price and dividends means retirees have less money to live on. As I've been told, that's a major deciding factor of GW playing it safe.

 Massawyrm wrote:

Bartali wrote:
If GW bothered to balance the game and write better rules I'd buy more minis and play in a wider circle - going to clubs and attending tournaments.

You don't have to write bad rules to appeal to someone like me. If they wrote better rules, I'd spend more money with them.

Except that the rules aren't *bad*. They break down at the competitive level, which isn't the core of their market. The core rules of the system haven't changed in decades. They've simply added more things to it. Terrain rules, super-heavies, formations. It's the same ruleset with more options and less focus on, as you said, balance, because garage gamers enforce their own sense of balance through unit selection, social intimidation and houserules. *You* might buy and play more if the ruleset allowed for competitive play, but Joe Garagegamer sure loves his Baneblade, and his buddy went out and bought an Imperial Knight so he can have as much fun as Joe.

If D&D 4th ed taught the gaming industry anything, it is that the general TT gaming audience doesn't care about balance and stability. They want cool options.


Automatically Appended Next Post:

 n0t_u wrote:
They likely need to take a risk with cutting prices and increasing advertising to try to mainstream more to get more customers in the door to increase sales, but I think maybe they're unable to take that hit. There has to be some reason beyond "mah divadends guise".

The majority of their stockholders (at least as of a few years ago) are UK pensioners. Hits to the stock price and dividends means retirees have less money to live on. As I've been told, that's a major deciding factor of GW playing it safe.

This actually makes a lot of sense then.

 Massawyrm wrote:

Bartali wrote:
If GW bothered to balance the game and write better rules I'd buy more minis and play in a wider circle - going to clubs and attending tournaments.

You don't have to write bad rules to appeal to someone like me. If they wrote better rules, I'd spend more money with them.

Except that the rules aren't *bad*. They break down at the competitive level, which isn't the core of their market. The core rules of the system haven't changed in decades. They've simply added more things to it. Terrain rules, super-heavies, formations. It's the same ruleset with more options and less focus on, as you said, balance, because garage gamers enforce their own sense of balance through unit selection, social intimidation and houserules. *You* might buy and play more if the ruleset allowed for competitive play, but Joe Garagegamer sure loves his Baneblade, and his buddy went out and bought an Imperial Knight so he can have as much fun as Joe.

If D&D 4th ed taught the gaming industry anything, it is that the general TT gaming audience doesn't care about balance and stability. They want cool options.

Except the rules are bad. As in, elements of them do not function, and in some cases there is no clear indication as to the intent behind them. The biggest example is the way psychic characters work when attached to a unit, but there's plenty of other indications where the rules don't work as written. This isn't inherently an issue, because mistakes are almost an inevitibility in a document as complex as the 40K rulebook, but that's ok, because things can always be FAQ'd right?

Oh, right, apparently not.

This lack of support would be fine for a garage company or someone making rules available for free download, but it is possible to spend literally hundreds of pounds on a 40K rulebook, and even the standard prices are the most expensive of any game I'm aware of on sale.

As for Joe Garagegamer? Sure, he's having fun! The issue arises when he decides to broaden his horizons, but Johnny Noob, who Joe may have met at the local store and arranged a game with, has already given up because he built his army by collecting models he thought looked cool, and first time out got dissected by an optimised Eldar list, decided he wasn't having fun, chucked the lot on ebay and went back to Xbox.

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 n0t_u wrote:
They likely need to take a risk with cutting prices and increasing advertising to try to mainstream more to get more customers in the door to increase sales, but I think maybe they're unable to take that hit. There has to be some reason beyond "mah divadends guise".

The majority of their stockholders (at least as of a few years ago) are UK pensioners. Hits to the stock price and dividends means retirees have less money to live on. As I've been told, that's a major deciding factor of GW playing it safe.

Aside from Kirby, the majority of stockholders are institiutional investors, some of those may be pension funds, I'm really not motivated enough to do the research, but they operate on a different agenda to individual investors anyway. When GW failed to pay a dividend back along, they lost several of their existing larger investors. They were replaced with others, of course, but it is a pretty incontravertible example of the motivations of these larger institutions.

GW aren't playing anything safe. They're, at best, responding to sales of different products by doubling down and making more of what they think is similar. Trouble is, they don't know why things do well, because market research is otiose. Therefore every release is a roll of the dice as to whether they've correctly responded to past sales indicators and got either the aesthetics or rules correct. By making what they think their customers want gets us big bloated, directionless messes like 7th and cookie cutter model releases like the legion of plastic Space Marine characters that have been slowly grinding out over the last 12 months or so.

The safe way to conduct business would be to support their rules, conduct customer research, find out what their customers want and sell it to them. But GW clearly know better than to follow established and proven business practices, and that's why they're two or three reports at current pace away from making a loss.

Even though GW's profits are in decline, it is still currently profitable.

Regarding why it is still currently profitable - I think 'gamers', to a certain extent, do underestimate the volume that 'collectors' purchase.

Even with no new models or rules, but as long as the fluff is there, some folks out there will purchase the same set of Space Marine models and paint them as Ultramarines, then another set and paint them as White Scars, and repeat - throughout their lifetime.

The question is whether this core set of 'collectors', plus however many 'gamers' are happy with things, will be enough to keep GW profitable indefinitely, once it has declined to the point where all the other 'gamers' that are unhappy with GW have transitioned to something else.

Edit - Btw, I'm not saying that what GW is doing is 'right', I'm just offering a potential explanation of the current situation.

Unquestionably, that's the case for some, but their revenue has fallen in every report for the last two years or so (this means people are spending less money with them) and their profits have also fallen (despite price rises and cost cutting.)

The big issue for GW is, largely thanks to their stores, which conceivably cost more to run than they generate in income, they have a substantial overhead to cover. As a consequnce, their revenue is perilously close to dropping below their expenditure. There's nothing indefinite about GW's situation as it stands, they've essentially run out of meaningful things to cut, and it seems people aren't giving them as much money as they were.

Things are far from irretrievable, but things are equally a lot more perilous than some posters here would have people believe.