One thing that's not mentioned is periphery sales. Though store A has 50 players and store B only 25 with A only generating $5 more profit from the event, how much, on average, does a player spend on impulse purchases, snacks and drinks, supplies etc.?
If the average is say: 1 soda, 1 bag of chips and $5 randomly then we’re looking at $6 – $8 each:
25 x 6 - $150
50 x 6 = $300
The profit is identical as long as you’re not discounting. Assuming normal margins of approx. 40% = 25 players - $60, 50 players - $120
Therefore the gross profit moves from 295 to $355 for 25 players and $420 for 50 players. A difference of $65.
Now measure that against a marketing program for all those extra players coming into the store and seeing what a great experience you offer. This gives you the chance to obtain a few extra players. Goals for an event like this, with discounted pricing, should have the goal of marketing the stores events/experience and retention of a new player attending. That can have a seriously positive impact on long term profits.
In the end, you now have a marketing event that generated enough to be in the black. Not many marketing initiatives can be that way.
To help generate more profits and bring players back:
- Have other events going on to generate more cash flow. 0-2 drop. Get them playing something else and still having fun rather than drifting away.
- Offer incentives for them to return. Prizing as store credit for example.
- Loyalty based event attendance. Play in 10 events get the 11th for free. Attract, grow, retain.
- Always focus on making the events as compelling as possible. If the players have an awesome time they'll be back but they'll also positively virally market the store and that’s priceless.
Players are local, therefore they can be brought back. Players simply don't travel far for pre-releases as there aren’t huge prizing attached to them.
The one thing is true. Expectations. Do this once and the player expectation is that it'll be repeated. Many stores get caught in the trap of offering regular low cost tournaments and can't increase the cost without the fear of losing players. Do NOT discount more than occasionally as a special marketing push.
For more ideas on how stores can add compelling OP ideas they can contact me anytime. Doesn't matter if they're a customer of ours or not.
The opinions expressed in this Talk Back are solely those of the writer, and do not necessarily reflect the views of the editorial staff of ICv2.com.
