How Do You Stay Entertained In A Recession? Used Video Games.

Video games are up, and books are down. GameStop says sales of used games jumped 32%, as the retailer posted a 13% rise in fiscal first-quarter earnings. Why is GameStop doing so well while other retailers suffer? Its used video game program has excellent profit margins.

From the WSJ:

New-game software sales slid 2.8% while new hardware sales rose 17%. Sales of used games jumped 32%.

The company has benefited from a virtual monopoly in the used-games market. But it is now facing competition from Amazon.com Inc., which launched a service allowing customers to trade in games for store credit.

GameStop, which is based in Grapevine, Texas, opened 114 new stores during the quarter. In February, it said it planned to open more than 400 stores this year

Meanwhile, investors are actually happy that Barnes & Noble didn’t lose as much money as they thought they might. Guess they should start selling used books, huh?

Barnes & Noble Exceeds Estimates, Boosts Forecast (Update2) [Bloomberg]
GameStop Posts Higher Net, but Warns of Slowdown [WSJ]
(Photo:cmorran123)

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  1. Coles_Law says:

    Just don’t buy from Craigslist…

  2. WelcomeToMyWorld says:

    Not too long ago, EBay was a great place to buy used video games. Not any more though. :-(

  3. Fatty Shcock says:

    I am a gamer indeed, and I understand the concept of escapism. I also understand that the unemployed play video games for relief, and to “escape” from the real world for a short time. But, it’s also the fact that for some, not only can this turn into an addiction, but it just continuously makes them procrastinate more and more when they should be looking for a new job.

    I know that there are various factors, such as hiring freezes, not hiring at all, and the continuous use of the “shitty economy” card, that can prevent them from looking for work. But, if I were in their shoes, I would be working my ass off to look for a job, gain more experience any way possible, update my resume for preparation, or if it comes down to it, go back to school.

    Gaming is fun and enjoyable, and it helps to forget about things, but it’s more important to take care of your situation, and your life, before anything else.

    • peacemongermom says:

      @xAnarChisTx: I think the concept that gaming is keeping people from working hard at finding a job is a little off here. As is the concept that if you don’t find a job, you aren’t looking hard enough.

      The job market is much worse than what the news and talking heads are reporting. My husband is in IT and lost his job in October. He has been looking, nonstop, for a job since then, and the only thing he has found was temp work at a big box store over the holidays. He has a highly marketable skill set, but no one wants to pay what it’s worth – there are job listings which equate to the last job he held full time, plus a requirement that the respondent be multi-lingual (not bi-lingual, but multi) and the pay is $8/hour.

      And trust me, we would be pleased as punch to get that $8/hour, too.

      So when a gamer takes a break after sending out anywhere from 12-20 applications in a day (the average my husband sends out daily), and spends a bit of time with his wife, playing GTA4, I don’t think it’s the gaming that’s keeping him from finding a job.

      • Dyscord says:

        @peacemongermom: I agree. Just because you haven’t found a job doesn’t mean you aren’t looking. After I lost my job I’ve been putting applications in anyhwere I can, but haven’t gotten anything back. That’s just how the job market is in some places. Doesn’t mean that I’m sitting on my butt all day playing games.

      • Fatty Shcock says:

        @peacemongermom: So then he is part of the many that doesn’t fall into an addiction playing video games. Like I said, some end up doing this, and I know. I have seen this happen to friends, family, and associates who lost their jobs. And I’m not saying all of them, either.

    • Real Cheese Flavor says:

      @xAnarChisTx: My take on this article was not that there are increased numbers of unemployed people playing video games to escape the situation they’re in but rather that more people are realizing that you can get several hours of entertainment (I’ve got some games that I’ve clocked over 80 hours) from a video game that costs about the same as the price of going out to a movie with friends which is only good for three or four.

      • Cyberxion101 says:

        @Real Cheese Flavor: Bingo! That’s how it is with me at least. I’d rather buy that game and be entertained for hours upon hours than spend the same amount going out with family to watch a movie for a couple of hours.

    • trujunglist says:

      @xAnarChisTx:

      I agree. I’m seeing this a lot more now. Most of the time, they just use the excuse “the economy is bad!!!” and leave it at that. A friend of mine is pulling that right now and it’s kind of stupid because he actually had a job but decided to quit because they had reduced some hours. I’d say working some hours and getting paid is better than working no hours and getting nothing, but hey, no one ever listens to me. So, right now, he just sits around all day playing video games. Not even trying to apply for new jobs, because didn’t you know, the economy is bad so there aren’t any jobs at all, why even bother looking? The recession is a great excuse for procrastination and not being a responsible adult.

      @peacemongermom:

      I partially agree with you, but 12-20 applications a day is nothing. I was submitting at least 100 a day when I was unemployed straight out of college. Internet, walk-ins, mail, phone, the works. Job hunting is a full-time job if you actually want to get one.

      • pecan 3.14159265 says:

        @trujunglist: When did you get out of college? When I got out, two years ago, no one was taking phone calls, and if called when the job listing said not to…well, that doesn’t look too good on you, does it? And walk-ins aren’t acceptable in my field.

        So it’s possible that you were able to submit 100+ resumes in your field, and that was good. But if peacemongermom’s husband submits only 20, that means he’s not making an effort? Maybe in his field, 20 is pretty good, and there are things that he can’t do, like call prospective employers and bug them about a job listing. Job hunting is a full-time job, but 20 is pretty good (my best days were about 20 resumes), and as I said, it depends on the avenues you can take. I would never try to walk into the Washington Post building to inquire about employment, that’s a no no. Maybe you think you can walk in a place, and call them up, but in some industries you can’t do that.

  4. HIV 2 Elway says:

    How to stay entertained on the cheap recession or not? Cheap piano or keyboard.

  5. trrwilson says:

    I wonder how much sales of modding equipment or services have gone up. I have a friend who mods 360s, he’s gone from 1 request a week to almost 1 a day.

  6. Chadams28 says:

    Sometimes eBay’s sellers have better prices on games (many that aren’t used), sometimes GameStop does. GameStop isn’t a great place to sell used games (because they’re often looking for anything other than what you’re selling), but I’m pretty sure that they have policies in place that make sure you don’t end up buying unusable games.

    Also, the B&N I used to work at has a used book section but they don’t buy books anymore. I think they tried it but got too much crap that they couldn’t get rid of.

    • trujunglist says:

      @Chadams28:

      The only policy in place to make sure you don’t end up buying unusable games is that you can return the game within a week or so. They do not test games. If you get a bad copy and don’t have your receipt, you’re SOL.
      Selling to Gamestop sucks because they give you well under the going price for even a used copy. It’s not about “what they’re looking for,” but rather, how little will you take for your game? They almost always take your games, even very old probably unsellable games; they just give you nearly nothing for it. Older games can net you a whopping 25 cents if you’re lucky. I was once offered a penny for a game. I told them to go fuck themselves. You’re better off selling on eBay.

      • Anonymous says:

        @trujunglist: Wrong. It’s 7 days for ANY reason. Didn’t like it, too short, yaddayaddayadda. For a defective game, it’s 30 days.

        While it varies from store to store and employee to employee, many of us are strict on scratched discs. Unfortunately, corporate will send us discs from other stores or warehouses, and we can’t send them back and say, “These discs were crap.” No, we have to try and sell them.

        Also, it’s not like the guy on the other side of the register is trying to screw you over. Trade-in values are set by corporate, a.k.a. greedy bastards in suits. In addition, you’re never forced to trade in a game with little value. And if a game is worth less than 85 cents, we can’t defect it out and have to turn it away. So there goes your “they’ll take any game” argument.

  7. MercyEleusis says:

    Now imagine if they didn’t over-inflate video game prices to upwards of $90 for a “special edition” that includes a shammy and a paper map or if they didn’t sell parts of their game and called it “downloadable content.” Then again, if you’re already ripping off the consumer successfully in troubled times, why bother?

    • johnva says:

      @MercyEleusis: Video games, for the most part, are still a fantastic value for the hours of entertainment per dollar you get out of them. Much cheaper than say, going to the movies, buying a DVD, or going out for a fancy meal. Of course, those things have value to, but I don’t think it’s really fair to call games all that overpriced IF you stick to good and original games (as opposed to the latest sports game rehash with minor tweaks). Especially given the amount of engineering, art, and design effort that goes into making them these days.

      Also, I don’t think I’ve EVER payed $90 for a game. But then again, I also don’t care about paying for the latest and greatest games. I just wait a year or two and they usually discount them. Also, longevity of being commonly sold is a great way to tell which games will be good.

      • lotussix says:

        @johnva: i buy the latest sports games every year.

        i think about it this way. madden 10 will be $60. i will probably play over 100 online games, plus at least 50 head to head matchups. if i only played 150 games, that comes out to be about 0.40 cents a game and each game lasts about an hour. if i went to dave & buster’s and played the arcade version of madden (which sucks) i would spend way more than that (prolly about $4-5 per person) and a full game lasts about 20 minutes. i’d rather play .40/hr at home on a nice tv. than $10-$15/hr on a crappy monitor.

        cheap, interactive entertainment no matter how you slice it.

        i wish i could say the same for all my games, but if i don’t like them… like “Army of Two” for example, i’ll just sell it on ebay.

      • MercyEleusis says:

        @johnva: That’s the trouble with consumers trying to put a price on a creative medium–you can’t have a market-set price agreed upon everyone. Food, clothing, other necessities…they have a set price based on production costs. Some games are under development for three or four years with a team of 100 people and provide about six or seven hours of entertainment–other games are under development for a year of 10 people and provide hundreds of hours of entertainment. And what’s the difference between them in pricing? Nothing. $50 used to be the standard for most new video games, but $60 now seems to be the new set in common price for the “big” titles.

        Take into consideration the franchise The Sims. The Sims 2 had how many expansions? Had how many “item packs”? Either way, if you paid for it when it all came out first, you’re looking at over $200. Now consider The Sims 3. All of that neat content that was together in The Sims 2 + all expansions is not going to be there in The Sims 3. A lot of it will be missing. It will be back for expansions for their games. The only trouble is that you can get the equivalent of all such content for free from a modding community. Bethesda’s games are a great example of that. In truth when you buy a Bethesda game you’re spending $50 just so you can use free mods.

        Point is it’s far from “cheap” entertainment.

        • johnva says:

          @MercyEleusis: I just don’t agree. I think it’s very cheap entertainment when you factor in how many hours you get out of the typical game and compare it to other things people spend entertainment dollars on. The ONLY difference is that it’s a bigger upfront cost.

          And no one ever said that pricing was based on how much effort went into making a game. It’s based on what people will pay.

    • Dyscord says:

      @MercyEleusis: Special editions are there for people who have the money to pay for them. If they feel the extra’s are worth the extra money then they buy it. No different than some DVD sets.

      And DLC is usually additional content on top of a completed game. I say usually because there are times where the content isn’t worth the money. But then, if you don’t want it, don’t buy it.

      Otherwise, like Johnva says above, games are a great value for the money. Recently I bought Crisis Core for the PSP used for 7.50 and have been enjoying the hell out of it. That’s why the used game market is so lucrative. Most people I know buy used instead of new.

      • Scuba Steve says:

        @Dyscord: I’m pretty sure my copy of Marvel vs Capcom 2 was a horrible value for money.. 80 frecking dollars …sigh.

        • Cyberxion101 says:

          @Scuba Steve: Especially seeing as they’re releasing it for the PSN and Live Arcade soon. Not that you’d have been able to anticipate that when you bought it, but I’m betting that its value is going to dip substantially as soon as it hits.

          That’s exactly why I stay away from the speculative aftermarket. I don’t wanna spend big bucks on a game only to see it rereleased in some form that renders my investment worthless.

          Then again, I’ve never been into collecting just for the sake of it. My buddy is excited because he got a Neo Geo used on the cheap, but he’s going to find buying games for it to be an expensive endevor indeed.

      • Con Seannery's Snuggie Lint says:

        @Dyscord: When I break open the wallet and buy a game, I NEVER, EVER buy used. If I want to get a game and not support the developer at all, I’ll just pirate it.

  8. floraposte says:

    Library use is up, too. So it sounds like people are finding other ways than buying new on gaming and reading.

  9. Outrun1986 says:

    Ebay is still a good place to buy used video games if you are careful about who you buy from but often times Amazon or Newegg or another online retailer beat GS’s prices by quite a bit, so you have to keep your options open. You can often get a new and sealed copy of whatever game you want for less than GS is charging for the used copy and you won’t have to spend 15$ a year for their discount card either.

  10. kenbennedy says:

    I like to buy a lot of merchandise used/refurbished, including video games. Amazon has decent used game prices too, but you have to include shipping, since it is charged by item when they are not sold by amazon.

  11. Preyfar says:

    The sad part is the more used video game sales go up… the less developers get back to develop new games. If people need games for cheap they should use Gamefly -vs- buying used. It’s cheaper all around.

    • milqtost says:

      @Preyfar: How is renting someone else’s copy better for the developer than buying someone else’s copy? Both result in the same net sale for the developers.

    • pop top says:

      @Preyfar: Gamefly has terrible return times, so you never really get your money’s worth. Buying used is usually much cheaper, plus there’s gameswap.com that works like the other swap sites.

      There’s no reason for games to cost as much as they do, and I like to vote with my dollar to show the video game companies that they need to research how to lower their prices. I’ll start buying new again when I don’t have to pay $60 for 7 or 8 hours worth of gameplay.

    • Cyberxion101 says:

      @Preyfar: People don’t seem to factor in that in order for a game to show up at Gamestop used, someone had to have bought it in the first place. Developers aren’t being screwed as badly as some folks believe that they are.

      • p-diddy says:

        @Cyberxion101: BS. People will buy a game, play it and then sell it to gamestop within the first week of release (or worse, rip it and return it for a full refund). When gamestop sells that used game at $5 cheaper the same week, i.e., within the first week of release, people buy the cheaper used one (all money to Gamestop) and don’t buy the new one (some money to developer). Thus Gamestop actually is defeating a sale of a brand new game and money that would have gone to the developer, isn’t.

    • trujunglist says:

      @Preyfar:

      Not really. What happened for me is that I found that I wanted to keep the good games I eventually received and more or less immediately sent back the bad ones in order to optimize the process. That means if I ended up wanting the game, I just paid the rental price from gamefly + whatever the price of the game is on top of that. Often times I would end up just getting a crappy game that I didn’t really want due to their queue system so I’d play around with it and then send it back the next day. That’s basically just a big waste of money.
      I guess if you never want to buy games and have plenty of time to get through them it’s a great model. The obvious reason that Netflix works is that it’s possible to watch 3 movies in 1 night if you want. Gamefly’s model doesn’t work because you can’t usually beat a game in a night or even a few days if you fully dedicate yourself to it. If you work and do other things, you’ll basically end up holding onto the game for a month and paying the rental fees that would’ve been better off just buying the game.

  12. ospreyguy says:

    Vuze… just sayin’

  13. Anonymous says:

    The thing with used Gamestop games is that they are much expensive than the ones you can find online like on half.com

    Also services like Goozex are much cheaper alternatives than Gamestop. It takes a bit of a time to get the desired game though but it’s much better than shelling money out on Gamestop.

    I don’t understand any othe reason, besides instant gratification, where people use Gamestop to buy used games.

  14. trrwilson says:

    You know, I pirate a lot of things (shame on me, I know), but console piracy is a colossal pain in the ass, and PC piracy is a big bundle of fail if you want to play online.

    • Stephen Schenck says:

      @trrwilson:

      Not if you love soldering. And one could make a strong argument that playing games online in the first place is a bundle of fail.

  15. turkeyspam says:

    Sweet! 114 new stores to fuck you over!

  16. redkamel says:

    download “Braid”. 15 bucks for PC, Mac or Xbox. Ive been up to 130 playing it all week.