RETAILERS URGED TO PLAY UP GAMES

DAN ALAIMO

CHICAGO -- Retailers are shortchanging themselves and their customers by not carrying a larger selection of video games to rent, said a speaker at the first Videogame and New Technology Conference put on by the Video Software Dealers Association here April 10 and 11.

"By not making the video game area as important or enticing as the video movie areas, it sends a signal to your customer," said Bud Werner, vice president of merchandising at Sega of America, Redwood City, Calif. "That signal is that it lacks importance and maybe they should shop somewhere else. Do you want a business with a potentially high rate of return to be an afterthought or impulse in your store? Wouldn't you rather have your store be a destination location?" he asked.

"The video game section has big potential to yield a rate of return per square foot much higher than that of most movies. You can drive more volume with less inventory when you buy correctly," he said.

An average inventory of video games could yield a return three times greater per square foot than movies, he noted. "Therefore the allocation of space should be commensurate with the rate of return," said Werner.

"Movie titles tend to grow exponentially because you want your stores to look full in case that one customer wants that one classic movie. Yet the small section of video games, with hand-made signage, in an obscure corner of the store, is drawing bigger crowds and yielding more rentals and-or sales,"said Werner.

Retailers can boost video rentals and sales by focusing on customer satisfaction, he said. The key to this is making sure in-store personnel are sufficiently informed about games to help people make decisions, he said.

Game magazines play a key role in this, Werner said. "Trade magazines offer the best and fastest explanation on current software and hardware," he said.

But game-playing experience is even better, he noted. "Offering your sales staff the opportunity to play new games will increase awareness and excitement. First-hand knowledge of the games gives your sales people the ability to suggest additional rentals and to cross-sell," he said.