GameStop (GME) Squeeze: Proves demand for online “games” strong, not brick and mortar stores.
In the COVID era Americans are spending more time indoors hovering over their laptops, ipads, iphones looking for entertainment. With only so much Netflix (NFLX) content available for binging, consumers are ramping their COD, GTA and other gaming activity. The recent Reddit GME casino hysteria perhaps the most intense form of “online gaming” seen in history.
Using our proprietary email intelligence, we investigated whether there was any evidence of actual demand increases for the stale brick and mortars dinosaur GameStop.
Below our promotional ensemble quantifies exactly how desperate GameStop was in attempting to generate sales surrounding the critical holiday period. Compared with a year ago incentive email offers have risen an astounding 1300%. Also alarming, is our classification has tagged substantially more steep discounts than a year ago. Upon closer inspection these are from increasing coupons such as “up to 50% off games”, “$40 off used games”. Increasing discounts for core product offering bode poorly for demand.
Often times with the focus on online, management teams are shifting sales from in-store to online in an effort to show evolution. However, our promotional data reveals much of this increased e-commerce activity is from pushing out steep , never seen before discounts to their existing customer base.