Virtual Goods and The New Digital Retail Revolution

Earlier this week, New York City’s Jacob K. Javits Center played host to a convergence of two trade shows, as both the 107th American International Toy Fair and Engage! Expo welcomed a diverse group of exhibitors and speakers.  For certain attendees, the pairing of Toy Fair with the Engage! Expo, a conference that focused primarily on virtual goods, might have at first seemed somewhat out-of-place.  Beyond the giant stuffed animals, puzzle games, and highly popular robotic hamsters that populated much of Toy Fair, Engage! showcased  leading entrepreneurs in the new digital retail phenomenon – the virtual goods industry.

As reported by Inside Network and covered here on, this year, the virtual goods industry is projected to drive $1.6 billion in revenue in the U.S. alone.  While the ability to purchase virtual goods has existed in online communities for quite some time now, the phenomenon that is social gaming hasushered in a brand new audience for microtransaction purchases – the general consumer.

While traditional retailers and toymakers struggle to survive the stormy and rather unpredictable economic recession, the virtual goods industry is booming.  Selling non-physical items, the providers of virtual goods have seen just as much (and presumably more) success than long time brands and veterans of the physical toy industry present at the Javits Center this week.  The reason for such success is simple – the provider of the virtual good, which can be looked upon as a modern toy manufacturer, is smarter and armed with more consumer information than the producer of the antiquated physical retail toy.

Continue reading Virtual Goods and The New Digital Retail Revolution

Slow Sales and a Larger Audience Spells Change for the Games Industry

Used Games

June NPD data showed the game industry’s sharpest decline since 2000, with overall sales dropping 31% from this same time in 2008. The sales decline contrasts sharply with the fact that 4 million new gamers have entered the industry in the past year. The rise in audience size alongside a sharp drop in sales signals an emerging trend that players are increasingly turning to affordable digital content, free-to-play online game portals and casual games for interactive entertainment.

With Gamestop openly stating that their margins are being buffered by used game sales, protecting them from the sharp decline, one has to wonder if the sales slump is a temporary trend, or a permanent change. GameStop’s stranglehold on the used game market has caused many publishers and developers to explore alternative distribution outlets via online distribution platforms and console based marketplaces, and thus the quality of digital content has increased monumentally over the past year. Continue reading Slow Sales and a Larger Audience Spells Change for the Games Industry

USA Today, Reuters Reserve Spot To Talk Target

Earlier this week, Target announced a new nationwide game reservation program that will allow its guests to reserve notable games by purchasing a $1 reservation card.

Here’s what some outlets are saying …

USA Today
“Retail chain Target is joining GameStop and Best Buy in starting a reservation program that allows consumers to reserve popular titles, according to a statement from the company. … Of course, Target isn’t the only one who incentivizes for reserving copies of games . GameStop often includes various perks for pre-ordering, such as exclusive, in-game items. Readers, what do you think of Target’s strategy?”

“Target already lets customer place preorders for video games on its website. But Thomas said it the in-store reservation program has an added benefit  — it will hopefully bring shoppers into its stores more frequently. They can come into its stores to make the reservation, to pick up the game when it’s released, and then again to use the gift card.”