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Hi everyone - I'm hoping to garner some opinions on a retro gaming idea, if you would be able to help...

 

I've got a business opportunity focused on gaming (arcade & consoles only at the moment) and one idea I've had to make it a bit more interesting to current and potential gamers is to provide a service a bit like Graze, Pact Coffee, Abel & Cole, etc.

 

The idea is that you can go online, select which consoles you own and subscribe to a service that posts you a different game every month. You can play it and then send it back or you can keep it for an extra fee. So, if you said you had an N64, you might get Diddy Kong Racing, Banjo Kazooie or Super Smash Brothers for your first 3 months. You could send a couple back and keep one, if you felt so inclined. We would never send out the same game twice and you could cancel with 30 days notice.

 

My questions I'd like to get some opinions on are;

- Would you like to get one or more games sent to you every month?

- If so, would a cost of £7.99 per month, including return postage, put you off?

- Have you heard of anyone else providing this service? If so, what's good and what's bad about what they do?

- What would really put you off from signing up?

- What would make you sign to the membership package immediately?

- If there were other benefits to the subscription, such as small loyalty rewards or exclusive social events, would that be of interest?

 

Thanks for taking the time to respond - I genuinely appreciate all the feedback, good or bad, and will respond to everyone!

Mark

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This seems like a really difficult thing to make money from between collectors wanting to build a collection and people who'll dip into emulation just to experience the games for themselves. What would you offer that buying your own games from eBay and specialist sites/forums wouldn't?

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Someone tried it in the UK a couple of years ago and it failed miserably. You need to be making a lot of money and have piles of capital as it's a loss maker really. Perhaps if you had a chain of gaming stores you could build something like this.

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Problem is retro games tend to fall into two categories;

 

super cheap <£10

too expensive to justify >£50

 

there are of course games in the middle. 

 

If you offer a sub for £8pm and supply only games that fall in the first category you'll lose customers quickly. 

 

If you supply games that are worth more than £50 you'll likely never see them again. 

 

If you're aiming this at retro enthusiasts you'll be hard pushed to keep them interested for any length of time without AAA retro games. 

 

Speaking personally, I'd be expecting three games like SOTN, Rapid Reload and Deep Fear. 

 

You'd need so much capital to start with it would be unreal!

 

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43 minutes ago, Lorfarius said:

Someone tried it in the UK a couple of years ago and it failed miserably. You need to be making a lot of money and have piles of capital as it's a loss maker really. Perhaps if you had a chain of gaming stores you could build something like this.

 

What was it called?

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You might be able to offer a service where you get a piece of hardware, a framemeister and 5/10 games for a month for something more like £50 a go. 

 

Youd need ever some sort of liability insurance though for damage, loss etc. 

 

As as a retro gamer who can't be arsed getting a vectrix, a FM towns marty, a cd32 etc. I'd consider £50 to "rent one". 

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10 minutes ago, Droo said:

You might be able to offer a service where you get a piece of hardware, a framemeister and 5/10 games for a month for something more like £50 a go. 

 

Youd need ever some sort of liability insurance though for damage, loss etc. 

 

As as a retro gamer who can't be arsed getting a vectrix, a FM towns marty, a cd32 etc. I'd consider £50 to "rent one". 

 

 

There is absolutely no chance of something like this ever making a profit.

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I didn't say it would. But as a customer, I'd  pay that price for that service. 

 

Id not be likely to pay £10 a month for retro games of weak quality. 

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24 minutes ago, Droo said:

 

What was it called?

 

I forget! It'll come back to me but there was a huge fuss at the time because they couldn't supply all the stuff and they disappeared or some such.

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I think it's a flawed concept, and one that's difficult to scale. If the service was to get more popular, where do you then buy multiple copies of games that are in some cases difficult to get hold of? Can you imagine the stock you'd need to cater for large numbers of subscribers with different consoles? What about the logistics?

 

Your real competition is the internet & emulation. All it takes is Nintendo for example to release a repro SNES (like the NES due later this year) and a big chunk of your business is gone. Your likely customers are probably up on emulation on PC or Raspberry Pi anyway.

A £30 box would do everything you can.

 

With any business plan you need to work out the numbers - Look at costs of stock needed, expected subscriptions, postage, web page, cost to replace missing/stolen carts, cost of legal action against people who just keep them etc.

You also need to earn a wage that's worth your while too - This is one thing that lots of people forget to consider.

 

I think with just a few subscribers you won't make money, and with a lot you'll struggle to get stock to keep them happy. I know there's millions of carts out there but you can only play so many copies of Earthworm Jim or Mario Kart before you get bored.

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A Vectrex sent backwards and forwards in the post would last five minutes.  SOTN being passed around via a postal scheme is the stuff of nightmares.  

 

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If I were a subscriber, I'd expect some real treats at least occasionally.

For example, a typical SNES rental might be Super Mario World, or Mario Kart, Zelda, Metroid, F-Zero etc.. Relatively common but still great games.

Every once in a while (maybe once a year) I would expect to be playing a game like Secret of Mana, or at the very least something semi-collectable or considered expensive.

 

If you only offer common games (because that's all you can afford to stock or can get hold of) why would I pay you £8 when I can just buy the cart on eBay for not much more?

 

You really have to make sure your Ts & Cs are watertight before sending anything collectable out. Having a solicitor write those up costs money that has to be considered.

 

Sorry for the negativity, but I think you should always be frank and honest when people ask about business ideas.

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Sadly have to agree with the others, everything would have to be sent via a insured service like Royal Mail Special Delivery which is around £10+ per package. You would also have to insure every game you sent out to cover any losses and that wouldn't be cheap if you game is worth £50+. So £7.99 would be far to cheap and just be a loss leader can't see it working.

 

You would be better off doing a tour type set up where you set up retro console for special events / hospitality or take them round to schools, hospitals, Universities where you have like a market stall for people to play them for a day, that way you can keep a watchful eye on the content and get the venue to pay you, which you would stand to earn a lot more with a lot less risk.

 

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It's a lovely idea but I can't see how it would work, mainly because of everything that's currently been said. I imagine if someone paid £8 and got a £100 game sent through to them they might be tempted not to return it.

 

As a N64 fan I'd want to play Smash Bros, Conker's Bad Fur Day and Beetle Adventure Racing. That's around £200 right there.

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I would assume that if a game doesn't get returned it automatically triggers the "pay an extra fee to keep it" and if it's a £100 game it'd be ~£92 to keep it. That doesn't mean people won't try it on, but it reduces it a fair bit. You'd probably have to charge a deposit to get any insurer interested in covering it though.

 

Speaking as someone with lots of retro games, I definitely wouldn't bother signing up. If I really wanted to try a game I'd buy it, as much as they're expensive the loss you'd make buying and then selling a £100 game on ebay won't be much more than £8.

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19 hours ago, cubik said:

Your real competition is the internet & emulation.

 

Exactly this. I'd prefer to play on the original hardware where possible, but when my options are to either pay £7.99 for something from a limited selection (and it will be limited), or absolutely nothing for virtually anything from the entire catalogue, I'm more inclined to go with the latter - particularly if the paid service doesn't give me a guarantee of what I'll get.

 

Plus, there's a problem with diminishing returns with time. Even if you had a limitless catalogue of greats, you're going to have trouble retaining a customer after one or two years when they've played the very best a system has to offer, unless they have multiple machines. At that point, you're veering closer to retro gaming enthusiasts who are more likely to collect to own than anything else.

 

As a purely digital service with solid emulation, no stock problems, and full legality, then maybe.

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On 11/09/2016 at 19:18, SMD said:

This seems like a really difficult thing to make money from between collectors wanting to build a collection and people who'll dip into emulation just to experience the games for themselves. What would you offer that buying your own games from eBay and specialist sites/forums wouldn't?

I think it makes sense to expand on what else I had in mind...

 

1. The business has a successful retail premises which has been profitable in the past 2-3 years but has been break even over the past 12 months as the owners have turned their focus to another venue. They offer repairs as well as consoles, games and peripherals for sale. If the numbers stack up, I'm interested in taking it over and seeing if there's potential to grow the business.

 

2. They sell a range of items both in-store (80% of sales) and online via their own website (20%), which is plugged into a sophisticated EPOS system. They have used eBay / Amazon in the past but both sites have increased their fees so it's not quite so attractive any more.

 

3. @SMD- My vision is to redecorate the store and make it more of a member's club; a shop by day but then a small bar at night where members would be able to play on consoles hooked up to wall-mounted flat screen TVs - 3 screens with 3 portable trolleys beneath so that the consoles can be changed regularly, meaning that customers can come in, try before they buy, play something different, etc, or just hang out, grab a coffee and enjoy themselves. In terms of coffees & teas, the shop is right by a busy bus stop that numerous commuters use and there isn't a coffee shop nearby. There are a couple of bars for evening events nearby but they're just pubs.

 

4. Initially, any subscribers to the rental service would be able to visit during members' nights exclusively - there's currently a customer database of 10,000. Following the feedback, perhaps there's a different approach to a subscription rental service so members could simply ask to join.

 

5. I have given some thought to both renting out the venue for private parties and renting out console and game packages but both options don't necessarily have predictable, regular income so forecasting is pretty difficult.

 

6. Stock-wise, I'd be starting with roughly 2,500-5,000 games with 150-200 for GBA, Spectrum ZX, PS1, PS2, Mega Drive, Xbox, NES, N64, Game Cube and Dreamcast and then roughly 50-100 for SNES, Master System, Atari, GB Original, Dreamcast and a few others. My concern was that is that if you have a subscription model, you don't really want to send people games that came bundled at launch as it would be a bit disappointing to get a game you've had since you owned the console.

 

7. @Droo - I like the idea of console, upscaler / cabling, couple of controllers and a handful of games - I don't want the cost to be prohibitive and I agree with the insurance question. @Camel has a point re: postage and I think my concern would be that the recipient gets a sub-quality cartridge / hardware because of Royal Mail and then you'd need to offer a refund and it would take a while to get compensation from the Post Office, who probably wouldn't understand the intrinsic value of the item!

 

8. @cubikWhat about if you were to get 2 games (N64 - Donkey Kong Country & Ogre Battle 64)? There could be different packages for AAA games - i.e. Bronze, Silver and Gold, different prices, different volume/quality of games sent out. If Ts & Cs weren't a problem, would that be more interesting?

 

9. @Riven- I like that idea but I'm conscious of needing a car/van to transport the kit around, which comes with an extra consideration and cost.

 

10. @cubik/ @Fry Crayola- I think emulators / Internet, yes, but then the retro gaming market is apparently still worth £126m per year (I read it on a Sky News report so it must be true...) For me, the appeal is still the original devices and playing it 'properly' but I may be in a minority. It was suggested that a Raspberry Pi might be a more appealing option but a) most people can't be bothered to 'build' their own console and b) only 8m Pi have been sold globally - compare that to 30m+ Mega Drives.

 

Thanks again everybody for your comments - please keep them coming!

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I can't see it working in a random rental format. For me, most of the retro enthusiasts I know are more into building a collection. It may be that they collect a certain system for a while, then move on to a different system and sell the previous one, but  the ownership part is important. 

 

What I could see working would be a club which would be able to hunt down and supply you with certain titles at a preset price, and give you a guaranteed buy back price, say 2/3 of the price for a length of time. 

 

This could save people the effort of trawling eBay and getting sniped at the last minute, plus give them a few months to own the title and decide if the want to keep long term or not, 

 

if the club could also supply the best leads for connecting retro consoles to HDTV's and replacement power packs that are reliable that would also be good! 

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Thanks for expanding on things - You're obviously thinking this through seriously.

 

I'm starting from a pessimistic point of view which isn't meant to piss on your parade, just analysing things and doing what a bank's small business manager should do.

My initial slightly rambly thoughts on your points:

 

1) The existing business seems to have slowed down or stalled - Why is this? The current owners say it dropped because they are focused elsewhere, could it be that they're now focused elsewhere because business has dropped? I assume you know them well if you're talking about buying it.

 

2) Where is the store based? Obviously you'd do much better in a large affluent city as opposed to a small run-down mill town.

 

3) Regarding the shop by day, club by night idea - How would you attract in good punters whilst keeping out the scrotes? <Daily Mail mode on> Lots of shops that deal in second hand gear attract the kind of people that keep more affluent customers who might spend money away.

You mention that there isn't a coffee shop nearby - Is this a genuine gap in the market or will the area not support one? Reason I ask is coffee shops are everywhere, so it seems odd there isn't one.

A commuter bus stop will be busy first thing in the morning and then at home time. Who are your potential customers between 9:30 and 4:30?

 

4) Exclusive member's nights - How would this work when you're looking at a potential mail order service? How many of your 10000 list is local? I wouldn't drive 100 miles to visit a shop that is going to post something to me.

 

5) Renting out for private parties sounds like a reasonable idea. Would most likely be more popular if you had a license to serve alcohol, but then the whole situation gets much more complicated as you'd essentially be opening a bar. Could it be simplified, for example would a private party (e.g. a 40th) be allowed bring their own drinks?

 

6) You've obviously got stock - Would you intend to rent out more fragile items such as Spectrum cassettes for example? They'd be pretty easy to get wrecked.

 

7)

 

8) I think offering different levels of game quality is open to interpretation. I know plenty people who would hate Secret of Mana and would happily play Altered Beast all day long. (maybe not Altered Beast but you get my drift).

 

9) 

 

10) How many of those 30m+ megadrives are in a loft/broken/the bin/will never see light of day again etc? Saying that, someone at work who I definitely wouldn't class as a retro gamer recently bought a Megadrive from eBay the other day just to have a bit of fun on Sonic etc and get nostalgic.

 

As a positive note, one place where emulation could come in useful is in the shop itself. Imagine someone wants to come in and buy some Spectrum, C64 games on cassette etc but wants to try them first. Fire up the in store Pi and they're instantly loaded.

Obviously it doesn't prove that the cassette is OK but it avoids any more wear and tear on 30 year old games. It's possibly ropey on the copyright front and could encorage people to not buy your games and build a Pi emulator but maybe worth a thought.

 

 

 

 

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You could try marketing this away from retro gamers and more towards people who don't really play games in their 30/40/50s.

 

Consider the idea of a wife buying a SNES console from you and a year sub for her husband's 40th. 

 

Thats a good gift, worth maybe £200. Husband gets a bit of nostalgia that drips along over a year. Same chap probably has no preconceived ideas about value in games like bona fide retro gamers do. So your £10pm sub might be perceived as better value for money for them. 

 

Youd be advertising NOT in gaming mags but elsewhere. 

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16 hours ago, cubik said:

10) How many of those 30m+ megadrives are in a loft/broken/the bin/will never see light of day again etc? Saying that, someone at work who I definitely wouldn't class as a retro gamer recently bought a Megadrive from eBay the other day just to have a bit of fun on Sonic etc and get nostalgic.

 

1 hour ago, Camel said:

I doubt that anyone with a really casual interest in old games would want to be bothered with the faff involved in using old hardware tbh.

 

QED

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Nah, he'll end up one of us.  We've all got to start somewhere.  I got back into retro when I saw a 2600 in the window of a Computer Exchange at Notting Hill.  Not sure I would have rented one.

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This seems like one of those wistful "wouldn't it be great if..." ideas you chat to your mates about, but for all the reasons already stated I can't see how there'd be any kind of viable business model here. Sadly.

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What happens when they can't figure out how to connect it to their new fangled TV because it doesn't have an hdmi lead?

My comment regarding someone at work was genuine, but I know full well they bought it because it was fun & cheap, I can't see it still being in use in 6 months. They aren't going to start hoarding old games and becoming a rabid collector any time soon.

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If the shop became a venue for people to come and play games rather than buy them, do you think there's any interest in that? I'm thinking 90s tunes, big screen setups and sofas so it feels comfy and relaxed (not clinical like an Apple Store or fusty like an old boys club but clean, fresh and stylish).

 

(WARNING: Business Hat Firmly On) I'm waiting to see the financials as what it did in 2013-2014, before they turned their attention to their other business, is going to be a good indicator of the potential. However, my hunch is that the only real profit that can be made is through a) consumables such as food & drink and b) rental of games rather than sales to avoid long-term issues with supply. As has been mentioned, older games will wear out, Ebay and Amazon can offer outright purchases for widely available games more cheaply and new products like the Retron 5 can increase the risk to the venture. That rental could take place on the premises or off - they both have pros and cons of course.

 

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