13 Button-Mashing Facts About GameStop

Formerly the property of Barnes & Noble, GameStop struck out on its own in 2004 and has gone on to become a fixture of shopping malls across the world, attracting consumers away from big-box chains by offering trade-ins or cash on used titles. Despite some negative forecasts about the future of physical stores when many consoles now allow users to download games, the company's shares are up 39 percent this year and more than 6700 stores dot the globe. Check out some details on how the company profits, proper etiquette for robberies, and how a former vice-president wound up in a federal courtroom.

1. THEY STARTED OUT SELLING ATARI TITLES.

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In 1983, Texas entrepreneurs James McCurry and Gary Kusin opened a software store named Babbage’s (after 19th century computer pioneer Charles Babbage) in a Dallas shopping mall. While Atari and the video game industry in general was about to suffer a steep decline in interest, Babbage’s was also trafficking in personal computer programs: The diverse inventory allowed them to tread water before Nintendo reinvigorated the industry. In 1994, the company merged with Software Etc. before being acquired by Barnes & Noble in 1999 and changing its name to GameStop. Executive Dan DeMatteo took the name after BookStop, a chain he remembered from the 1980s.

2. THEY DON’T ALWAYS GET ALONG WITH GAME PUBLISHERS.

GameStop’s lifeline is the buying and selling of used game titles. Rather than spend full retail on a new game, buyers can often find a used copy for significantly less. One estimate puts the "used" section as the source of 44 percent of their profits thanks to healthy mark-ups: A $15 trade-in like LEGO Hobbit can be resold for $38. The game developer, naturally, doesn’t see any money from those secondhand sales, which has historically led to friction: Microsoft was once rumored to be working on lockout chips that would prevent games from being resold.

3. THE USED GAMES YOU SELL BACK DON’T STAY IN THE STORE.

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Used titles that are purchased by GameStop don’t get plopped right onto store shelves. Instead, they’re sent to the company’s refurbishment center near its Grapevine, Texas headquarters. The games are “buffed” and inspected to make sure they're still playable before being shipped back out. The facility processes more than 400,000 games every week.

4. EMPLOYEES CAN CHECK OUT GAMES.

GameStop allows staffers to borrow game titles for up to four days. There are a few caveats, though: the game can’t be a new, popular title, and it can’t be the only copy in the store.

5. MICROSOFT’S “RED RING OF DEATH” WAS THEIR GAIN.

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Microsoft’s highly-anticipated release of the Xbox 360 in 2005 was hampered by what gamers called the “Red Ring of Death,” an internal failure on the console’s motherboard that manifested itself months or years after purchase. (The error caused three flashing lights to appear around the power button and prevented gamers from playing their purchases.) In 2009, GameStop figured out a soldering technique that would easily resolve the issue. They bought damaged systems cheap, repaired them, and resold the newly-refurbished systems at a significant mark-up.

6. THEY GOT NABBED FOR “GUTTING” GAMES.

Typically, a manufacturer’s in-box incentives (coupons, freebies) are developed and distributed without requiring input from a retailer. In the case of Square Enix’s 2011 PC release, Deus Ex: Human Revolution, GameStop was irritated the developer had inserted a promotional flyer for OnLive, a cloud gaming service. According to CBS News, GameStop had employees open new copies of the title, retrieve the coupon, and throw it away. Customers were so enraged that the company later offered a $50 gift card to anyone who had pre-ordered the game or purchased it using the store’s rewards program.

7. PEOPLE LIKE TO DIVE INTO THE COMPANY'S TRASH.

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GameStop does such a brisk business with its used inventory—12 million titles passed through its refurbishment center in 2012—that stores often don’t have enough room to carry as many as they have in stock. As a result, the company tends to throw away games and other items that take space away from profitable inventory. Once discarded, titles, accessories, and guidebooks can be retrieved by enterprising gamers willing to paw through the dumpsters. When GameStop caught wind of the practice, they issued a new policy, “Field Destroy,” that calls for employees to damage anything that could be resold by the trash-picking opportunists.

8. A ROBBER ONCE CALLED AHEAD TO MAKE SURE A GAME WAS IN STOCK.

It wasn’t exactly a heist worthy of Danny Ocean, but it was certainly unique: a Nashville, Tennessee thief who stormed a GameStop at gunpoint in January 2014 actually called ahead and asked the clerk to gather an “order” of an Xbox One and several games so he could swing by and pick it up—per his story, he was on his way to work and in a hurry. (Both technically true.) The man then entered wearing a mask and made off with the goods, which the employee had dutifully gotten together near the counter. There were no subsequent reports of the thief being caught.

9. STORES IN PHILLY ONCE REQUIRED SELLERS' FINGERPRINTS.

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According to a CBS affiliate, Philadelphia-area GameStop locations began requiring customers to have their fingerprint scanned if they were selling or trading in a used game: The prints were checked against a database operated by law enforcement that tracked stolen goods. Not surprisingly, customers were slightly offended by the measure. Riding a wave of negative publicity, the Philly-area stores abandoned the policy in August 2014, just a month after it had been enacted.

10. THEY BOUGHT OUT THINKGEEK.

Novelty ice-cube trays are about to become a lot more convenient to purchase. In June, GameStop announced their acquisition of Geeknet, parent company of ThinkGeek, the online resource for plush bacteria and monkey-related business. As part of the arrangement, GameStop plans to open a series of retail ThinkGeek stores. The first location opened in Orlando last month. 

11. A FORMER VICE PRESIDENT DEFRAUDED THEM OUT OF MILLIONS.

The FBI issued a press release in 2012 detailing a large and convoluted scheme by former GameStop vice president of communications Frank Olivera to defraud the company out of millions of dollars. From 2009 to 2011, Olivera billed GameStop using invoices for a fictitious vendor called Cloud Communications. When they paid, Olivera would have the money transferred from the fake business account to his own. He cost GameStop nearly $2 million before being caught; the resulting mail fraud charge netted him four years in prison.

12. DIGITAL GAMING A PROBLEM? IT’S OK. THEY HAVE WHALES.

With investor forecasts consistently predicting bad times ahead as a result of cloud-based and downloadable gaming, GameStop thinks they’ll stay afloat. Speaking with Fast Company in 2013, president Tony Bartel expressed confidence in their “hybrid gamer” consumer base, which he refers to as “whales.” Hybrids, Bartel said, buy both physical and digital copies of games. Thanks to their PowerUp Rewards Pro Card program, the company can track spending habits and recommend games in a way similar to Netflix’s suggestions.  

13. THEY’RE ALSO COUNTING ON RETRO GAMING.

Stuart Conner, Flickr // CC BY-ND 2.0

GameStop is hoping nostalgia will help keep their bottom line intact. In April, the company announced a new trade-in program for classic consoles like the Nintendo Entertainment System, Sega Genesis, and their massive cartridge-based game libraries. It’s expected that all of their stores will be buying and selling retro merchandise by year’s end.

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10 Strange Publicity Stunts by Major Food Brands
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Celebrities have always loved doing crazy things for press—but these days, even corporations will go to extreme lengths to get the word out about their products. Case in point: IHOP's recent attempt to create a little mystery, and sell some burgers, as IHOb. Below you’ll find 10 of the weirdest stunts done to promote mass-produced food items.

1. COLONEL SANDERS RAPPELS DOWN A HIGH-RISE

It’s hard to imagine KFC’s elderly Colonel Sanders doing much outside of eating and talking about his “finger lickin’ good” fried chicken. But in 2011, a man dressed as the Colonel strapped on a harness and rappelled down Chicago’s River Bend building. The Colonel didn't stop at rappelling down the 40-story building; he also handed out $5 everyday meals to window washers. What was KFC’s concept behind this dangerous promotion? They wanted to show the world they were taking lunch to “new heights.”

2. THE WORLD'S LARGEST POPSICLE

Sometimes being the biggest doesn’t mean you’re the best. In 2005, Snapple wanted to make the world’s largest Popsicle to promote their new line of frozen treats. Their plan was to display a 25-foot-tall, 17.5-ton treat of frozen Snapple juice in New York City’s Union Square. However, their plan ended in a sticky disaster. The day Snapple tried to present the Popsicle, New York was experiencing warmer than expected temperatures. The pop melted so quickly that a river of sticky sludge took over several streets. In a city already congested by traffic and tourists, this made Snapple enemy No. 1 that day to the people of New York City.

3. COFFEE CUPS ON CAR ROOFS = FREE COUPONS

A cup of Starbucks coffee
Wikimedia Commons

Starbucks believes in rewarding those who embrace the holiday spirit. In 2005, the Seattle-based coffee giant developed a campaign by which brand ambassadors drove around with replicas of Vente Starbucks cups affixed to their car roofs. If anyone stopped the ambassador to warn them about the coffee cup on their roof, that person received a $5 gift card to Starbucks. Starbucks wanted the world to know being a good samaritan really can pay!

4. MESSAGE IN A BOTTLE

Imagine walking the beach and finding a sealed bottle of Guinness. But instead of finding beer inside, you find a note from King Neptune, the Roman god of the sea. In 1959, that happened to people along North America’s Atlantic coast. Guinness wanted to build brand awareness in the area, so they dropped 150,000 sealed Guinness bottles into the ocean. The bottle contained Neptune’s scroll announcing the House of Guinness’s Bi-Centenary as well as a document instructing the reader on how to make a Guinness bottle into a table lamp. While no one got a free beer (boo!), they did walk away with an arts and crafts project.

5. EAU DE FLAME-BROILED

Who can resist the smell of flame-broiled burgers? The answer is most people—at least when it comes in the form of a body spray. Burger King’s 2008 campaign promoting the “scent of seduction” may be one of the weirdest ideas on this list. The fast-food company thought they could capture the world’s attention by creating and advertising a meat-scented cologne called FLAME by BK. Though select New York City stores actually sold the scent, all of this was a tongue-in-cheek campaign to make the 18- to 35-year-old male demographic laugh.

6. HERE COMES THE SUN

London commuters experienced an unexpectedly bright morning during January 2012. Tropicana worked with the art collective Greyworld to create a fake sun promoting their “Brighter Morning” campaign. The "sun," made up of more than 60,000 light bulbs, rose over Trafalgar Square at 6:51 a.m. on a particularly chilly morning. The sun set at 7:33 p.m. Tropicana continued to promote their sun day, fun day by having Londoners sit under the sun with branded sunglasses, deck chairs, and blankets. 

7. AIRPORT STEAK DELIVERY

Some of the craziest publicity stunts can’t be planned. We live in a world of 24/7 social media, and when the Twitterverse gave Morton’s Steakhouse an opportunity, they seized upon it. Before flying from Tampa to Newark, Peter Shankman, an entrepreneur and author, jokingly tweeted at Morton's Steakhouse that he wanted a porterhouse steak to be waiting for him when he landed. As Shankman was a frequent diner and social media influencer, Morton's Steakhouse saw the opportunity to start a conversation—and they went for it: When Shankman touched down in Newark, he was greeted by his car service driver and a Morton’s deliveryman. If only all travelers could experience that happiness in an airport.

8. BUYING THE LIBERTY BELL

April Fools Day gags can be great for brands … or an embarrassment. In 1996, Taco Bell took out an ad in The New York Times saying they bought Philadelphia's Liberty Bell. The ad also informed people of the bell’s new name: "Taco Liberty Bell." Back in the mid-1990s, people couldn’t go on Twitter or Facebook to find out the truth. Instead, they wrote the publication voicing their outrage. The hoax may have worked in getting press coverage (650 print publications and 400 broadcast media outlets publicized the joke), but what does that say about your brand when people actually believe you would rename a historic monument for your own gain?

9. CREATING THE LARGEST MAN-MADE FIRE


Wikimedia Commons

In 2011, the Costa-Mesa based chain El Pollo Loco sent out press releases saying they planned to create the world’s largest man-made fire. Why would they create a fire? El Pollo Loco needed to get the word out about their new flame-grilled chicken. Spectators attending the event were shocked to see that this stunt was actually a commercial shoot for the brand. The chain says they really did attempt to break the record. But many publications have stated the whole promotion was a fraud. Note to brands: When trying to pull off a publicity stunt and a commercial simultaneously, tell everyone your plan in advance.

10. KFC IN SPACE

KFC may just be the king of wild publicity stunts. In 2006, the company created an 87,500-square-foot logo at Area 51 in Rachel, Nevada. The company wanted to be the first brand visible from space. And it was no coincidence they picked a spot near “The World’s Only Extraterrestrial Highway.”

“If there are extraterrestrials in outer space, KFC wants to become their restaurant of choice,” said Gregg Dedrick, former president of KFC Corp. The world is not enough for KFC. They need the entire universe hooked on their Original Recipe.

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Fizzled Out: Why Coca-Cola Purposely Designed a Soft Drink to Fail
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In December 1992, media outlets from around the country filed into the Hayden Planetarium at New York City's American Museum of Natural History for what soft drink giant Coca-Cola was trumpeting as a “truly out-of-this-world experience.” In front of reporters, the company's North American president, Doug Ivester, unveiled a 16-ounce silver can that he hoped would change the landscape of soda.

The product was Tab Clear, a new version of the sugar- and calorie-free diet drink first introduced in 1963. While it retained its bubbles, the liquid was transparent, an obvious nod to rival Pepsi’s introduction of Crystal Pepsi earlier that year.

Publicly, Ivester boasted that Tab Clear would be yet another success in Coca-Cola’s long history of refreshment dominance. But behind the scenes, Ivester and chief marketing officer Sergio Zyman were convinced Tab Clear would be a failure—and that is exactly what they hoped would happen. Flying in the face of convention, the launch of Tab Clear was deliberately designed to self-destruct.

 
 

In the early 1990s, beverage manufacturers were heavily preoccupied with the idea of clear drinks that communicated a sense of wellness. The Coors company even produced a clear alcoholic malt beverage, Zima, to capitalize on the craze, but porting it over to the soft drink market was nothing new. In the 1940s, Soviet leader Georgy Zhukov used his friendly relationship with the U.S. to make an appeal for Coca-Cola to produce a clear version of their drink so he could enjoy it surreptitiously and without being accused of indulging in a capitalist product; the soda maker removed the caramel from the recipe, which essentially de-pigmented it. Coca-Cola also produced Sprite, a fizzy, lemon-tinged drink that didn’t use coloring.

But it wasn’t until Pepsi unveiled Crystal Pepsi in 1992 that marketing departments began to pay close attention to transparency in their product. Crystal Pepsi was essentially a fruit-flavored variation of regular Pepsi, with all the typical amounts of sugar and calories but no caffeine. That light could pass through the beverage was a novelty, albeit one that Pepsi believed could help them carve out a 2 percent slice of the $48 billion soft drink market. And if Pepsi could do that, it would mean less money for Coca-Cola.

Like a boxer preparing a counter-attack, Coke couldn’t simply sit back and allow Pepsi to strike without retaliation. But few within the company were sold on the longevity of the clear soda craze. Worse, the company had stumbled badly with New Coke in 1985, a new formula intended to replace the classic version that drew public criticism and created a public relations disaster. Tempting fate with a Clear Coke was out of the question.

Zyman had the answer. Before coming to Coke, Zyman had been a director of sales and marketing for Pepsi; he defected to Coca-Cola just in time for the highly successful launch of Diet Coke in 1982. After a sabbatical, Zyman—a notoriously combative executive who earned the nickname the “Aya-Cola” for his management style—returned as chief marketing officer and devised an ingenious plan to stifle Crystal Pepsi without risking the reputation of Coca-Cola Classic. His sacrificial pawn would be Tab.

Sometimes stylized as “TaB," the drink had been introduced in 1963 as an alternative for calorie-conscious consumers. Sold in a pink can, it was targeted specifically at women concerned about their weight and marketed as a solution to increase sex appeal. Tab, ads claimed, could help consumers “be a shape he won’t forget … Tab can help you stay in his mind.”

With Diet Coke available to help keep marriages from crumbling, Tab was relegated to an afterthought, falling from 4 percent of Coke's overall market share to just 1 percent. Zyman believed it was expendable. If Tab Clear happened to catch on, fine. If it didn’t, the failure wouldn’t reflect poorly on the Coke brand.

But Zyman wasn’t content to simply try to compete with Crystal Pepsi. In his mind, Tab Clear was what consumer brands refer to as a “kamikaze effort,” a product expected to fail. Zyman believed that the presence of Tab Clear on shelves would confuse consumers into believing Crystal Pepsi was a diet drink. (It wasn’t, though there was a Diet Crystal Pepsi version available.) By blurring the lines and confusing consumers who wanted either a calorie-free drink or a full-bodied indulgence, Zyman expected Tab Clear to be a dud and bring Crystal Pepsi down right along with it.

“It was a suicidal mission from day one,” Zyman told author Stephen Denny for his 2011 business book, Killing Giants. “Pepsi spent an enormous amount of money on the [Crystal Pepsi] brand and, regardless, we killed it.”

 
 

With Pepsi set for a massive ad spend on the January 1993 Super Bowl, Coke rolled out Tab Clear in 10 cities, with national expansion coming mid-year. Their ad spending was minimal. Coca-Cola made just enough noise to reposition Crystal Pepsi from a hot, trendy new drink to a product with an identity crisis.

“They were going to basically say it was a mainstream drink,” Zyman said. "'This is like a cola, but it doesn’t have any color. It has all this great taste.' And we said, 'No, Crystal Pepsi is actually a diet drink.' Even though it wasn’t. Because Tab had the attributes of diet, which was its demise. That was its problem. It was perceived to be a medicinal drink. Within three to five months, Tab Clear was dead. And so was Crystal Pepsi.”

The dissolution of soda products on shelves is not inherently dramatic, and there was no visceral evidence on display that Tab Clear was flailing. But by the end of 1993, Zyman’s prediction had come true. Crystal Pepsi had grabbed just 0.5 percent of the market, a quarter of Pepsi's prediction. Both Tab Clear and Crystal Pepsi were phased out and Coke was happy to write the dual obituary. “Now both Tab Clear and Crystal Pepsi are about to die,” Coca-Cola chairman Roberto Goizueta told Ad Week in November 1993.

But it was Pepsi that had spent millions in development and $40 million in marketing; it took the company 18 months to formulate their failure. Coke spent just two months on Tab Clear. It was a barnacle that dragged its far more ambitious rival down with it.

Zyman continued to work for Coca-Cola through 1998. Clear products never caught on as some companies anticipated, though they do experience periodic revivals. Zima returned to shelves in 2017, and Crystal Pepsi has had promotional comebacks.

In one final twist, and despite Ivester's earlier declaration that Clear Coke would never see the light of day, the company’s Japanese arm released a zero-calorie Coca-Cola Clear in the country on June 11. This time, they might even want it to succeed.

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