Gamestop Business Analysis

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ONE: GameStop's dependence on developed countries results in lost opportunities due to lack of market development (entry in new markets) and low learning curve in how to compete in markets with PESTEL differences. Opportunities for vertical and horizontal integration through mergers and acquisitions are present especially when there are large gaming markets in China, India, and Latin American nations where income is quickly rising apart from improvements in their communication and transportation infrastructures. See Figure 3. It shows that in 2017, 47% of consumer spending came from the Asia-Pacific region (McDonald, 2017). Asia-Pacific alone will grow at 9.2% year-on-year to $51.2 billion with China composing $27.5 billion (McDonald, 2017). …show more content…

Software developers and publishers are available. Eighty-five percent of U.S. employment for software developers and publishers in the video game industry is located within 7 states (California, Washington, Texas, New York, Illinois, Florida, Massachusetts). The gaming software publishing industry’s total value add to the U.S. Gross Domestic Product in 2015 was $11.57 billion (up from $10.93 billion in 2013) (Siwek, 2017). Though referring to software developers in general, the U.S. Bureau of Labor Statistics predicts 30.5% job growth by 2026 (United States Bureau of Labor Statistics). Also, a new business model has emerged for monthly online subscription services, similar to Netflix, for video games with PlayStation Now and Microsoft Xbox Game Pass (Will Microsoft's 'Netflix of Gaming' Model Mark the End for GameStop?). Subscription services and digital downloads will negatively impact the future of physical software sales (Seitz). GameStop does not offer these services. In addition, over the past 20 years, e-commerce has flourished to enable consumers to purchase video game products from online merchants. More recently, video game manufacturers are selling video games and telecommunication services directly to consumers via digital downloads and streaming subscriptions. GameStop has online stores but it has yet to become the Amazon of the online gaming sector. It needs to seriously consider how it can use its brand and resources for product development and market development apart from diversifying in unrelated