Amazon.com made some waves, or maybe ruffled some feathers, when it announced that it was going to enter the used video games business. The Video Game Trade In Store allows gamers to mail in old games for credit towards games or other products available through the web retailer. The ruffled feathers came from GameStop, which has been in the used game business for a long time now, having literally gotten it down to a science.
GameStop’s concern is understandable given that almost 50% of their profits come from the sale of used video games, according to their recent shareholders report. But I don’t think they have that much to worry about regarding Amazon just yet.
Because credit received for used games, in the form of a gift card, can be used to buy other things at Amazon, I think they probably see it as a way to increase sales across the board with a younger demographic that tends to have more disposable income. Used games could open the door to the same people who use Netflix and GameFly without a second thought. Either more business from customers who use Amazon regularly already, or new business from those who do not. But Amazon won’t be getting the gamers who want to trade and get new games the same day. Which group is larger remains to be seen, but I know that I generally don’t like to wait.
In tough economic times, customer loyalty is absolutely essential. Gift cards and store credit deals tend to keep people coming back whether online or off. Gamers are still spending money, so gaining their interest is a good move for Amazon whether they buy more games from Amazon or not. One way or another, the gift cards will be used, undoubtedly attracting a few new dollars in the process.