GW Shares Drop As Operating Profit Falls Vs LY - NEW report for 1/2015 page 21

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**Henry**

Shadow Captain Edithae wrote:
For GW's Hobbit and LOTR customers, yes. There are several members in the Great British Hobbit League on facebook who are dedicated collectors of The Hobbit Lego (one particular guy made a huge Lego Helms Deep diorama).

Well that settles what random thing I'm Googling tonight. Give me a mo...

Rivendell ... all of it .... what the hell!? People do this for a hobby?
How much would something like that cost?
That's the sort of dedication to a hobby that GW could only dream of.

**insaniak**

Talizvar wrote:
It boils down to GW has to compete for our disposable income across more streams than it ever had before..

I dont think it really does. People are still buying miniatures games. The issue is that GW have lost sight of what they used to do best (which is to make a game that people enjoyed playing, that had cool minatures) in favour of producing shiny miniatures and flashy books aimed at people who want to 'collect' rather than the people who want to play, because they think that their customers are more interested in looking at their stuff than in using it to play the game.

**Davor**

Smacks wrote:
I agree with a lot of what Yodhrin wrote.

The Jaw drop and expletives followed, and then he looked at me like I was an idiot. Because, honestly, who other than an idiot would pay such vast amounts of money for plastic soldiers. I don't think this is an uncommon response.

Especially when you can buy toys already assembled and painted for less cost as well. A lot of people look and say, you have to cut them off the mold, glue them and then paint them and also pay more for it?

Automatically Appended Next Post:

Talizvar wrote:
It boils down to GW has to compete for our disposable income across more streams than it ever had before.
It just is not shiny enough in the new hotness to have much of a chance.

Tablets and phones consume product a dollar at a time convenient and immediate.
Kickstarters are allowing us to spend money on what we want to see hit the shelves.
Steam has a multitude of sales for all manner of games that the iStore has not provided.
X-box and Playstation have an online store as well to download whatever you want on the console.
Same applies for my kids 3DS portable games.
Netflix has created "binge watching" as a phenomenon, not much time to put models together when you have 5 seasons of show to catch-up on.
Really well made board games and table-top games have come out to allow an almost immediate ability to play: a good draw for those not talented enough or patient enough to spend the time.

This list is mainly my own personal excuse of why I am not spending dollars to keep GW in the black, having so much money tied up in models I do not use much is the main motivation for feeling guilty about not playing. I should be driven towards being excited to play which has not been the case lately.

Too many other things bring me that joy that GW seems to have fallen behind the times in doing.

Looking back at the veteran "anti-marketers" I can see why it happens: GW was capable in the past to bring out that gaming joy easily, there is a sense of betrayal when the old "go-to" just does not scratch that itch anymore.

Problem is, I believe, GW doesn't believe these are competition. They don't see people buying Xbox or PS or 3DS or Lego or what ever as competition. The way I see it, money being spent on something else beside GW it is competition. A lot of times, is, do I buy a new video game or do I buy 40K? Guess what, I find better value in a video game than I do with 40K. So my money goes on the video game. If that is not competition, I don't know what is then. If I found better value in 40K, then I wouldn't be buying video games then.

**weeble1000**

Davor wrote:
Smacks wrote:
I agree with a lot of what Yodhrin wrote.

The Jaw drop and expletives followed, and then he looked at me like I was an idiot. Because, honestly, who other than an idiot would pay such vast amounts of money for plastic soldiers. I don't think this is an uncommon response.

Especially when you can buy toys already assembled and painted for less cost as well. A lot of people look and say, you have to cut them off the mold, glue them and then paint them and also pay more for it?

Lol, that's a trick the model industry pulled a long time ago. Let's convince people that finishing our products for us is part of the fun, and then we'll charge them more for it!

Seriously though, it is part of the fun, but it does cost a lot less to manufacture what amounts to an unfinished good.

**AlexRae**

I don't understand why GW dont do more online exclusive bundle deals with notable discounts. When they released the boxes for the first ever dataslates like the Tau Suits or the Marine StormWing they got everyone excited because they were great value and it led to people willingly spending more money with GW. Regardless of the profit margin it resulted in more money passing through the tills and in many cases money that otherwise would not have been spent with GW.

This was also the case when they released those boxes for Apocalypse which included formations.

Rather than 'one click' bundles that no idiot will buy, why not provide online bundles for current or popular formations such as Adamantium Lance or the new Blood Angel triple Stormraven/Tactical? Right now if I want to buy Adamantium Lance, I am logging on to AliExpress, not GW.com.

**Verviedi**

Something killing GW is also the lack of support that corporate gives GW stores. If stores were actually allowed to use all the space they have available and host events more often, people would view them as FLGS, not hellholes.
Also, store managers are forced to call every model a good buy. Whenever someone brings up something like how Lychguard are terrible, the managers will say something like "They are a hobbying challenge" or "You just don't know how to use them."

**H.B.M.C.**

insaniak wrote:
Talys wrote:
LEGO is ridiculously expensive, and a terrible value relative to any alternative. And yet, at least in my area, it is freaking impossible to buy the sets that my nephews and such want as Christmas presents unless you buy them like, 4 months in advance.

I spent a few hundred dollars on 3 LEGO gifts this year. The one Imperial Destroyer I bought literally costs more than a Titan-sized model. A Death Star is more expensive than 95% of forge world models ($500+). I mean, FFS, 40k is cheap compared to LEGO lol lol.

He wasn't talking about price.

Lego lost track of who their customers were and what they wanted for a while there, and it nearly broke them. The issue was never about price, though, it was about offering product that the people who were actually buying their product wanted to buy.

Which brings us to GW's "they'll buy what we make" attitude, which they've expressed in the past. With that sort of attitude no wonder things are getting worse.

Davor wrote:
Problem is, I believe, GW doesn't believe these are competition.

That comes down to GW's insistence that they are "The Games Workshop Hobby", rather than simply a (large) cog in the overall miniature wargaming hobby. They don't see themselves as having competition as no one else makes GW minis, so how could they have competition (this could also factor into why they went after CHS - the first company to make GW minis that wasn't GW... even though CHS don't make GW minis, but that's another story for another time).

**Red Corsair**

GW puzzles me. Imagine the number of young new players something like a Saturday morning cartoon for 40k would make. Heck or even a real budget movie, not that crap they tried in the past.

Couple it with actual starter sets that contain one faction (eliminating the need to sell half the crap) that each have a cheap print booklet with EASY start up rules and presto, your back in the game.

That wouldn't even require reconciling the vets and it would be huge for them. Though it would obviously only make things better if they did.

Rules should be free for download, offer high quality print, but lower the bar for entry for those who would be intimidated by the prospect of needing $135 before they have even assembled a fig.

Has to be one of the worst teams around currently. So puzzling, so unfortunate.

**Smacks**

weeble1000 wrote:
LEGO had, for a long time, foregone market research because the company assumed it knew who its customers were and what they wanted. For example, LEGO had never tried to produce products that appealed to girls.

I don't know if that is a good example. LEGO did have things like the Paradisa range in the mid 90s which was essentially LEGO Barbie, and was probably a response to slumping sales. But that was exactly the attitude that almost lead them into bankruptcy. What happened was they got rattled by computer games and other competing toys, so they tried to expand and innovate their way into new markets and lean on their brand. The problem was they didn't find the 'runaway successes' innovation that they were looking for. What turned LEGO around was the decision to get more competitive and fight for their own share of existing markets.

**Baragash**

Edited for not enough coffee yet this morning

**Daedleh**

That's last years...

**AlexRae**

If we are talking about baffling business practises, the top top top of the pile is a company that's sales model is built around new customers coming into the hobby yet refuses to spend a penny on advertising and actively avoids their product being stocked in large chain stores.

That's quite literally mind-boggling levels of stupidity.

**AllSeeingSkink**

AlexRae wrote:
If we are talking about baffling business practises, the top top top of the pile is a company that's sales model is built around new customers coming into the hobby yet refuses to spend a penny on advertising and actively avoids their product being stocked in large chain stores.

That's quite literally mind-boggling levels of stupidity.

They don't spend money on mainstream advertising, they do have their stores and video games though which I'm sure they consider as basically being an advertising-type thing.

**Kilkrazy**

GW's business model is based around new young customers being drawn in by exposure to the game from older brothers, cousins and uncles, etc.

Part of the reason why the sales are in decline is that increasingly the brothers, cousins and uncles are pointing the young potential recruits to other parts of the general wargame hobby instead of GW.

**Herzlos**

AllSeeingSkink wrote:
AlexRae wrote:
If we are talking about baffling business practises, the top top top of the pile is a company that's sales model is built around new customers coming into the hobby yet refuses to spend a penny on advertising and actively avoids their product being stocked in large chain stores.

That's quite literally mind-boggling levels of stupidity.
They don't spend money on mainstream advertising, they do have their stores and video games though which I'm sure they consider as basically being an advertising-type thing.

The stores only work as advertising if the customer walks past them [1] and they are busy [2] with people having fun.

Because of the cost cutting they are witnessing the following problems with the above:
[1] The stores are moving to smaller locations with lower footfall - less people see them, and you more or less need to know they exist to go looking for them
[2] The one-man model and reduction in opening hours / gaming space means the stores are quieter, so there's less chance customers will stumble across someone having fun playing the game.

There will be some cross-over from the big ticket video games (like Space Marine), but there won't be much for the Apps, which are mostly derivative and very expensive for what you get. There will still be nothing like the customer take up as when you could buy Hero Quest or Space Hulk in any toy store.

**AllSeeingSkink**

Herzlos wrote:
AllSeeingSkink wrote:
AlexRae wrote:
If we are talking about baffling business practises, the top top top of the pile is a company that's sales model is built around new customers coming into the hobby yet refuses to spend a penny on advertising and actively avoids their product being stocked in large chain stores.

That's quite literally mind-boggling levels of stupidity.
They don't spend money on mainstream advertising, they do have their stores and video games though which I'm sure they consider as basically being an advertising-type thing.

The stores only work as advertising if the customer walks past them [1] and they are busy [2] with people having fun.

Because of the cost cutting they are witnessing the following problems with the above:
[1] The stores are moving to smaller locations with lower footfall - less people see them, and you more or less need to know they exist to go looking for them
[2] The one-man model and reduction in opening hours / gaming space means the stores are quieter, so there's less chance customers will stumble across someone having fun playing the game.

There will be some cross-over from the big ticket video games (like Space Marine), but there won't be much for the Apps, which are mostly derivative and very expensive for what you get. There will still be nothing like the customer take up as when you could buy Hero Quest or Space Hulk in any toy store.

Yeah I'm aware stores have lost a lot of their potency as advertising tools over the years, but the fact they do still exist as a form of advertising is all I was pointing out.

**AlexRae**

That is not spending money on advertising.

That is hoping people will walk into your shops, which as Herzlos said are now moving out of larger Malls and centres and to cheaper smaller locations with much less foot fall.

They don't even have a proper PR department. They don't even engage with 'known' people who like their stuff, which is also ridiculous.

**Azreal13**

It is spending money on advertising, anything that increases the public's awareness of your brand can be deemed advertising.

It isn't direct advertising (radio/TV/press advertising - the type where you pay a third party to feature your products/company in their output) but it is a form of indirect advertising.

I sort of agree with their approach, if not their execution. Indirect advertising is much more subtle, and therefore can often be considered more effective, and a lot less likely to be lost in the noise of a dozen other similar ads in the magazine/tv show that would likely be competing for attention.

Red Bull are the masters of this form of advertising. While they do spend money on conventional advertising, it is the F1 Team, Football team, sponsorship etc which I've seen cited as the most effective advertising they do, it is a highly effective way of creating a link in your customer's minds between your brand and the sort of imagery you wish them to associate with it.

So while I'd certainly dispute the efficacy of it as a strategy, it isn't really accurate to call using your shops as a main method of attracting customers not advertising.

**agnosto**

Herzlos wrote:
There will still be nothing like the customer take up as when you could buy Hero Quest or Space Hulk in any toy store.

Warning, armchair CEO-ing about to commence:

This is what needs to happen. GW needs to lose the whole "collectors only" ideology if they actually care about the bottom line. If I were king for a day....
1. Entry Level: A fantasy and a sci-fi board game made with board game plastic, not real miniatures. Simple rules but uses the same stats as the main games (WS,BS...) This would be the low-cost, interest-building entry into the greater GW universe. I'd market this and place it in every toy and big box store, everywhere with ads and information in the boxes about other offerings and fluff/background.
2. Mid Level: Mordheim, Bloodbowl, Necromunda. Make these snap-fit, hard plastic models. Provide painting tutorials in the boxes. team/gang sets with small pots of paint, brushes and painting tutorials. Big box comes with rules, card terrain (buildings, playmat, etc), fluff, information, etc but no models at a lower cost so consumers can buy the teams/gangs they want to play.
3. Advanced Level: WHFB, 40K. full, hard plastic kits. Starter rules available online for free. "Advanced" rules purchasable in two formats, hardbound "collectors" and softbound editions. Unit rules included in boxes. Actually take the time to hire quality writers and playtesters to ensure the rules are worth a damn..

A couple of thoughts...

**squidhills**

agnosto wrote:

2. Mid Level: Mordheim, Bloodbowl, Necromunda. Make these snap-fit, hard plastic models. Provide painting tutorials in the boxes. team/gang sets with small pots of paint, brushes and painting tutorials. Big box comes with rules, card terrain (buildings, playmat, etc), fluff, information, etc but no models at a lower cost so consumers can buy the teams/gangs they want to play.

I have to take issue with this idea. Have a boxed set with rules and terrain but no models? That will not make customers happy. That is not much different from how 40K/Fantasy is set up now, where you buy 1 product (the DA/Chaos box or the SW/Ork box) and think you're getting the game, only to find out that you need to buy $800 more models and $100 more in books to play an actual game. If you're going to sell Mordheim or Necromunda, put two bloody gangs in the box so that people can buy one thing and start playing right away (well, after the models are assembled) and with no further money spent on stuff. Mordheim and Necromunda were done right when they first came out; that is one formula GW doesn't need to fix.

**AllSeeingSkink**

AlexRae wrote:
That is not spending money on advertising.

That is hoping people will walk into your shops, which as Herzlos said are now moving out of larger Malls and centres and to cheaper smaller locations with much less foot fall.

They don't even have a proper PR department. They don't even engage with 'known' people who like their stuff, which is also ridiculous.

Hoping someone walks in to your shops which have big "Games Workshop" signs and miniatures in the windows is a form of advertising. It's why GW shop keepers are trained to jump all over anyone who walks in the store to try and either get them in to an intro game if they've never played before or get them to buy something if they are a return customer. Instead of going for broad advertising in magazines/TV/bus stops they prefer getting hold of less people but in a more controlled environment.

GW also make arrangements (or at least used to, not sure if they still do) with FLGS's to have posters and banners and whatnot showing in and outside of stores. That is again a form of advertising.

Then you have the video games I mentioned earlier.

You can argue the effectiveness of those forms of advertising, but they are definitely forms of advertising. I actually think more mainstream advertising probably wouldn't be as effective as it is for video games, music and movies because of the niche nature of wargames.

Though I don't disagree moving stores away from areas of high foot traffic severely limits the effectiveness of using stores as advertising (there are still stores in some shopping centres around this area, though several have moved away to areas of lower foot traffic).

**agnosto**

squidhills wrote:
agnosto wrote:

2. Mid Level: Mordheim, Bloodbowl, Necromunda. Make these snap-fit, hard plastic models. Provide painting tutorials in the boxes. team/gang sets with small pots of paint, brushes and painting tutorials. Big box comes with rules, card terrain (buildings, playmat, etc), fluff, information, etc but no models at a lower cost so consumers can buy the teams/gangs they want to play.

I have to take issue with this idea. Have a boxed set with rules and terrain but no models? That will not make customers happy. That is not much different from how 40K/Fantasy is set up now, where you buy 1 product (the DA/Chaos box or the SW/Ork box) and think you're getting the game, only to find out that you need to buy $800 more models and $100 more in books to play an actual game. If you're going to sell Mordheim or Necromunda, put two bloody gangs in the box so that people can buy one thing and start playing right away (well, after the models are assembled) and with no further money spent on stuff. Mordheim and Necromunda were done right when they first came out; that is one formula GW doesn't need to fix.

So, a $40 rule book that comes with cardboard fold-out buildings sucks? People gripe about the models that come with the starter boxes now. Just as well not sell a box then just the rule book and then everything else as optional.. *shrug* can't make everybody happy I 'spose.

**gameaa**

Since these points unavoidably go back to price like a main issue, I recently listed out there what I've invested approximately on my Khador armed service for Warmachine.

**squidhills**

agnosto wrote:

So, a $40 rule book that comes with cardboard fold-out buildings sucks? People gripe about the models that come with the starter boxes now. Just as well not sell a box then just the rule book and then everything else as optional.. *shrug* can't make everybody happy I 'spose.

Customers don't like hearing "buy this thing, then buy these two other things before you can use the first thing you bought". They would much rather hear "Buy this one thing then start playing". That is why Space Hulk sold well, and Mordheim, and Necromunda. Casual players, who don't have a huge number of models already, could just drop $100 on a big box and get everything they needed to play the game; rules, minis, dice, templates, and crappy cardstock terrain.

**PhantomViper**

agnosto wrote:

So, a $40 rule book that comes with cardboard fold-out buildings sucks? People gripe about the models that come with the starter boxes now. Just as well not sell a box then just the rule book and then everything else as optional.. *shrug* can't make everybody happy I 'spose.

"People" don't gripe about the models that come in starter boxes, only experienced players / gamers and other people that already know the product even have enough information about it to decide what specific models they wan't if any.

Starter boxes are not aimed at those people, they are aimed at grabbing a person that just came of the street and knows nothing about a specific product. And those people will vastly prefer a self contained package that allows them to play the game right away instead of requiring them to buy other things before they can start enjoying their purchase.

Pretty much all the boxes for GW specialist games were pretty good in this regard, having everything in them that was required for that specific game to be played.

**agnosto**

It's funny but this is exactly the kind of conversation that GW should be having with its customers but doesn't.

**frozenwastes**

agnosto wrote:1. Entry Level: A fantasy and a sci-fi board game made with board game plastic, not real miniatures.

This isn't the way to go. GW has already paid for their design equipment, their tooling equipment and their injection moulding machines. There's no reason at all for them to switch to a different material or process.

**Shadow Captain Edithae**

frozenwastes wrote:
agnosto wrote:1. Entry Level: A fantasy and a sci-fi board game made with board game plastic, not real miniatures.

This isn't the way to go. GW has already paid for their design equipment, their tooling equipment and their injection moulding machines. There's no reason at all for them to switch to a different material or process.

Well at the very least, they could add colour tints to the plastic models in Specialist Games / Starter sets to differentiate the two sides like Space Hulk did (red Terminators, purple genestealers IIRC). That would turn the models into classic board game pieces.

For the Dark Vengeance set, chaos could be red and the Dark Angels green.
Battle for Macragge, purple genestealers and blue ultramarines.

etc.

Better than bare grey plastic minis that all look the same with no paints and brushes included, and with the box being marketed at a demographic that typically have never painted minis (new hobbyists).

**frozenwastes**

Oh yeah, GW has definitely done different coloured plastics. They've done red and dark blue and white and others over the years. I'm just saying there's no reason to switch to a different process when they already have the infrastructure for their current approach.

I do really agree that they need to come up with a new product to sell through every sales channel available to them. A complete game experience designed from the ground up to compete with everything else out there through the same distribution and beyond. Department stores, general toy distribution, any and everywhere that will get more of such a product into the hands of as many people as possible.

**Theophony**

Think its about time to move this to general discussion?