Monday, February 27, 2017

The Familiarity Heruistic

This week's ICV2 column looks at how familiarity helps us decide.

Thursday, February 23, 2017

Why Your Comics (Probably) Aren't Worth That Much

We get people coming in every week wanting to sell or trade us comics. If you call us, we will try to save you a trip in by asking you a few questions first. Generally, our first question is "What is the cover price printed on the cover?" The price is a key indicator of potential value and unfortunately, the vast majority of comics aren't worth much.

If your comic has a cover price of $1 or more, it probably is not worth very much, certainly not the hundreds of thousands or millions you read about in the news. Why? It was printed during the 80s when the number of comic collectors increased. As the number of collectors increased, the number of collections of books printed during the 80s, 90s and 2000s increased and were polybagged in collections. With so many books around, the law of supply and demand meant that, with a few exceptions, books stayed at cover price or dropped drastically in value.

Your comics have value if they have a cover price of 10 or 12 cents or a quarter if they are Marvel Comics. Comics with those prices were produced long before collectors entered the field and as such, are much scarcer and harder to find in good condition because, well, kids read them and we know how kids, even today, treat things.

Wednesday, February 22, 2017

Gail Simone and Comic Holds

Noted comic writer Gail Simone posted a series of tweets this week pointing out that people who have comic pull and holds at their local shop who don't pick them up can really hurt the shop, even without meaning to do so. Although not a huge part of our business, we do sell enough comics that having someone not pick up their pull and hold will hurt us.

Incidentally, the term "pull and hold" refers to the process of setting up a comic subscription at a store. By setting one up, the store will "pull" off the issues of new comics for you as they come in each week and "hold" them for you until you can pick them up. Hence the term "pull and hold" or just "comic pulls"

Here is what happens when we put in a comic order and generate "pulls":

1. We put in what is called an initial order approximately 2 months ahead of the onsale date of the comics. This order included any subscriptions that we have received from customers as well as comics that past sales or the reading of our customer base lead us to think will sell in addition to the subscriptions. We do not pay for the books at this time and most stores do not require advance payment for subscriptions.

2. Over the next two months, if we get more ordered for a book or think there were be more demand for it than we though, we put in advance reorders, increasing our original order.

3. About 2 weeks before the comics arrive, we order what are called Final Order Cuttoff books. These are comics that have an agreement with the distributor to allow stores to increase or decrease initial orders at this time. Once the FOC goes in, barring a major goof, a store's orders are locked.

4.  Comics arrive. If a store has COD terms, it pays for the books on arrival. If it has extended terms, it can pay 10 to 30 days later. Comics and other items that customers have pre-ordered get pulled out of the order and held for them. The remainder go out for sale.

5. Comics sell. This is the most important period in the selling cycle of a comic books. Since comics are periodicals, a new one will ship about 30 days later. 75% of the sales of a comic take place within 72 hours after it hits the shelf. Any books remaining after about 3 days have only a 25% chance of selling.

6. Comics are paid for. The store has to pay for the comics. Unlike the mass market, comic shops do not, in most cases, get to strip covers off the books and return them for credit. We own the books that we ordered and if we ordered too many of a book we either move it to back issue bins or mark it down.

Here's where the problem with people not picking up their holds comes in. By customers not picking up holds regularly, stores can accumulate a large number of books that will likely not sell. Assume you have 10 customers that each hold 10 books per month at an average cost of $3 per book, who don't pick up their books. That is $300 at retail the store for which the store is liable and likely won't recoup. Individually, a $3 comic may not seem particularly costly but when you aggregate them, they can cut into a store's profitability pretty quickly eventually helping to put it out of business. So, whereever  you shop, please help your comic shop to stay in business and pick up your holds regularly.

Tuesday, February 21, 2017

A Sense of Customer Space

The gamerooms/event space in which we hosted the pre-release events typically do not generate any direct revenue for the store.  We do not put  merchandise in them, save for one in the front clearly visible from the front counter, because of both the easy of shoplifting, even with cameras there, and the likelihood that, with players moving around, merchandise put in the area has a high chance of getting damaged.  That means, unless we have customers playing in them, they are essentially dead space.  It is therefore important that we host as many events, both those that generate direct revenue and those that generate indirect revenue, as possible.

Some events in the gameroom, such as pre-releases and sneak peeks generate direct revenue for the store. The money coming from customers playing in both events was likely money we would not have received had we not hosted the five events.  We host our weekly Warhammer 40,000 and HeroClix events in order to generate indirect revenue, as, by giving those players both a place to play and events in which to play, the 40K players buy more Warhammer 40,000 figures, paint, brushes, while the HeroClix players buy more, well, HeroClix.  Unlike Games Workshop games, there are not a lot of add-ons we can sell HeroClix players, so we rely on the collectable nature of the game and the desire of the players to the new figures to their collections.

Then, we have Nintendo’s Pokemon OP events, specifically designed by the company to make stores rely solely on indirect sales, as company policy does not allow stores to charge admission fees to events such as Pokemon Battle Roads or City Championships.  Nintendo apparently designs the events with the expectation that stores hosting them will generate sales as the players shop the store, either buying cards for their decks prior to the event or making purchases during the event. We have run a few of these and, while other stores may have done well with this model, we have seen no consistent bump in Pokemon sales as a result. We will likely continue them but not bump revenue generating events such as Yu Gi Oh or Pathfinder Society, even for marquee events such as a Battle Roads.

Monday, February 20, 2017

The Choice Paradox

This week's ICV2 column looks at the choice paradox. With hundreds of board games, comics and RPGs to choose from, why do consumers keep going back to the sam small select group? A classic example of choice research with jam indicated that people really don't like to  make choices. Sales of jam went up when consumers were offered a smaller selection of jams from which to choose than when they were offered a selection 4 times as large.

Thursday, February 16, 2017

The Business Cycle Goes Round and Round


A number of stores with which I have talked over the past few months have reported lackluster sales, with at least 40 of them closing up shop since summer. One local store shuttered its doors just recently.  Many of these trading card game focused shops and, with the current softening of the trading card game market (many stores  have noted a downturn in sales in both Magic and Yu Gi Oh, while Pokemon remains fairly steady), they did/do not have a sufficient cash cushion to allow them to wait the cycle out.

Wednesday, February 15, 2017

What Is A Reasonable Price?

Just had a customer come into the store and  purchase a couple of books that he said he had seen online and in other stores but that he hadn’t wanted to buy them until he found them at a “reasonable price”. 
  Though of course I didn’t say it out loud, I thought, “Given the scarcity of these things, the price you found online was a reasonable price, just more than you wanted to pay.”

Most stores hear several times a month, if not weekly, “Wow, you have such and such.  I have been looking for this for a long time.”  Looks at the price. “Oh, well I was looking for this for a reasonable price.”

Most customers don’t realize that stores do set items at a reasonable price (after all, we are in business to sell stuff) but that price has to take into consideration both scarcity and demand.  There is a reason why the Dark Tower boardgame sells for $400 on Amazon and Advanced HeroQuest lists for around $200, while a Theros Thassa’s Bounty sells for a dime or less.  Dark Tower is scarce, Thassa’s Bounty much less so.  There are millions of Thassa’s Bounty cards in print, while no one is making any more Dark Tower or Advanced HeroQuest games (unless Games Workshop or whomever holds the copyright to Advanced HeroQuest decides to do another print run).  People who own copies of either AHQ or Dark Tower generally have a pretty good idea of the value of the game and won’t turn loose of it unless 1) they get what they consider a reasonable price for the game, 2) really need the money or 3) find something they want more. Generally stores get in these games under conditions 2 or 3, as purchasing a product #1 doesn’t leave much profit for the store.

The other major factor coming into play here is demand. There is demand out there for Thassa’s Bounty cards, plenty of demand, but nowise enough to absorb all of the cards that WOTC has put into print.  Conversely, there is demand out there for Advanced HeroQuest and Dark Tower, much more demand than the few copies available can satisfy, driving  the price of those few available copies way up beyond what most people consider “reasonable”.  

However, if you really want a copy of the game, either because it will fill out an empty spot in your collection or you have fond memories of it from your youth (which is what drove sales of the reprints of 1st and 2nd edition AD&D books WOTC release over the past year), $400 is a “reasonable price” to pay for Dark Tower, especially a working copy of the game (our last copy only worked sporadically and sold for $250).


If you remember your Econ 101, what we have here are perfect illustrations of the supply curve and the demand curve. The supply curve says that, as supply increases, price decreases, while the demand curve illustrates that, as demand increases, price increases and where the two intersect is your “reasonable” price”.

Tuesday, February 14, 2017

Robotech Tactics Kickstarter

While I remember playing the Robotech RPG back in the 1980s when Palladium Games first released it, I have not followed more recent iterations of the game, but, back in 2013, Palladium launched a Kickstarter campaign to fund a miniatures combat game based on the series. Here in February 2017, those who funded the campaign, to the tune of around $1.4 million, still have not received the miniatures promised. This forum posting summarizes the events of the campaign as well as a lengthy response from Palladium head Kevin Siembieda.

Monday, February 13, 2017

Border Adjustment Tax

This week's ICV2 column is on the border adjustment tax, proposed by the Trump administration as one form of tax reform. This would arguably solve both the problems of high levels of imports into the US and companies parking their money overseas rather than repatriating overseas profits to the US.

Thursday, February 9, 2017

Return of Nationals and the End of GPTs

WOTC announced today that it will bring back the Nationals,which the company ended about 5 years ago in favor of the World Magic Cup. Along with this, the company also announced the end of the store-level Grand Prix Trials. By playing in a GPT, the winner earned a first round bye at the associated Grand Prix tournament.

The stated reason for ending the GPTs was mixed success and limited turnout. I would have to agree with that as we never saw much interest from players in us hosting GPTs here. The two times we hosted one saw more players from outside the region come to play than did local players. IIRC, out of the region players outnumbered local players by 4 to 1 and we still barely had enough players to sanction the tournament. With the limited turnout, and judge requirements, we never saw much impetus to push a stronger GPT schedule.

Gloomhaven

The most highly anticipated game of 2017 (so far) ships to distributors on the 21 for a likely release in early March. Be warned that, due to the price, size and weight of the game, the publisher will not accept damage claims so purchase at your own risk:

CPH0201           Gloomhaven (Boxed Board Game)  $120.00             019962194719                                 NEW - JUST ARRIVED
PLEASE NOTE:  If ordered, please understand that no damage claim will be accepted for Gloomhaven due to the weight, price and size of this game.  Gloomhaven is a game of Euro-inspired tactical combat in a persistent world of shifting motives. Players will take on the role of a wandering adventurer with their own special set of skills and their own reasons for travelling to this dark corner of the world. Players must work together out of necessity to clear out menacing dungeons and forgotten ruins. In the process they will enhance their abilities with experience and loot, discover new locations to explore and plunder, and expand an ever-branching story fueled by the decisions they make.  This is a legacy game with a persistent and changing world that is ideally played over many game sessions. After a scenario, players will make decisions on what to do, which will determine how the story continues, kind of like a “Choose Your Own Adventure” book. Playing through a scenario is a cooperative affair where players will fight against automated monsters using an innovative card system to determine the order of play and what a player does on their turn.  Made in China.

Tuesday, February 7, 2017

WOTC Sales

Hasbro posted significantly higher sales than expected for both the 4th quarter of 2016 and the entire year. Some 80% of WOTC sales were through hobby game stores such as ours and similar outlets, which I would take to mean comic shops and hobby stores, not the mass market such as Walmart and Target.

Unfortunately, much of WOTC's focus for the future is towards the digital version of the game, as mentioned in missives from the company CEO. Much discussion about the online version of Magic, no mention of the physical game.

Monday, February 6, 2017

Kickstarter as Distributor

Scott's column on ICV2 this week looks at the future of distribution in the game industry and sees Kickstarter playing a major role.

Friday, February 3, 2017

D&D Diesel

In case you missed the movie The Last Witch Hunter in 2015, as many people did, one of the things Vin Diesel did to promote it was to play in a game of D&D with Geek & Sundry's Critical Role cast. You can watch the extended video of the game session here.

Thursday, February 2, 2017

Good Promotion

If you are a game company looking to develop promotional material to help stores sell your product, you could do far worse than this poster provided by Brotherwise Games to promote Boss Monster. The poster clearly shows what the game is about, some art and gives a quick overview of how to play, along with a shot of the box cover.  Nicely done.

Wednesday, February 1, 2017

Wizard DM


Your D&D Game is always better when you have a wizard running it.