Is Coronavirus going to be the final tipping point that ends Gamestop or at least forces bankruptcy?

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bigsocrates

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Obviously Coronavirus is going to have many more important effects on our society (stay safe everyone, and most importantly try to keep the elderly and health-compromised people you know safe) than its impact on video games, but I do think it's worth considering whether this is going to bring down Gamestop once and for all. Games have been moving towards digital distribution for a while, which is the main reason Gamestop has been circling the drain, and while people being stuck indoors for a few months won't impact video games more than any other industry (everything is going to be hit by the coming recession and entertainment is one of the first expenses to go), retail is one area that's going to be disproportionately affected. If people aren't supposed to go out except for essentials they are not going to go buy video games or collectibles in a retail store, and Gamestop can't afford to see its business dry up for a few months (let alone longer than that.) In addition, if people are pushed towards digital distribution by this they might not go back after. A lot of people still buy physical at a store out of habit and this could kill that habit.

I honestly wouldn't be surprised to see Gamestop's inevitable bankruptcy be sooner and much worse than everyone was expecting. Mom & Pop stores will be affected too, of course, but many of those stores have loyal customers who want to support them and might return after this has passed. Gamestop is just an interchangeable convenience for most people.

Coronavirus may change the movie business forever, for somewhat similar reasons, but I don't think the big theater chains will go out of business because movie theaters still have something unique to offer and there are lots of people who will want to go back after this has passed. I can't say the same for Gamestop.

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Shindig

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I'll say yes. On the one hand, there's a potential rise in demand for media and games as more people self-isolate or are confined to their homes. Unfortunately, that might just push more to the convenience of digital.

Even if they pivot quickly, they'll be moving into an already packed sector from scratch. This might finally end GAME in the UK.

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chaser324

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#3 chaser324  Moderator

The economic impact of the coronavirus is going to be massive, both on individuals and businesses, and I can definitely see retail chains like Gamestop being among the businesses that may not be able to weather this.

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regularassmilk

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Gamestop has been declining, in a public way, for a long time. Their stores are starting to look like FYE stores, which is even more grotesque, because at least FYE was kind of an all-purpose media store. The candy and toys and t-shirts that are infiltrating Gamestop is even weirder.

They should have pivoted to being a gigantic, online-only games retailer about five years ago. They might have had a chance to corner the market there, even if their company would've shrunk a lot in the end. Now it looks like this will end in tears for them.

I'm hesitant to say that Coronavirus is going to be the straw that breaks the camels back, because Gamestop has seemed like it has been in its death throes since 2017.

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the_hiro_abides

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#5  Edited By the_hiro_abides

GameStop Has No Idea What to Do About Coronavirus

A Patrick Klepek article about what is currently happening at GameStop locations.

If TLDR, GameStop is like cleaning is important. We'll send supplies. That fell through. Buy some. We'll reimburse you.

Also only have 10 people or less in the store at all times.

There was also a new article today about how employees should hand law enforcement a flyer that GameStop is "essential", therefore should be open.

Anyway, it's hard to not look at these tactics as desperate and further confirmation of the company's eventual collapse.

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bigsocrates

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@the_hiro_abides: I didn't think I could have less respect for Gamestop than I already did, but I will...continue not to buy from them no matter what. Just horrific. Risking people's lives to try to sell insurance policies on used games and FUNCO pops. Just pathetic.

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hansberg

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From what I recall they still have a lot of cash, so if that holds true then they should be able to hang around a bit longer. The bigger issue will be if (and I suspect this will come to pass) they still miss their estimates with the release of the new consoles.