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This case study looks at GameStop, which provides games and consoles at an affordable rate and at super convenience. It looks at how the company's supply chain operations are different from its competitors.
Sayan Chatterjee and Timothy Yee
Harvard Business Review (W11640-PDF-ENG)
January 16, 2012
Case questions answered:
- What is GameStop’s value proposition and who is its target market?
- What are the outcomes that GameStop’s target market expects and what activities and resources are the company utilizing to support those objectives?
- How do GameStop’s supply chain operations differentiate it from the competition?
- Who are GameStop’s main competitors, and do you think the company has established a long-term competitive advantage over them? Explain.
- What (if any) changes would you recommend to GameStop executives to grow going forward? Do these involve modifying their current supply chain strategy or executing differently/better?
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Case answers for GameStop
1. What is GameStop’s value proposition and who is its target market?
GameStop targeted focused customer segments and created value by providing games and consoles at an affordable rate and at super convenience.
The hassle-free trade-in process made it convenient for the customers to bring their product to local GameStop stores and trade in their used consoles or games.
The flexibility given to any customer to either accept the monetary value in cash or trade-in for other games or consoles also added value to their customers.
The company also maintained high accessibility to their customers by providing a huge variety of options to choose from. Also, the shelf placement at the store was done in such a way that it made comparisons with other versions of the console very easy for the customers.
It also made sure that it kept itself at par with the market and maintained its brand and reputation through providing high-level customer service and employee relations. Also, the concept of selling video games in a store location was new, which helped them to establish their name.
GameStop had a huge customer market. It categorized its market in a very much similar way to its segments.
First, there were Devoted or the Electronic Game Enthusiasts. A customer segment that demanded the best and newest games available.
Then, there were the Casual/Occasional or the Value-Oriented Casual Gamers. A customer segment that was characterized by demands of used and less expensive games.
The third target customer segment was the Seasonal Gift Givers, who demanded promotional deals during peak seasons. The first two segments, that is the Electronic game enthusiasts and Value-oriented casual gamers were price sensitive.
2. What are the outcomes that GameStop’s target market expects and what activities and resources are the company utilizing to support those objectives?
GameStop had a huge customer market. It categorized its market in a very much similar way to its segments, with…
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