Gamestop Circle of Life Controversy

Postby SolidSnickerdoodle » Thu Feb 09, 2017 10:25 pm

I had some reservations about posting this due to the fact that I've already mentioned my job at GameStop once before, and I don't want to be that guy that complains about his retail job on a bondage forum. You know, cause we all hate that guy. But recent reports and testimonies from GameStop employees have revealed some pretty chilling stuff.

Perhaps some of you have heard of this by now, or if you have friends who shop there you may have heard it from them. Basically, there's a chance that your local GameStop may be lying to you in regards to what they have in stock, or at the very least pushing their customers towards purchases that they don't want, in an effort to meet sales quotas.

For about a decade now GameStop has had this business model known as the Circle of Life. In a nutshell, employees are expected to meet certain quotas in 4 distinct categories. That being Pro memberships, pre-owned sales, pre-orders of new releases, and trade-ins. The idea is that customers will trade in their old games, providing us with our pre-owned inventory, and use their credit to buy new games/reservations. And when they get bored with those games, they bring them back to trade-in. So essentially it's a cycle.

Each category has a percentage goal for total transactions for that week. For example, if the used games quota for your store is 30%, and you made $1000 that week, used game sales must amount to a minimum of $300. Or corporate is going to come breathing down your neck. This was all explained to me when I was first hired on.

Contrary to popular belief, GameStop does not make money on new releases and new consoles. Companies like Sony, Microsoft, and Nintendo barely make any money on hardware themselves. So you know we aren't getting much of a cut. Around 90% of our revenue comes from the sale of pre-owned merchandise. Because if someone trades in merchandise we can buy it for a low cost, turn around, and jack up the price to ensure a high profit margin. This shouldn't come as a surprise to anyone that has been offered $10 for their original model PS4, despite paying $300 at release. So from day one we have been taught to steer customers towards pre-owned. And generally there's nothing wrong with this as the customer is going to save money buying pre-owned merchandise anyway.

However, in the recent years GameStop has become increasingly aggressive with their sales quotas, prompting some employees, as well as store leaders, to take drastic measures to keep their jobs. For example, an employee might lie and tell a customer that they do not have any more new consoles when in fact they do because they don't want to lose $300 to a new purchase, on what could otherwise be a $250 pre-owned purchase. Put it this way. If a customer comes in and buys a brand new PS4, a new game, and a new headset then I have effectively had $400+ siphoned out of my COL score. And most employees don't work enough hours to pick up that kind of slack.

And it's not just employees and managers. Some district managers are actually encouraging the locations under their jurisdiction to engage in this sort of behavior, but not in such a blatant fashion. For example, employees might be told not to educate the customer about current sales on new copies of games. It's rare, but sometimes the customer could in fact save more money buying new instead of pre-owned. But instead of telling them that employees will sometimes remain silent because their store needs the pre-owned sales. Which means it's on the customer to know ahead of time. Or, they might lie about features in an upcoming game in an effort to get the customer hyped and guarantee a pre-order.

Another more subtle tactic involves the 1 year warranty on purchased games. Usually, the employee asks the customer "Would you like to add the 1 year warranty for X dollars?" Now employees have taken the sneaky approach of adding on the warranty by default and saying "Your total with the game warranty is X dollars." So it's essentially on the customer to catch it and request that we take it off. But anyone that isn't half paying attention might not notice. Which is a pretty shitty way to do business when you'r actively trying to dupe you clientele.

So far as I can tell, my location has never engaged in these activities. The only exception being that when a customer asks for a game, we assume they want pre-owned because it's generally going to save them money. And if there's another deal such as a sale that saves them more money we will let them know. My store doesn't have to use these unethical practices because we have an easy enough time meeting our goal. But for every other location it's on a case by case basis.

All this is to say, keep an eye out and do a little independent research. If you're like me and you like video games, you probably shop at GameStop. But you can't always be sure you're getting the best deal or service. Despite what our "guarantee" says.

Also, here's an article detailing over 100 accounts from various GameStop employees, and the shifty tactics they've been told to use at the risk of losing their jobs. Part of me blames them, but part of me doesn't considering how much the company expects from a staff of 4-5 people working roughly 20 hours a week. Welcome to the world of retail I guess.
http://www.kotaku.com.au/2017/02/we-are-all-scared-for-our-jobs-gamestop-employees-talk-about-the-circle-of-life-program/
There is only one God, and his name is Death. And there is only one thing we say to Death: Not today.

Re: Gamestop Circle of Life Controversy

Postby Driverman » Thu Feb 09, 2017 10:56 pm

To be totally honest with you, this sounds like typical corporate business practices, hardly exclusive to Gamestop. I think you can find these sorts of tactics or ones similar to them are employed by essentially every major retail corporation in the US. I have seen much shadier business practices, bait and switches, and other assorted things in my days working for a major retail grocer. Things such as raising prices for 2 months, then returning them to where they always had been and declaring "NEW LOW PRICES!!!!" Putting tags on items that say ".99 CENTS!!!!" on a $2.99 item just to have "Must buy 3 or more" in extremely small print. By the time the customer arrives to check out and has waited in line, they are frustrated and just buy the one.

In short, your company is not doing anything unusual in the corporate world.

Re: Gamestop Circle of Life Controversy

Postby drawscore » Thu Feb 09, 2017 11:33 pm

When I was younger, I was in retail. General sales at J. M. Fields, and Cameras and Jewelry at K-Mart. When I was 16, I ran a trading post at my local council's boy scout camp. Admittedly, it was a long time ago, and I was paid a salary, and was not on commission. I never felt pressure from management, to promote certain items over others, but that was back in the day, when you pulled in to a gas station, one attendant pumped your gas, another checked your tires, and a third cleaned your windshield. And, the road maps were free.

Times have changed.

Drawscore

Re: Gamestop Circle of Life Controversy

Postby Kyle » Sat Feb 11, 2017 9:44 am

I never had a problem with Gamestop pushing used stuff on me, but with them pushing new stuff on me. They always wanted me to preorder games months in advance when I used to shop there (I only go there now if I absolutely have to).

Re: Gamestop Circle of Life Controversy

Postby xtc » Sat Feb 11, 2017 11:04 am

OK. Controversial remark: if you are unhappy bout what your employer expects from you, why not work somewhere else?
I was lucky: as a maths teacher, I had a very "clean" job (even though our National Curriculum tried to exclude logic [boolean algebra], the structure of networks and objects [topology] and other dangerous pursuits). Never mind, I was always indulged when it came to the idea of "enrichment"
Boxer shorts are cool,
but little speedos rule!

More by the same author: viewtopic.php?f=5&t=22729

Re: Gamestop Circle of Life Controversy

Postby Oohmynameisblue » Wed Feb 15, 2017 2:18 pm

All i know about gamestop is they give you about a penny for every pound you spent on something when you trade in (im actually looking more at you cex

Re: Gamestop Circle of Life Controversy

Postby Chris12 » Wed Feb 15, 2017 3:23 pm

This new attitude might have something to do with the rise of digital gaming. Gamers have a preference for physical stuff but that attitude is decreasing and Microsoft already tried to make the Xbone a completely digital device. Eventually digital might become the norm. Gamestop may just be trying to make as much money as they can now before they become obsolete.

The pundit Jim Sterling noted something interesting too. For entities that have a hard time existing without each other at the moment the business of the game industry and gamestop are hostile to one another. Not a penny of a used sale goes to the developers and publishers who made the sold product and as Solid said Gamestop doesn't really get much money because so much of a ''real'' sale is going back to the publisher and the ill fated Xbox experiments shows an eagerness to cut Gamestop out of the process eventually.