Best Buy GCU is being Discontinued?

[thesuzukimethod]

What exactly is special about this newsweek article that keeps getting posted? Besides a blatant attempt to give them clicks?

There are no revelatory bits of information to be gleaned from there. It is just speculation. Stop giving them clicks.

It's not speculation, it's analysis that helps explain with data.

you dont have to click on it.

 

[Thebacklash]

When i stopped by my local GS store yesterday for Pro Day, the employees told me that Corporate sent out a email to all the stores about the GCU ending at BB. Curious to see if GS try's to use this to there advantage.

By raising prices, opening games to be sold as "new", putting "used" stickers over the "new" sticker and raising the price of the "used" game, and laughing at the customers in store.

Wait... they already do that.

 

[thesuzukimethod]

Well said. People need to wake up in this internet era. Be more click-disciplined.

To be honest, yes. GCU cancellation is likely directly related to the sales of video game accessories and peripherals. BB has been selling games to GCU members for about four years at more or less a break-even point for no profit. Having worked at BB long ago, and knowing how they think, I'm sure they looked over their gaming accessory %s over these last few years and decided this discount in games wasn't resulting in more margin and revenue from accessories being sold.

Lol no - did you read the article?

I'm no fan of newsweek one way or the other, but it is an article with a thesis and data to support that thesis. it reports on speculation about why the program ended, but it connects that speculation to other empirically observed facts.

how about using critical thinking skills rather than just piling on to an idea?

 

[Jodou]

everyone seems to think gcu is going to be replaced by something else, and i just dont see why anyone would think that, especially with no clear end date for existing memberships.

A few people have been told that on 6/1 they will be rolling out something new, but of course it could be misinformation. My only guess is that our benefits will be changing to continue building brand loyalty and they will re-launch GCU in some form with everyone on the same page. By killing the program, I wouldn't expect to continue getting 20% off because that does create a divide among loyalists due to sheer luck of when you signed up.

There's a ton of metrics and moving parts at work when it comes to the discounts and people seem to be focused on cost analysis. BB understands the margins far more than anyone here, so speculation and comparison costs are pretty pointless when determining factors that killed the program. The fact of the matter is they look at store traffic, market share or volume of sales across retailers (because they can negotiate better deals with publishers/manufacturers), and attachment rates as just a few metrics. They're not looking at how close the margins are on each game sold, they want to know if they're building an empire of brand loyalists that will keep revenue flowing for the next 10-20 years. Key to a successful business is repeat customers, something nobody here has mentioned.

To the customers they lose over this, you weren't the customer they were targeting anyway. People will be loyal to the brand they trust and have good standing with. Jumping ship just means like most people, you're a fair weather fan.

 

[bee01]

People that think the program is getting replaced with something comparable or that BB is going to have amazing sales now are delusional.

 

[tyrok]

To be fair, other than GCU ending, all these forum pages are speculation. It's likely the margins for Best Buy weren't huge, but until someone posts a contract that Best Buy had for buying games it's speculation that they lost money with GCU. I mean I'm glad some unnamed person had access to distributor pricing for some unnamed company and they claim that makes them an expert. But Best Buy likely has better rates and a few percentage points difference can make a world of difference between a profit and loss.

I frequently receive games at my store any you can see the cost right on the order. All $60 new releases cost between $45.50-$47 depending on the publisher and a flat $48 for Nintendo published Switch games. So yes there is a wee bit of profit in there but only if you pickup in store. But as soon as they have to ship any of those for online orders it's basically a wash. This is exactly why they started doing the $1 pickup discount.

There was some speculation earlier in the thread that the employee discount is worse than GCU and that is right. A new $60 game is usually $50-51 for us (aka 5% above cost) and that doesn't adjust when a game goes on sale. The cost is only updated when there is an official price drop. Just about the only things that had a better price with the discount were amiibo and stuff like the Farpoint bundle which are more "accessories" then software.

 

[chaosbob86]

I remember way before GCU was a thing, best buy would offer $20 reward zone certificates for pre orders on a lot of games. If they brought that back i wouldnt be too pissed about my GCU ending next week

 

[Uncle Anwar]

[attachment=30230:559F7009-75FE-4528-9E9F-3618C827E562.jpeg]

This is like 98% of the people posting on this thread.
I’m sure they will miss your once a month purchase that they made zero profit on...

 

[confoosious]

Gamestop is a public company which has financials available. They primarily sell video game hardware and software. Their Gross margin in 2017 was 33%. For reference, in 2016 it was 35%. In their initial section to shareholders they mention increases in video game hardware and software sales and don't mention accessory sales. Depends on what you believe, but it's my guess that video game software margins are higher than video game hardware margins, thus for the 33% to hold true for Gamestop, software margins would have to be higher than 33%.

The problem with the articles you post is they never really get to how they estimated the video game cost. Reality is big companies like Best Buy get favorable terms and other potential rebate programs that aren't disclosed. And they will never be disclosed because usually it's illegal to release those terms because the seller doesn't want everyone showing up to their door saying so and so gets it for this so give it to me for this. It's kind of like the BOM that get released on Apple products. Those get generally accepted as costs for those products, but according to Apple's CEO they are wildly inaccurate. But then again, he's not legally allowed to correct those reports because his pricing contracts are proprietary.

USED games have higher margins.

 

[Miami Flash15]

I guess that might've explained them basically killing their trade-in program. Or maybe two independent things.

 

[bokiloki]

Sony should offer a 20% of for new game pre-orders, included with PS Plus. That would help them out a lot and people would buy less from Amazon. I would go all digital at that point.

 

[confoosious]

I frequently receive games at my store any you can see the cost right on the order. All $60 new releases cost between $45.50-$47 depending on the publisher and a flat $48 for Nintendo published Switch games. So yes there is a wee bit of profit in there but only if you pickup in store. But as soon as they have to ship any of those for online orders it's basically a wash. This is exactly why they started doing the $1 pickup discount.

There was some speculation earlier in the thread that the employee discount is worse than GCU and that is right. A new $60 game is usually $50-51 for us (aka 5% above cost) and that doesn't adjust when a game goes on sale. The cost is only updated when there is an official price drop. Just about the only things that had a better price with the discount were amiibo and stuff like the Farpoint bundle which are more "accessories" then software.

This should end the debate. But I get the feeling the diehards won’t quit.

 

[coolduck]

Sony should offer a 20% of for new game pre-orders, included with PS Plus. That would help them out a lot and people would buy less from Amazon. I would go all digital at that point.

that would be nice, but seeing as how theyre the only resource for digital games on their platform i dont think thats likely.

 

[Sporkis]

Hell go away for a few days and it hits the fan.  I wish I could say this coming was a surprise but I really can't.  The past 7 months or so their has been a sharp decline in the quality of their service.  Pre-orders being delayed past release date, extra bonuses not being delivered, damaged shipments, everything been on a fast rise.  Obviously something has changed at the top and as they say shit rolls down hill.  Since I just renewed I'm good til 2020 but like most on here I doubt they'll let it run out that long.

Regardless of the profit margin debate going on here.  I will say this in one regard GCU did what it was suppose to, it got me to buy more from Best Buy.  It got me to buy other stuff besides games.  It got me to a physical store on a whim with no real plans to buy anything, but still ended up walking out with something.  With GCU Best Buy got like 90% of my business.  Without it they'll be lucky to get 5%. 

So will I boycott Best Buy over this probably not, I'm a consumer if their is a deal to be found it will attract me.  Hell I absolutely loath Gamestop and usually won't even consider giving them my business, but every once in a century when the stars align they having something going on that is able to nab a single lone purchase from me.  Now granted I feel dirty & disgusted in doing so and hope to god I never have to do it again, they still are able to pull me back in if only ever so briefly now and again.  So if your screaming boycott and think it's going to have a affect, I think your kidding yourself.  I do however think Best Buy will see a shit ton of business drop off for them over this.

Also to those who think publishers are doing cartwheels over this, yeah they probably are because they can only see the short term in everything.  But consider this, thanks to GCU I pre-ordered and bought more a lot more releases at launch, at least 1 a month if not more.  Without it I might buy one or two a year as I can simply wait til a game is half off or more 6 months later.  Honestly can anyone on here with their massive backlogs honestly say without GCU they'll still buy as many games on release day as they've been doing?  I doubt it.  We all know how much stock publishers put into pre-order numbers and those first few weeks of sale.  Well that market will become even slimmer for them now.

 

[shaner25]

Sony should offer a 20% of for new game pre-orders, included with PS Plus. That would help them out a lot and people would buy less from Amazon. I would go all digital at that point.

I might be a cheapskate, but I would never buy a digital game for $48 if I can get the physical game for $60. After playing a physical game, I can normally sell it for at least $30 (sometimes $40). That means the physical game only cost me $20-$30 to play. You can't do that with a digital game.

 

[Thebacklash]

I might be a cheapskate, but I would never buy a digital game for $48 if I can get the physical game for $60. After playing a physical game, I can normally sell it for at least $30 (sometimes $40). That means the physical game only cost me $20-$30 to play. You can't do that with a digital game.

Biggest reason I buy physical instead of digital.

$60 for The Order was a worthwhile cost right?

 

[bokiloki]

I might be a cheapskate, but I would never buy a digital game for $48 if I can get the physical game for $60. After playing a physical game, I can normally sell it for at least $30 (sometimes $40). That means the physical game only cost me $20-$30 to play. You can't do that with a digital game.

Yeah very true, From my standpoint I stopped selling my games long ago, so going all digital for me would help save storage space. But yes there are lots of people who sell their old games to purchase new ones.

 

[rhetoric]

I might be a cheapskate, but I would never buy a digital game for $48 if I can get the physical game for $60. After playing a physical game, I can normally sell it for at least $30 (sometimes $40). That means the physical game only cost me $20-$30 to play. You can't do that with a digital game.

Pretty much this as to why I, too, choose physical over digital. There is always some residual value left on a tangible asset that is absent with digital copies. That is, until blockchain is applied to digital games, allowing us to resell.

 

[FullmetalPain22]

This gives everyone a chance to go through our backlogs, I wonder how GS will respond.

 

[joshnickerson]

Don’t worry though, I have faith that Best Buy will either let you ride out the rest of your membership or make good on it. I bought the first HD-DVD player from Best Buy when it was released. Years later when blu ray won and HD-DVD was discontinued, Best Buy sent me a $50 gift card as an apology/compensation. They didn’t even have to do that, it wasn’t their fault. I’m sure they’ll handle the discontinuation of GCU in a way that doesn’t push customers away.

A few years back, I pre-ordered a special edition of Majora's Mask that came with a free Skull Kid figure the day it was announced. A couple of days before the release date, I got a message that due to shortages, my order had been cancelled and my card refunded. Annoying, but whatever, s**t happens, and I moved on with my day.

The next day, I got a message saying that only was the message I got was a mistake and my order was not cancelled, they were sending it to me for free to make up for any inconvenience. It appeared on my doorstep the next day. Because of that, even after GCU ends, I'll still buy games from BB (that, and because I f****** hate Amazon).

 

[Chuck Stank]

I’m selling my GCU account. Bids starting at $1500!

 

[humbug43]

I’m selling my GCU account. Bids starting at $15.00!

I think you ment 15.00 lol

 

[Nothing-]

It's not speculation, it's analysis that helps explain with data.

you dont have to click on it.

actually no, it's clickbait news that is nothing but editorial, not unlike anything else that has been posted in this thread. It has no informing facts whatsoever outside of stating that the program has been cancelled. In fact, it gets several things WRONG.

The first ing sentence is incorrect. People are still getting their 20% discount if they have a current membership. Then it proceeds to restate the memo that we all had in the first place, in the very first post in this thread. Then the rest of the article is bullshit speculation. "...the program struggled to gain traction after game pre-order savings were also offered through competitive services like Amazon Prime." What the ? According to who? This is opinion masquerading as fact. Best Buy set the standard for 20% off new games actually. People actively CHOOSE to shop at Best Buy, especially the educated ones. Then the "article" goes on to speculate that Amazon's vg stock issues are based upon publishers' irritation with Amazon's discounts, as if they have any indication that this is the truth. Right after suggesting that Amazon is setting the standard for new game sales. Continuing on, "While neither Best Buy nor Amazon have openly discussed their struggles to effectively offer deals on new games," What the does that even mean? When did this ever happen?? They have pioneered deals on new games actually. So what the are you referring to?? Then finally it refers to its own speculation. Because that's all it is. There is no data.

The fact that people these days can't separate factual news from opinion is alarming. That if they read something from a site they have heard of before then it is to be taken as the truth, even when no facts or sources are cited. Current English and composition teachers must be failing in the internet era and old ones are rolling over in their graves.

 

[Chuck Stank]

I think you ment 15.00 lol

Why would I start that low? I’ll end up close to $3500 when the bidding war ends.

 

[lionheart059]

Why would I start that low? I’ll end up close to $3500 when the bidding war ends.

I'll give you a biscuit and an unenthusiastic handy. If it goes til 2024, I'll even make eye contact.

 

[Sporkis]

I'll give you a biscuit and an unenthusiastic handy. If it goes til 2024, I'll even make eye contact.

 

[Jawwaad1]

Lmfao. Dudes saying they aren’t going to shop at BB anymore. I highly doubt it. This is Cheap Ass Gamer. Dudes are going to go wherever the cheapest deal is. So if BB has a deal on a game they want that is cheaper than their competitors, they’re going to buy it. GCU was great but everyone must have knew that BB was most likely losing money from it. I mean, along with 20% off new games plus with some, a $10 reward certificate, then it was 20% off games that were on sale. Just for instance, today they have Deadpool PS4/Xbox One on sale for $14.99. That’s $11.99 after GCU and many get free shipping. Even though Deadpool is a older game, I believe they are losing money. I’ll miss GCU, but BB has made my backlog soooooo big, my wallet is kinda happy it’s gone.

 

[EarthKing]

That's sux. Mine doesn't end until next year. 

 

[malfcn]

Will gcu stack with bfriday this year?

 

[RabbiHick]

The fact that Red Dead is currently unavailable on both Best buy and Amazon makes me wonder if Rockstar/Take 2 is somehow involved, since of course they are about to sell a bajillion copies. Pure spec of course, just strikes me as odd.

 

[humbug43]

Why would I start that low? I’ll end up close to $3500 when the bidding war ends.

Bidding war lol

 

[josekortez]

This gives everyone a chance to go through our backlogs, I wonder how GS will respond.

Amen. Yesterday, I found 18 used PS3 and 360 games that I had purchased from Best Buy when they were clearancing them out a year or so ago. That was the last thing that I had purchased from Best Buy, and I had forgotten about them, but I'll be getting to them momentarily.

 

[starscream615]

Just in case folks don’t know but 20% off is selling at cost give or take a % or two. I’ve been privy to the financials of a large retailer and can tell you definitively.

 

[lionheart059]

Just in case folks don’t know but 20% off is selling at cost give or take a % or two. I’ve been privy to the financials of a large retailer and can tell you definitively.

After much back and forth, I think we drove that point home when someone tried to use Gamestop's published financials to argue it. The published financials actually supported the argument of "This is basically a no profit sale for BB"

 

[Jake-McCall]

How long until someone blames new subscribers for ruining the value and ultimately killing it.

I blame ALL of the RESELLERS (new and old) who have been abusing this program. Yes, I'm aware many of them frequent this site. ;-)

I guess it was just too much work for Best Buy from tracking down individual violators purchasing more than 3 copies per title per year, banning them... only to see them start up again with a different account to abuse the program again and again. I mean, really people... what did you expect?

 

[YTRyanSullins]

I let my GCU lapse over a year ago as I moved to digital with my PC. I rarely buy items when I went there and mainly only buy movies a MCU at a higher discount (movies club unlocked) would be more preferable for me but seeing as BB is shrinking game and movie inventory and upping applicaces and other items with higher margins I don't see this or even a GCU replacement happening.

Oh well it was good while it lasted.

Oh also I'm weird and never sell my games so a $60 game is $60 therefore a digital game highly reduced in price is a good deal and a physical game at 20% off it a good deal. ( Still got my NES , N64, game cube, PlayStation games and consoles and they still work )

 

[waterdrew]

Heh, i guess we gotta PLAY these games at some point huh.

 

[dennisb407]

Holy shit the lurkers came out in droves for this thread

 

[Richard B. Riddick]

Glad I renewed my GCU last december so it will last until december 2019. But after day it will day 

Well it was good when it lasted.

 

[TooPoor]

[...] But after day it will day

 

[Nutty Buddy]

Amen. Yesterday, I found 18 used PS3 and 360 games that I had purchased from Best Buy when they were clearancing them out a year or so ago. That was the last thing that I had purchased from Best Buy, and I had forgotten about them, but I'll be getting to them momentarily.

I have a backlog that goes back to the Circuit City buy 2 get 1 free on clearance games where they made the highest priced game the free game. Those were the days.I'm probably at a 300 game backlog. All still in their shrink.

 

[jsb2642]

At this point, I'm just curious if they ever made money off me, cause I've spent plenty. I live an hour from the closest store, so almost everything I've bought from them has had to be shipped. Aside from must have birthday and Christmas presents, I rarely pay more than $20 for any game before my discount. That being said, GCU changed my shopping habits and have bought everything I could from them for the points and to get elite, which I've had 3 out of the last 4 years. Once my GCU and elite status expires, so will the shopping habits. I just hope we have something better than redbox and ymmv clearance deals once the smoke clears cause after over a decade using this site, the best deals seem to be behind us and it's getting hard to consider myself a cheapassgamer.

 

[Madzane]

I feel that GCU never hit with the mass market. I’ve singed its praises to a many a deaf ear, I’ve offered to pick up games for people only to be greeted with stares like a $48 new release is witchcraft.

It was a great program, I mainly bought 3DS and Vita titles so I guess it’s fine with those systems in their twilight.

 

[kube00]

Lmfao. Dudes saying they aren’t going to shop at BB anymore. I highly doubt it. This is Cheap Ass Gamer. Dudes are going to go wherever the cheapest deal is. So if BB has a deal on a game they want that is cheaper than their competitors, they’re going to buy it. GCU was great but everyone must have knew that BB was most likely losing money from it. I mean, along with 20% off new games plus with some, a $10 reward certificate, then it was 20% off games that were on sale. Just for instance, today they have Deadpool PS4/Xbox One on sale for $14.99. That’s $11.99 after GCU and many get free shipping. Even though Deadpool is a older game, I believe they are losing money. I’ll miss GCU, but BB has made my backlog soooooo big, my wallet is kinda happy it’s gone.

Well looks like I need to buy Deadpool got a $10 reward cert to burn

 

[Uncle Anwar]

My favorite part of this whole story is how so many people here seem to be convinced that their continued ‘business’ matters to a corporation . CAG’s are an extremely small population compared to the entire customer base of best buy. They don’t need your occasional discounted purchase to survive. They already got your money for the things you bought, you can’t return them for a refund and no matter how big of a hysterical tantrum you throw, GCU is done .

 

[ck0]

actually no, it's clickbait news that is nothing but editorial, not unlike anything else that has been posted in this thread. It has no informing facts whatsoever outside of stating that the program has been cancelled. In fact, it gets several things WRONG.

The fact that people these days can't separate factual news from opinion is alarming.

Well stated. The article tried to make assumptions that publishers were behind all of this, and yet cited nothing as proof. Pure speculation.

I'm all for consumer advocacy and consumer options, but we cannot have honest discussions when conspiracy theories enter the conversation.

 

[ChrisD0811]

My favorite part of this whole story is how so many people here seem to be convinced that their continued ‘business’ matters to a corporation . CAG’s are an extremely small population compared to the entire customer base of best buy. They don’t need your occasional discounted purchase to survive. They already got your money for the things you bought, you can’t return them for a refund and no matter how big of a hysterical tantrum you throw, GCU is done .

While I do agree with the overall sentiment of "Oh well, it's fine, move along..." I have to disagree that our purchases don't matter. I absolutely love best buy. Its one of my favorite brick and mortar stores. I make tons of purchases, including my recent LG OLED 65" TV, my washer dryer, two or three 4k movies a month, the odd CD, my wife's new Surface laptop, etc etc etc. Even with all that said, I think the writing is on the wall for the chain. The stores near me are emptier than ever, the customer service has truly declined in the last year or two, and I just generally feel like they are grasping at straws to remain relevant.

The days of folks paying for overpriced warranties and geek squad plans and 100 dollar hdmi cables are behind us, and I genuinely think they have no idea what the hell they are doing. Just my 2 cents. I'm not gonna boycott. I'll still buy from them. But like many have said, my habits after July 10th of this year (my expiration date) will simply revert back to waiting for the 30 to 40 dollar price point like I did pre-GCU. Ultimately I think this move might hurt developers, which makes me sad for the industry really.

 

[blackwaltz34]

The fact that Red Dead is currently unavailable on both Best buy and Amazon makes me wonder if Rockstar/Take 2 is somehow involved, since of course they are about to sell a bajillion copies. Pure spec of course, just strikes me as odd.

I can buy this conspiracy theory since I'm bitter that my GCU ends two days before RDR2 comes out. I normally hold off buying PS4 games until a sale but I was going to make an exception for RDR2 so I can see what all the hubbub is about.

 

[arsenalcrazy8]

hmmm I think Amazon may have cancelled their 20% off preorders too now.

I just checked a bunch of games I preordered with the 20% off, and if you order them now, they no longer get the 20%...

edit: nvm, I see Tomb Raider, for example still has it listed.

 

[CAiNiACprime]

I can buy this conspiracy theory since I'm bitter that my GCU ends two days before RDR2 comes out. I normally hold off buying PS4 games until a sale but I was going to make an exception for RDR2 so I can see what all the hubbub is about.

So.. preorder?