GameStop 2012 Annual Report Download - page 20

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Business and Growth Strategy
Our goal is to continue to be the world’s largest multichannel retailer of new and pre-owned video game
products and PC entertainment software and expand our business into the mobile device category to provide the
best video game content to our customers anytime, anywhere and on any device. We plan to strengthen that
position by executing the following strategies:
Increase Market Share and Expand our Market Leadership Position. We plan to increase market share
and awareness of the GameStop brand and drive membership in our loyalty program, expand our sales of new
and pre-owned mobile products and expand our market leadership position by focusing on the launch of new
hardware platforms as well as physical and digital software titles.
•Increase GameStop Brand Awareness and Loyalty Membership. Substantially all of GameStop’s
U.S. and European stores are operated under the GameStop name, with the exception of the Micromania
stores acquired in France. In 2007, GameStop introduced its new brand tagline “Power to the Players”
and in 2010 introduced its U.S. loyalty program called PowerUp Rewards. Building the GameStop brand
has enabled us to leverage brand awareness and to capture advertising and marketing efficiencies. Our
branding strategy is further supported by international loyalty programs and our Web sites. The PowerUp
Rewards loyalty program offers our customers the ability to sign up for a free or paid membership that
offers points earned on purchases which can be redeemed for discounts or merchandise. Through
PowerUp Rewards, our customers have access to unique, video game related rewards unavailable through
any other retailer. The program’s paid membership also includes a subscription to Game Informer
magazine, additional discounts on pre-owned merchandise in our stores and additional credit on trade-ins
of pre-owned products. As of February 2, 2013, we had 22.3 million members in the PowerUp Rewards
program, 7.9 million of which were paid members. In total, our loyalty programs around the world had
approximately 27.5 million members. Our Web sites allow our customers to buy games online, reserve or
pick up merchandise in our stores, order in-store for home delivery and to learn about the latest video
game products and PC entertainment software and their availability in our stores. We intend to increase
customer awareness and brand loyalty. Together, our loyalty programs, Web sites, mobile applications,
magazine and other properties are a part of our multi-channel retail strategy designed to enhance our
relationships with our customers, make it easier for our customers to transact with us and increase brand
loyalty. In the 52 weeks ending February 1, 2014 (“fiscal 2013”), we plan to continue to aggressively
promote our loyalty programs and increase brand awareness over a broader demographic area in order to
promote our unique buying experience in-store for new and pre-owned hardware and software, trade-ins
of pre-owned video game and mobile consumer electronics products and to leverage our Web sites at
www.gamestop.com, www.ebgames.com.au, www.ebgames.co.nz, www.gamestop.ca, www.gamestop.it,
www.gamestop.es, www.gamestop.ie, www.gamestop.de, www.gamestop.co.uk, www.micromania.fr and
www.gameinformer.com, the online video gaming Web site www.kongregate.com, our digital PC
distribution platform available at www.gamestop.com/pcgames, and our online consumer electronics
marketplace available at www.buymytronics.com.
•Increase Sales of Pre-Owned Video Game Products. We believe we are the largest retailer of pre-owned
video game products in the world and carry the broadest selection of pre-owned video game products for
both current and previous generation platforms, giving us a unique advantage in the video game retail
industry. The opportunity to trade in and purchase pre-owned video game products offers our customers a
unique value proposition generally unavailable at most mass merchants, toy stores and consumer
electronics retailers. We obtain most of our pre-owned video game products from trade-ins made in our
stores by our customers. We will continue to expand the selection and availability of pre-owned video
game products in our stores as new products are introduced. Pre-owned video game products generate
significantly higher gross margins than new video game products. Our strategy consists of increasing
consumer awareness of the benefits of trading in and buying pre-owned video game products at our stores
through increased marketing activities and the use of both broad and targeted marketing to our PowerUp
Rewards and international loyalty program members. The supply of trade-ins of video game products and
the demand for resale of these products are affected by overall demand for video game products and the
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