Konami to UK Retailers: Stop the Price War

September 1, 2011 -

Konami Europe's top executive says that publishers are taking a shellacking from retailers in the United Kingdom because of their competitive pricing and constant sales battles and he's had enough. Speaking to MCV, the publisher’s European chief Kunio Neo said that the UK market is suffering, while other territories such as Germany are thriving. He blames the constant sales battles among retailers in the UK and he has a message for them: Stop the price wars.

“UK games pricing is very poor,” said Neo. “Retailers are always reducing prices and the profits for publishers are getting smaller. The UK is really suffering. And he said that Konami is far from the worst-off publisher in this situation.

“We’re based in Germany and despite the economic conditions in many other countries, Germany is doing alright. So we’re not as affected as a US publisher that has a UK office. They’re suffering because they focus their sales on the UK.”

Konami’s European GM of sales, marketing and products, Martin Schneider offered a more succinct message:

"Tell the UK shops to stop the price war."

We wonder if they are actually listening, and we have a pretty good idea of what consumers in the UK think about all the sales..

Source: Konami


Comments

Re: Konami to UK Retailers: Stop the Price War

Hmm, lets investigate a few games that pop up on web pages of the console section of the leading UK high street games retailer... in fact, the ONLY major high street retailer specialising in video games as far as I'm aware.

 

GAME - FIFA12 or MW3, £45.  Dead Island or BF3, £40.

RRP - FIFA12 or MW3, £55.  Dead Island or BF3, £50.

US prices - $59.99, equivalent to £36.99 at current exchange rates.

Maybe the UK retailers are undercutting recommended retail prices, but we're still getting gouged in comparison, so what I'm thinking is, "you dont know what the hell you're drooling about, Konami, you insane morons."

Re: Konami to UK Retailers: Stop the Price War

So he wants to UK to stop selling games at cheaper prices. I take it that he believes that £55 for COD is acceptable then?

Games at £30 are still too expensive, and considering that the UK has to pay more for hardware and software, well he just needs to take a long hard look at those comments.

Re: Konami to UK Retailers: Stop the Price War

£30 can be a substantial amount of money compared to ones budget but £30 for a product that, in some cases, gives you hundreds of hours of entertainment is practically a steal.

Re: Konami to UK Retailers: Stop the Price War

Lol. You know you are full of yourself when you make this statement publicly.

On the other hand, UK, could you teach other countries how to be more competitive?

Re: Konami to UK Retailers: Stop the Price War

Would Mr. Neo prefer price fixing, instead?

Re: Konami to UK Retailers: Stop the Price War

wait a second...wouldn't retail sales come out of the store's cut of the sale? unless Konami's lowering what they sell it to the stores for, how could that have an effect on them?

Re: Konami to UK Retailers: Stop the Price War

So Konami is basically saying "Screw the free market! Sell stuff at the price we want them sold for, not what their market says they should be sold for."

Re: Konami to UK Retailers: Stop the Price War

I wouldn't go that far, but if something doesn't happen soon, there won't be much of a market left.  If something's not profitable, there's no investment. What most people fail to realize is that games are not a labor of love. It's a business. If there's no money to be made, investors take their money elsewhere. If there's no investment, there's no product.

It's the same thing with reserving games at Gamestop or Target. If there's no pre-orders, that tells the publishers there's no interest, so they cut their losses and move on to the next project. One of the big reasons that games are canceled is lack of consumer interest.

Re: Konami to UK Retailers: Stop the Price War

The question is what exactly is supposed to "happen soon"?

Now we don't know what kind of supplier contracts are in place here, but Konami should theoretically be able to refuse to sell their product to retailers below a certain point, setting a price floor for any retailers that want to carry the merchandise and be able to sell it at a profit. However, the effectiveness of that depends on how much the retailers value Konami products versus how much they value the increased business from all of their sales. If the Konami products aren't "must have" big sellers, then they may have their answer why they're having a hard time holding a higher price point.

My question is, where is the problem here that is inhibiting normal correction if prices are truly too low from a market standpoint, rather than just "too low" from what the publishers would like? If the UK market really is doing so bad, the retailers ultimately are going to hit the bottom on slashing prices and still being able to sustain themselves, and the weaker competitors are going to start dropping. One would assume the reduced competition at that point would see prices start to rise again.

It is entirely possible I'm missing something, but I'm not sure where any of this is deviating from normal market dynamics to the point that the whole UK games market could implode.

 
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MaskedPixelantehttp://www.joystiq.com/2014/04/18/playstation-99-cent-sale-discounts-tokyo-jungle-super-stardust/ Weekend long PSN flash sale. So much stuff is 99 cents for the rest of the weekend.04/18/2014 - 5:59pm
Adam802http://www.polygon.com/2014/4/18/5627928/newtown-video-game-addiction-forum04/18/2014 - 4:14pm
Matthew Wilsonit is a video talking about why certain games/products/consoles do well, and others do not. he back it up with solid research.04/18/2014 - 3:56pm
Andrew EisenI'm not keen on blind links. What is it?04/18/2014 - 3:45pm
Matthew Wilsonthis is worth a whatch https://www.youtube.com/watch?v=MyXcr6sDRtw&list=PL35FE5C4B157509C904/18/2014 - 3:43pm
MaskedPixelanteNumber 3: Night Dive was brought to the attention of the public by a massive game recovery, and yet most of their released catalogue consists of games that other people did the hard work of getting re-released.04/17/2014 - 8:46pm
MaskedPixelanteNumber 2: If Humongous Entertainment wanted their stuff on Steam, why didn't they talk to their parent company, which does have a number of games published on Steam?04/17/2014 - 8:45pm
MaskedPixelanteNumber 1: When Night Dive spent the better part of a year teasing the return of true classics, having their big content dump be edutainment is kind of a kick in the stomach.04/17/2014 - 8:44pm
Matthew Wilsonhttp://www.giantbomb.com/articles/jeff-gerstmann-heads-to-new-york-takes-questions/1100-4900/ He talks about the future games press and the games industry. It is worth your time even though it is a bit long, and stay for the QA. There are some good QA04/17/2014 - 5:28pm
IanCErm so they shouldn't sell edutainment at all? Why?04/17/2014 - 4:42pm
MaskedPixelanteNot that linkable, go onto Steam and there's stuff like Pajama Sam on the front-page, courtesy of Night Dive.04/17/2014 - 4:13pm
Andrew EisenOkay, again, please, please, PLEASE get in a habit of linking to whatever you're talking about.04/17/2014 - 4:05pm
MaskedPixelanteAnother round of Night Dive teasing and promising turns out to be stupid edutainment games. Thanks for wasting all our time, guys. See you never.04/17/2014 - 3:44pm
Matthew WilsonAgain the consequences were not only foreseeable, but very likely. anyone who understood supply demand curvs knew that was going to happen. SF has been a econ/trade hub for the last hundred years.04/17/2014 - 2:45pm
Andrew EisenMixedPixelante - Would you like to expand on that?04/17/2014 - 2:43pm
MaskedPixelanteWell, I am officially done with Night Dive Studios. Unless they can bring something worthwhile back, I'm never buying another game from them.04/17/2014 - 2:29pm
PHX Corphttp://www.msnbc.com/ronan-farrow/watch/video-games-continue-to-break-the-mold-229561923638 Ronan Farrow Daily on Video games breaking the mold04/17/2014 - 2:13pm
NeenekoAh yes, because by building something nice they were just asking for people to come push them out. Consequences are protested all the time when other people are implementing them.04/17/2014 - 2:06pm
Matthew Wilsonok than they should not protest when the consequences of that choice occur.04/17/2014 - 1:06pm
NeenekoIf people want tall buildings, plenty of other cities with them. Part of freedom and markets is communities deciding what they do and do not want built in their collective space.04/17/2014 - 12:55pm
 

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