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don_mondo wrote:

JohnHwangDD wrote:
I don't think GW's GTs ever generated positive cash flow, at least not if a proper accounting were applied. I think these were always budgeted as Marketing events.

I'll agree that the GTs did not directly create a positive cash flow. But what about indirectly?

Let me tell you about the origins of the IronFist League. ... the IFL has indirectly generated thousands and thousands of dollars in sales. ... even if only 10 percent of the GT players are as actively involved in promoting GW as the IFL did, then the indirect sales generated by the GTs do far outweigh the cost of the event. But, sadly, that can't be measured.

But the biggest drawback to us doing something like that is the fact that we're the ones having to run it.

Heya Don - great points for discussion!

Indirectly, GW needs to compare GT indirect sales against WD, Apoc, FW Vraks, along with campaigns like Planetstrike and so forth. For example, based on GW's internal review of indirect sales tied to the WD BA Codex, GW decided that WD Codices didn't perform well. I assume GW does similar analysis for each of the other marketing releases. Right now, GW is very hot on Apoc, so one would conclude that Apoc is driving the most direct and indirect sales of anything they've got out there.

Now that doesn't mean that Tournaments don't drive some sales, just not as much. Prior to Apoc, I figured I had all the 40k I could ever use, primarily due to the Tournaments stopping at 2k. For example, when I was planning my CSM rebuild, I designed everything to fit within a single FOC. My sense of things is that Tournaments are OK for driving the first 2k in sales, along with pushing for some level of rules consistency, but the FOC Tournament approach is limiting beyond that point.

The IFL is tremendously cool, but I would attribute the success more to the dedication of IFL organizers and staff than to GTs or Tournaments. That is, I think you would do just fine, whether you were GT-oriented, Apoc-oriented, League-oriented, Campaign-oriented, or just plain "fun"-oriented.

And as you yourself note, perhaps 90% of the IFL is non-GT-oriented. So if GW can make more money from investing the same effort, then that is what they should do. For example, the first $90+ Apoc boxed set following a $50 Apoc rulebook probably beats the indirect sales on a $125 GT ticket.

Like you, as I'm well aware, the "cost" of organizing and manning a GT is very high. I think if you had to add up the hours of work that went into one of your events, and had to pay competitive full-time salaries for them, there is no way any of your major events could drive a profit.

Orkeosaurus wrote:

saw54 wrote:Lets not get into another hobby only elitest vs tournament players (who have a fun time competative or hobby) arguement.

Great way to avoid arguments, there.

haha i couldnt help myself...but i am quiting now.

John, probably closer to 20% within the IFL itslef. The 10% was a "what if" 10% of the GT goers were as active in promoting the hobby as the IFL attendees have been over the years. Anyways, I think the 'trickle down' effect of the GTs is pretty hard to measure. Over the years, I've done at least three armies just for the GTs. And I'm always buying new stuff for my personal favorite, IG. (New ccodex, woohoo!!) I've even got two IG armies, one for weekly play and one just for tournies. So I tend to buy two of everything that I want in my army. At least for this year, I may not be doing that. So all those new release puchases I'm goign to make got cut in half, directly due to the GT cancellation. And I'm a piker compared to some. I keep going back to my IG after playing something else for a year. Others I know do a new army every year, just for the GT. And yes, I already have heard from two or three that they're cancelling an army that they were going to do just for the GT. If only half of the GT population builds a new army for that year, the sales generated is what, 500-1000 per army? So couple hundred thousand or more in sales directly spurred by the GTs. Then the trickle down effect kicks in, generating at least that much more in sales, probably higher, as those GT players fuel the excitement locally by having and attending leagues, campaigns, and tourneys, just so they can get in some practice for the GTs.

As for Apoc, I couldn't say. While I may have thousands of points of IG, Marines, Nids, and my old GS Cult, I haven't had any desire to play them in Apoc. Don't know, something about it just doesn't appeal to me personally. Don't care much for 40K mega-battles either. Doesn't mean I don't help set up and run both within the club so others who do enjoy it can play, just means I sit back and organize/help run those events. Hell, we play it all, from Bloodbowl, Necromunda, and Epic, to 40K. Fantasy and Apoc. About the only system we don't have a strong draw in is LotR. But we've got a couple guys getting excited about WotR, so that might change.

Re paying salaries, many of the GT 'staff' are volunteers, all they get is a hotel room and some gift certificates. Many of us would volunteer just for the hotel rooms if that's what was necessary. Three or four GW personnel would be all that were needed, just enought to direct the volunteers. We're seeing this at Games Day Baltimore this year. They've actually got so many club tables (volunteers) coming in that they're not pulling in the usual 40-50 Kommando/Outrider volunteers that they've always needed to run Games Day. This will be the first year since 1996 that I haven't worked at Baltimore Games Day.............. I don't know what I'm gonna do. I didn't sign up to work one of the several events our club is running at GD as I was expecting to be working as a GW volunteer. Guess I'll just buy a ticket and wander around.

I think it's hard to measure the overall effect of GTs, simply because of self bias. If you take the same army, you're going to assume that most people keep on "GT" army on the shelf, whereas if you build a new army every season, you're more likely to assume that people build lots of armies.

The real question, I think is, is why didn't GW do what most companies do for these things: exploit local volunteer labor?

Edit: I saw the rest of Don Mondo's post, I guess they did. Huh.

Anyway, I think losing the GTs is bad for the overall development of the hobby. As an option, and as the showcase of the top talent in the hobby, GTs have at least some value as marketing and branding tools. Of course, if you're retrenching your business in a bad economic climate, you might lose some of those events to focus on more proven investments.

Polonius wrote:

The real question, I think is, is why didn't GW do what most companies do for these things: exploit local volunteer labor?

They do...................

don_mondo wrote:

Polonius wrote:

The real question, I think is, is why didn't GW do what most companies do for these things: exploit local volunteer labor?

They do...................

Yeah, I saw that and edited my post.

No GTs? Makes sense--the rules are not up to tournament standard and the codices are unbalanced.

skkipper wrote:the uk one is easy.
they own the facility
all they have to pay for is staff.
they even have a bar where you can get pints between games.

Although, the fact remains that if GW was anti-tournament because of some corporate marketing philosophy, they wouldn't have the UK events either. Although it's only one person pushing that agenda, as usual. Still, there's too many people here blaming everything under the sun, when the simplest, most obvious explanation is that the events staff is too overloaded and has too many things to sort out this year.

I'm eagerly awaiting the first person to say it's all Gav's fault.

JohnHwangDD wrote:If GW has 4 management / developer guys attending, that's 2 days on the ground plus 2 days travel = 4 days per person, = 16 staff days. With salaries likely $50/hr ($80/hr after benefits), then you're looking at $640/person/day. So 16 manager / developer days is $10k just in staff costs.

Throw in 12 hotel nights ($40/night - double occupancy), and that's another $480 in lodging.

Add 16 days of meals ($40/day - high COLA areas), and shared transportation ($10/day), and that's $1280 more.

So far, I have:
$10,240 staff
$480 lodging
$1,280 meals & transportation

That's $12k just for the GW featured guests.

Note, if you want to quibble on the numbers, feel free. Just remember that this is corporate travel so salaries, travel costs and such will apply. Go ahead and start a new topic, and we can go over it in detail.

You've built this example on a false premise. I've never attended a GT that had four VIPs from the UK. Some had one, most had none. So I've just cut this cost either to zero or by 75%.

don_mondo wrote:John, probably closer to 20% within the IFL itslef. The 10% was a "what if" 10% of the GT goers were as active in promoting the hobby as the IFL attendees have been over the years. Anyways, I think the 'trickle down' effect of the GTs is pretty hard to measure.

If only half of the GT population builds a new army for that year, the sales generated is what, 500-1000 per army?

As for Apoc, I couldn't say. While I may have thousands of points of IG, Marines, Nids, and my old GS Cult, I haven't had any desire to play them in Apoc.

Re paying salaries, many of the GT 'staff' are volunteers, all they get is a hotel room and some gift certificates.
Three or four GW personnel would be all that were needed, just enought to direct the volunteers.

Guess I'll just buy a ticket and wander around.

OK, though 10-90 is essentially the same as a 20-80 split from a revenue standpoint - whether non-GT are 90% or "only" 80% still makes the the overwhelming majority of gamers, even within the IFL. I agree that trickle-down is hard to measure.

I think your numbers are grossly high, but I don't care to dispute them too much. If you look at 5 GTs each with 90 seats, then you're talking about perhaps 250 full armies. $1000 is outrageous, given the SM dominance, so I'll agree to the $500 number (which is probably still high). But if you are right, then GW is looking at an indirect revenue bump of $100k to $250k USD retail. Whether they buy from Neal or GW locally (the extra revenue counts towards supporting the bunker/store model), GW grosses half of this before distribution, so GW corporate would see $50k to $100k revenue benefit. This is essentially comparable to the 5x $13k per event direct revenue. Given that GW probably loses $10 to $25k per event, assuming that you are right, GW *needs* at least half of the GT population to buy brand new armies just to cover the event direct loss. If less than half of the GT attendees buy all-new armies, and/or these are less-expensive armies, then GW is definitely losing money both directly and indirectly.

Per my estimate, there were 4 full-timers at the event, so that's $12k+ in cost right there.

How many hotel rooms is GW covering for the event?

____

gorgon wrote:

JohnHwangDD wrote:If GW has 4 management / developer guys attending,

That's $12k just for the GW featured guests.

Note, if you want to quibble on the numbers, feel free. Just remember that this is corporate travel so salaries, travel costs and such will apply. Go ahead and start a new topic, and we can go over it in detail.

You've built this example on a false premise. I've never attended a GT that had four VIPs from the UK. Some had one, most had none.

As I said, if you want to quibble, start a new topic.

I'll just note that the costs I gave were for costs on the ground and would have applied to GW Events organizer / other out of town manager. Whether they were from Baltimore or the UK didn't matter, as I didn't even reach a point to factor in airfare. In other words, the event was at a loss just factoring in the 4 full-timers that Don Mondo confirmed.

This proves that GW is run by monkeys.

I played in baltimore last year and about half my models I bought in the early 90's

JohnHwangDD wrote:As I said, if you want to quibble, start a new topic.

I'll just note that the costs I gave were for costs on the ground and would have applied to GW Events organizer / other out of town manager. Whether they were from Baltimore or the UK didn't matter, as I didn't even reach a point to factor in airfare. In other words, the event was at a loss just factoring in the 4 full-timers that Don Mondo confirmed.

Well, while we're "quibbling," I hazard to guess that GW also doesn't employ four events staffers with salaries of $100K+ a year. My company has a large team of events planners, and I'd guess only a couple managers are in that range. And I work in financial services, which tends to grossly overpay people, while GW notoriously underpays.

Interesting that you post obviously inflated costs to support your point, then claim those costs are somehow off-topic for the conversation.

I bet the GTs come back in some fashion. One of the huge costs to GW US was shipping tables and terrain thousands of miles.

I also think there's a certain amount of, "if we can't do it better than the Indy GTs, we shouldn't do it" at work - and I don't disagree with that. If people are going to set up and run a tourney, it's a lot cheaper for GW to just give prize support. Most stores can get $150 US in prize support at least several times a year to help sponsor local tournies.

Indy GT in Florida Jul 24-26

WWW.THENECRO.COM

Does this mean more non-GW parts can start sneaking in to tourney armies? Do indy GTs get (or need) prize support or promotion from GW with restrictions attached, or are most indys totally, well, independent of all GW support?

Perhaps this will lead to an explosion of new modeling possibilities, and maybe models from companies that can undercut GW's prices. West Wind heads are now looking better than ever. And if those Wargames Factory greatcoat guard models turned out well, they might have a whole new appeal.

Savnock wrote:Does this mean more non-GW parts can start sneaking in to tourney armies? Do indy GTs get (or need) prize support or promotion from GW with restrictions attached, or are most indys totally, well, independent of all GW support?

Perhaps this will lead to an explosion of new modeling possibilities, and maybe models from companies that can undercut GW's prices. West Wind heads are now looking better than ever. And if those Wargames Factory greatcoat guard models turned out well, they might have a whole new appeal.

I'm already seeing plenty of this as it is.

Right now, I have near zero compunction to not use another companies mini's for parts of my army - most of the GT's I care about are Indy events anyway.

Savnock brings up a point I think is being overlooked. The GT circuit was a GW models/ or at least a large portion of conversions were GW models.

With no Gw only tournaments, I wonder how many sales will be lost to cheaper models that look like GW stuff but aren't?

Not a bad question, without official GW tournaments why bother over paying for their models? New IG are a good example, they're increasing the price per guardsman with the new packaging scheme so why not just go out and buy all of the other model ranges that easily pass for IG but are significantly cheaper, and more often than not look better?

Hmmmmm...... GW just cost themselves $2000 in models $100 in paint and glue and $250 in entry fees because I won't be going to balitmore or vegas this year. Damn.... Way to go GW! At least you could have told me earlier so I could have planned to attended adepticon!

vonjankmon wrote:Not a bad question, without official GW tournaments why bother over paying for their models? New IG are a good example, they're increasing the price per guardsman with the new packaging scheme so why not just go out and buy all of the other model ranges that easily pass for IG but are significantly cheaper, and more often than not look better?

This might work for other Indys, but Adepticon still enforces GW/FW models only(aside from the Adepticon exclusive models, of course), so if you want to play there, you'll need an all GW army.

Past years, there have been more than four actual GW personnel, I'm saying they can/could run a GT with four paid personnel, filling more slots than they do now with volunteers. And their (GW) salaries are a lot lower than you have surmised. I don't quite make what you've postulated, and I'd have to take a huge pay cut to work in GoGo's spot.

However, you did miss a couple of the major expenses: 1. that is trucking all the scenery/tables to the GT location. IIRC, GoGo told me that runs about $5K, so we chop the salaries and add that in and we still come out about the same. 2. And then of course, the venue rental. No idea on that, but that is a major chunk of the cost of the event. The actual costs for GW employees is a minor matter compared to venues that can accomodate 250 or so gamers (ie 125 4'x6' tables), plus judges tables, etc. And the only hotel rooms GW pays for are theirs, plus rooms for volunteers, who double bunk or bunk with GW employees (I had Dave Taylor as a roomie a couple years back at one of the Games Days).

Base numbers for attendees, last year, three GTs, Baltimore, Chicago, and Vegas. Chicago bombed, primarily (IMO) due to it's date, being sandwiched in between Vegas and Baltimore. They made a mistake in scheduling, running three GTs in three months.
BaltGT, 245 players
ChiGT, 115 players
VegasGT, 247 players
So over 600 attendees at just three GTs last year, with one of them having a lower than expected attendance. SO if we say even half of those build new armies at approx $500 each, then we come up with about $150K in sales directly generated by the mere existence of the GTs. And then the trickle down starts. Even if we chop that figure in half, then at worst, factoring in the sales generated directly from those attending and building new armies for the GT, and lowballing the profit figure, we'll say $25K profit. And they're also getting 600 x entry fee as well, last year $125 IIRC, so another $75K. So that gives them a little less than $35K per event for three events before they start 'losing' money. IMO, they at least break even once you factor in the probable sales to players prepping for GTs, and then the trickle down from those players onto their local community actually generates positive revenue for GW.

Anyways, it's interesting to run the possible numbers for revenue generated, but very hard to nail anything down as solid. Sure, some players use old, old models or the same army, some build all new armies. Some go back and forth (Me.). I'm just going to hope that the GTs do come back and that they are new and improved. I've been pretty happy with them for the last couple years, and hopefully GoGo will be able to continue them in an upward trend.

If you want to go to a very nice event in SE US try the Maul at the Mall.
I've been there a few times and it keeps getting better. $1K in prizes this year!!!!

asugradinwa wrote: At least you could have told me earlier so I could have planned to attended adepticon!

This is my biggest gripe. They waited to long to say something.

malfred wrote:Too bad AgeofEgos knows be my name and face now. I can't make fun of him (as much).

Heh, the vacuum of the internet has began to diminish. Formerly, I had a minds eye image of your disembodied bag with eyes, opening it's pouch and speaking your posts out in a James Earl Jones voice.

Now, I have a minds eye image of your bag with eyes, opening it's pouch and speaking your posts aloud in a James Earl Jones voice.....while this person holds it high above their head in a submissive stance.

/It was nice to meet some of the Dakka members

winterman wrote:I doubt they are gone for good. I think they were unable to get both Canadian GT/conflicts and US GTs going while the consolidation was still taking place. What we will probably see is one big circuit in US and Canada. I for one would be glad to see one large circuit -- cheaper for me to attend a Canadian GT in Vancouver or Edmonton then one in Baltimore. Would also mean Astronomicon would probably be added to the circuit as an indie, which is pretty cool as well. Time will tell.

Doubtful unfortunately, they will most likely only run a few events in the most populous of cities.

Besides that I dont think the consolidation really hit them that hard, there is only 5 major canadian events; Toronto, Vancouver, Montreal, Gamesday and the GT (which is at the bunker so it shouldnt even count), besdies that there is the hall of heroes and posting all the indy events on the website.

Hmmm... is the GW-only ruling at Adepticon so strict that West Wind heads would disqualify one? I can respect the decision if so (after all, it makes modeling a bit more challenging to restrict materials).

But for other events, I'll be breaking out the Warzone figs and kitbashed Chimeras to get into the new IG.

Savnock wrote:Hmmm... is the GW-only ruling at Adepticon so strict that West Wind heads would disqualify one? I can respect the decision if so (after all, it makes modeling a bit more challenging to restrict materials).

"Models must include primarily Games Workshop or Forge World pieces (where applicable) supplemented by other hobby-based building materials (i.e. green stuff, plasticard, foamcore, elements from AdeptiCon sponsors, etc)"

Also, the old Armorcast 40K models are allowed.

From a simple cash flow standpoint, it makes sense to cancel GTs if their cost is indeed grossly out of line with whatever revenue they generate. I would seriously doubt, however, that their cost would be that high given their vertical integration. The highest cost for an "event" is almost always the rental fee for the building you're hosting it in. If you don't have a lot of fancy caterers or expensive A/V display contractors/consultants, then the rent is going to be the highest cost.

JohnD posted some numbers that are largely bogus when thinking about things logically; highly paid staff are either consultants or salaried. If you don't bring any consultants then your "cost per day" in wages is effectively $0 beyond time lost on the job, and four days isn't going to cost the company anything in oversight. Lodging in a large city runs about $120 per night if you book in advance, with a $25.00/meal allowance, so even a "high profile" GW staffer would only cost an average of about $205.00 per day after direct travel expenses (plane ticket). I based these numbers off of my own travel expenses for the last year, which included about 7 business trips to larger cities. And I work for a company much, much larger and more successful than GW.

From there I think it would depend largely on their accounting system for determining the value of prize support to generate the "loss" from prizes. If their accountants calculate the cost as wholesale value, then they haven't lost much, but if they base it off of what the model boxes would have sold for at retail price in a GW store, then obviously it's significantly more red ink on their balance sheet. Who knows how they actually do it.

But the largest hit should be space rental. I don't know what a convention hall on the east coast/Vegas costs, but most definitely in the thousands/day and I could realistically see it being tens of thousands/day.

So yes, GW probably saves some money by not running US GT events. However, this is a move that requires either brass balls or a lack of business sense. No company can "save itself into a profit", especially a retail-level company. By reducing their event presence there is a real risk of losing market share because they become just another game system on the shelf. I'm not saying they'll go belly up as a result of canceling their GTs, but GW just lost a whole lot of presence amongst competitive US hobbyists. This is a huge opportunity for some other system like Flames of War to step in and grab some market share.

I'm sure GW will rely on their young teen/youth recruitment in GW hobby stores model, but this sort of consolidation smacks of protectionist profit protection, not growth and expansion of a healthy business.

Per my estimate, there were 4 full-timers at the event, so that's $12k+ in cost right there.

Can't really count salaried workers pay. They are on salary, which means they get paid the same no matter how many hours they work or don't work. Now if they get paid an hourly wage, then it should get factored in. Otherwise, you can really only count travel cost and expenses.

EU tournaments are still going because they probably get a better turn-out. After all, it is easier to travel over there with their far better public transportation system. And if memory serves, they actually do tournaments for some of the other games, such as BFG and LoTR.

Why don't they just combine GD and GT? Seems they would get even bigger turn-outs if they did.

Nurgleboy77 wrote:If you want to go to a very nice event in SE US try the Maul at the Mall.
I've been there a few times and it keeps getting better. $1K in prizes this year!!!!

Seconded. The locals here are pretty friendly and aside from the usual tools a pretty well balanced crowd. The promoters are truly interested in promoting the hobby as a whole and making sure everyone has a good time.