Game Fly CS 453 E-Commerce Technologies Case Study

Game Fly CS 453 E-Commerce Technologies Case Study One September 11, 2007 Carlos Valle Robert Yip

Netflix Equivalent for Gamers l l Online video game rental subscription service Fixed monthly rates for rental • Two games out at a time costs $22. 95 per month. (Most popular and promoted plan. )

Background – The Beginning l l Launched on September 8, 2002 Founded by • David Hodess, CEO & President • Sean Spector, Co-Founder and VP of Business • l Development and Marketing Jung Suh, Co-Founder and VP of Content and Strategic Alliances Headquarters in Los Angeles, CA [3]

Background – Present Day l Distribution hubs at Los Angeles, CA initially, expanded to include Pittsburgh, PA l Over 5000 video game titles to choose from [2]

The Service l Video Game Rentals • Sony Playstation 2, Microsoft Xbox, Nintendo • • • Gamecube – September 2002 Game Boy Advance – Late 2002 Nintendo DS – November 2004 Sony Play station Portable – March 2005 UMD movies – April 2005 Xbox 360 – November 2005 Nintendo Wii, Play station 3 – July 2006 [3]

Options l l Four different plans offered, depending on how many games are rented at a time. All plans are for unlimited games, meaning that the user is not charged on a per-game basis, but on a monthly basis. 1. One game out at a time costs $15. 95 per month. 2. Two games out at a time costs $22. 95 per month. (This is the most popular and promoted plan. ) 3. The three game out at a time plan, which is only eligible to users 4. in good standing for a duration of 60 days, costs $29. 95 per month. The four game plan, which is only available to eligible users in good standing for about 60 days as well, costs $36. 95 per month. [2]

How It Works l l l Select a subscription plan Payment linked to credit card Add games to “My Game Q” based on priority Games shipped through United States Postal Service in re-mailable, pre-paid envelopes Keep the game(s) for as long as you want

My Game Q l ‘Q’ is a priority queue [2] Currentals Various systems Option to buy Availability Shipping priority

What Was the Need? l l Similar to Netflix, more convenient In-store video game rentals more expensive than movie rentals Convenience Try Before Buy Cheaper Simple interface

Expansion of Game Fly l New-generation games are expensive l Online retailer makes shopping simple • Xbox 360 – $59. 99 • Playstation 3 – $59. 99 Rent and try out game Return for another game Purchase and keep it

Service l Game Fly provides email and phone customer service. Email customer service is available seven days a week with a 24 to 48 hour response window. Phone customer service is available Monday through Friday from 9 am-1 pm PST. [2]

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Competitors l Other online video game rental services • Gotta Play • Gameznflix • DVD Avenue

Gotta Play l Advantages l Disadvantages • Offers Game Boy Advance games • Only 4000 titles compared to Game Fly’s 5000 • Offers a maximum of 3 games out at a time [1][5]

Gameznflix l Advantages l Disadvantages • Offers DVD, Blu-ray, and HD-DVD movies • Does not offer handheld console games like Playstation Portable, Game Boy Advance, Nintendo DS, or Universal Media Disc [1][4]

DVD Avenue l Advantages l Disadvantages • Also offers DVDs • Focus is on DVDs • Only offers Playstation, Playstation 2, and Xbox games [1][6]

Maintaining the Value Chain l Value Chain Pirate • Displaces Blockbuster and other video game rental • centers Offers innovative rental solutions which Blockbuster has mimicked [8]

Target Audience l l Teenagers to middle-aged adults who have Internet access Gamers with no means of transportation Enjoy the comforts of home Value-conscious consumer

Marketing Strategies l l Friendly user interface Discounted prices Commercials on television Free 10 day trial [2]

Opinion: Viability l Will stay competitive as first rate renter if competitors do not • Provide faster shipping • Offer cheaper subscriptions • Develop innovative video game delivery options such as downloads

Opinion: Improvements l l Needs to expand beyond the two current shipping hubs Maintain favorable and popular video game selection Could slightly lower prices to have another edge over the competition More advertisements [7]

References 1. 2. 3. 4. 5. 6. 7. 8. http: //www. allgamerentals. com/ http: //www. gamefly. com http: //en. wikipedia. org/wiki/Gamefly http: //gameznflix. com/hello/default. htm http: //www. gottaplay. com/ http: //www. dvdavenue. com/user/home. New. User 2. php http: //www. gamespot. com/wii/action/metroidpri me 3/index. html? tag=topten; all; img; 0 http: //www. blockbuster. com/