Just to be clear, when you said, “If a retailer has to change their discount on a $30 game from 35% to 20% the net effect is only a difference of $4.50.”, you meant that $30 was the MSRP or “list price”.

It could be misinterpreted to mean that the $30 was the 35% discount price, in which case the price difference to 20% would have been closer to $7.  (This was my first interpretation, but I did the math to understand what you were trying to say)

It’s not that hard to see both sides of the coin here.  I can totally see why consumers feel that they are getting a raw deal, but let’s face reality.  The online stores must be making really small margins if they are selling at 35-40% of list price.  Surely Mayfair are trying to ensure a healthy future for the businesses through which their games are sold?  If they all start to close due to falling profits, as Adamspielt in Germany is doing, who benefits?
I also find it hard to sympathise with the American gamers who are complaining so vocally since they already enjoy list prices way below the UK, and another 35-40% off that.  We’re lucky to get 5% off if we place a considerable order.

Stephen, good point.  I’ve added “MSRP” so what I wanted to say is clearer.

"While it appears that these people are trying to make a moral stand, the cynical side of me thinks that it really comes down to money.”

That’s not your cynical side.  That’s just the side of you that can see the cold, hard fact that many people on BGG are under the erroneous impression that 35% discounts are a right instead of a privilege.

I haven’t read everybody’s comments in The Great Big Thread, because there aren’t enough hours in the day, and because I was getting physically ill from all the comments by people who chose to interpret Mayfair’s business decision as some sort of personal assault.  However, I didn’t notice anybody mentioning Mayfair’s recent change in management.  Will Niebling (I might have spelled that wrong) just left Mayfair in someone else’s hands to start Elfinworks.  I have no idea how much or how little impact this information has on the matter at hand; I just thought it was a curious omission in the first eight or so pages of the thread.

"I would expect that some neighborhood game stores could be frustrated by this as they are able to introduce people to boardgaming simply through their local presence, and then lose those same customers as they become aware that the same boardgames can be acquired much more cheaply via the internet.”

Hammer => Nail

A day doesn’t pass that I am not treated as a showroom for ThoughtHammer. While I have a loyal following and have discount programs in place for repeat customers, that extra dollar or two of savings drives people out there when they buy in bulk for the free shipping. Even yesterday, I spent 1/2 hour helping a guy find a game for a friend and pulled out demo copies, helped him hone his choice, and BAM “Thanks, I’ll pick that up online. *walk out*”

But back on track, the arguement that this is non-capitalistic is completely baseless. No, it is capitalistic because Mayfair (and quite a large group of other publishers who have been doign it for years) has decided that they feel that their product is best served by many different venues and in the long term goals require a balance of online and physical. Seriously, if Mayfair only wanted their products sold online, why wouldn’t they just sell it themselves and beat out the middlemen? Capitalisticly, they made a decision to set a price and as a reseller, we agree on that contract points. This is nothing new, ask your LGS about Games Workshop’s requirements to sell. Ask about the hoops they need to take to be able to sanction MtG tournaments and get support. Heck, even from a retailer<->distributor relationship, most of my contacts state that I must make over 50% of my sales at a physical location because so many companies that the distributor works with mandates that because they must see the benefit of the local game store in getting visibility for their product. Besides, what would stop the distributor from just selling online themselves and even bother selling to physical retailers if they didn’t have that agreement with the publishers in the first place?

Here is my take on it… Mayfair has a few good games, but they don’t come out with as many games as other US publishers and, quite frankly, there are fewer of their games that I am actually interested in. They are not a “premium brand” in my book, like Rio, Z-Man, DoW, or FFG, but rather a second-tier publisher with one strong line (Settlers).

Look at the Essen list and note how many titles there are in the Mayfair entry (It was 4: Chicago Poker, Gangster, Monuments of Antiquity, and Patrician).

On many things they publish, they release the titles sometime after the German title is released, rather than at the same time, like many other US publishers.

So my choices when i go game shopping appear to be… Buy a new Mayfair title and pay more than I am accustomed to and realize that the game has been available for 3-4 months already in German editions, buy a German copy of a game Mayfair will one day make and do paste-ups, or buy a product that has a better perceived value that comes from one of the other US publishers (RGG, FFG, Z-Man, DoW, etc.).

Well, given those choices, I am not going to actively boycott Mayfair, but I don’t see a lot of their games coming my way either.

"Well, given those choices, I am not going to actively boycott Mayfair, but I don’t see a lot of their games coming my way either.”

And i should add… This has been the case for a while. I often have less interest in, and therefore don’t buy, many Mayfair titles.

I am holding out for, and looking forward to, the Mayfair version of the 5-6 player expansion for Pillars of the Earth.

I actually wouldn’t expect the cost of enforcing this to be high. While, as you note, many locations sell Mayfair games, the ones which matter are the online ones - as you also note, the B&M stores aren’t in the habit of discounting deeply.

Tracking online store prices is trivial, with the advent of tools like boardgameprices. Also, there are not many popular online stores, and tracking only them would control the majority of sales.

While the eBay concealment may be an issue, eBay is generally friendly to publishers looking to enforce their distributor and retailer agreements. I also wonder if the number of games sold on there, as a first sale to a consumer, is significant.

Yahoo to Mayfair games for taking this stance and I hope that Rio, FFG, etc, all do the same thing. The only way for the boardgame industry to grow, prosper and thrive is for everybody from Designer to Retailer to make a reasonable profit in the business. Mayfair is taking steps to ensure that happens.

The bottom line… its all about the money. Are Mayfair sales going to take a significant hit because of a policy like this? I doubt it, but of course time will tell. Most of the folks I know buy the games they buy based on the game itself and price is not a significant factor.

I have long maintained that this is a very inexpensive hobby. Forty or fifty bucks sure can buy a whole lot of quality entertainment for a table full of people.

Peace

Scott, you beat me to the topic as my column tomorrow is also about the new Mayfair policy. My column is twice as long as yours if that means anything.

Even so, one aspect of the deal that I didn’t cover in my column is that such pricing contracts typically allow a retailer to offer lower discounts on a limited basis. If I’m stuck with lots of copies of the Settlers of Pillars expansion, I can lower the price to clear them out; I just can’t offer the games at a lower discount on a regular basis.

Eric

As you say, Scott, one’s feelings about this are directly related to where in the gaming food chain you sit.  Opinions fall almost exactly as they do for the longstanding online stores vs. FLGS argument, which has raged for years with few minds being changed, despite increasing evidence that the paradigm has shifted and that the online retailers are also doing their part to spread the hobby.

Mayfair presumably is trying to ease the pressures against the B&M stores, but it’s not easy to see how they will succeed.  As others have mentioned, the only way it appears this could work is if other companies follow suit.  But which of them will be tempted to do so?  Jay Tummelson has already indicated that he will not restrict his prices and given Rio Grande’s business model, where they introduce many new items every year, I’d think it would be suicidal for him to do anything else.  The same is true, to a lesser extent, with most other U.S. publishers.

Days of Wonder might be able to follow Mayfair’s lead, since their eye-catching titles must do very well in retail stores and since the Ticket to Ride series is such a cash cow.  But that very success may work against this, as it’s not clear their products would sell *that* much better in an FLGS if they raised internet prices.  So it sounds as if they might only help B&M stores marginally, while cutting into their own profits.  My guess is they will continue as they do today.

That leaves Fantasy Flight as the most likely company to follow suit.  They’ve grown to practically be a hydrid publisher, half Games Workshop-style, half Rio Grande-style.  The GW side could probably easily handle the ramifications of a policy like this, while helping out the B&M stores the most; the Rio Grande side would probably be hurt badly.  From a business side, I can see them going either way, so it probably comes down to how strongly Christian Petersen feels about this issue.

So if both Mayfair and FFG decide to enforce this, would it make a difference for the B&M stores?  It could, although I still don’t see it as a long-term solution.  It could also further fragment an already fragmented hobby, which would be unfortunate.  Overall, I don’t think this is quite as big an issue as some have made it out to be, but it will be interesting to see how it plays out in the months to come.

While I sympathize with what Mayfair is trying to do, and while it’s clearly a move they are doing becuase they believe that the retail end of the business is out of whack and not just because they want to pocket a few bucks, it still frustrates me.

The problem here, as I see it, is that they are extending blanket “protection” to B&M game stores when those game stores are not of equal quality or value to Mayfair. A well-run online game shop like Boards & Bits is every bit as valuable as a good retail store. Yet this pricing policy effectively protects B&M stores and punishes (to some degree) online stores regardless of quality. Your average incompetantly-run hobby store that stocks a couple board games and has a staff that knows nothing about them (or worse) gains the same benefit as a well-run store. We all know there is huge variation in the quality of B&M stores.

I’d much rather see Mayfair reward the good stores directly with promotional materials, super-discounted product, or whatever, rather than have a blanket and somewhat arbitrary pricing policy. But that might require them to do real work, and actually figure out how much B&Ms really contribute instead of generalizing based on a gut feeling.

Eric,

Re: “My column is twice as long as yours if that means anything.”

You and I both know that it’s not the size of your column, but rather what you do with it, that is the measure of the man.

And just because at first glance your column APPEARS to be longer (in the chill of this October day), doesn’t mean that mine, with the ministration of some welcome comments, can’t grow to a size that overshadows yours.

I don’t think the Mayfair protects B&M stores and punishes (to any degree) online stores. The policy really does’nt effect B&M stores who don’t discount, and increases the profits per unit sold of the online stores. Increasing the profit margins (by their own admission) of the online stores punishes them how?

Peace

By lessening the number of units sold, Brent.  Mayfair products will now be more expensive than those of their competitors on the online shops.  Many gamers will go with the cheaper options.  Others will prefer to support an FLGS, since they won’t be saving money with the online purchase.

Many gamers will go for the cheaper options? I don’t get this, you will choose to buy a different game because the discount went from 35% to only 20%, even though you really want the Mayfair game? The difference on a $40 (MSRP) is a mere $6. There still is a 20% discount allowed for online retailers, so they still have the edge over the B&M retailers’ price wise. If the game is good, folks will buy it.

Speaking personally, I buy games based on the quality of the game and other factors. Price is extremely low on the factor scale.

The only possible way I could see for an online retailer to lose money under the new Mayfair policy would be to sell fewer units than the price increase offsets. Just throwing out numbers...the difference on a $40(MSRP) game between 35% ($14 off) and 20% ($8 off) discount is $6. Assuming the Retailer paid $20 (I am just guessing) for the game, the difference in profit is $6 or $12 bucks. He would have to sell less than 50% of the games he originally would have to lose money. Someone else more versed in the particulars of the Distributor pricing can probably correct me, I am just ball parking. I am guessing, but I would bet that no ($40 MSRP) game will sell 50% less because of a $6 price difference.

It would be interesting to revisit this topic in a year or so to see the final results. I am predicting that if this is successful that other publishers will follow suit. Ultimately, the market will decide the value of policies like this.

Peace

Don’t forget to factor in the difference in sales tax.  Most of us don’t pay sales tax in online purchases.

Given shipping costs, it won’t take much of a price increase to make online shops uncompetitive on price. Retailers are unaffected by this move, but online shops are made less competitive because they can’t offer as much discount as they otherwise would. Making their competition less competitive is clearly a significant advantage. If I have a choice between paying $40 + shipping for a $50 retail game instead of $33-ish, the online shop has completely lost their price advantage, for that game anyway. As long as I have a local shop, I might as well go there and I can get the game right now.

Unfortunately for the retail shops, they’re often losing the battle on both price and service, so many may still have to get better to compete with online shops for our business even with the online shops giving up their price advantage. Since many retailers have shown little desire to do that in the past, we may not see much change in the environment except that we will pay higher prices to online retailers (probably one reason they aren’t that concerned).

One other factor - there’s more to it than just price.  My FLGS smells like ballsack and the employees are aholes.  I don’t care what the price difference is, I won’t be shopping there.

In this case, TH and B&B both offer a MUCH better service for me than my FLGS.

Still no one mentions this policy favors the big box stores and sites like B&N, Amazon, and ToysRUs, leveling the playing field for them, and ensuring they are willing to stock Mayfair games in their stores regularly.  If Mayfair succeeds with the floor, then they will more than make up for the loss to the niche market by a huge influx in sales to the casual gamer.  This is a price change to appease the major retailers, it has absolutely nothing to do with protecting the FLGS.

Mayfair is entitled to do things as they see fit, but that doesn’t mean that I think this decision is going to be a good one for them.

While I don’t honestly see if affecting my game-buying decisions too much, it might affect others. I find that I don’t buy that much from them, anyway. I would have to agree with David Fair’s assessment that they are “a second tier publisher with one strong product line (Settlers)”.

Their production model does not do anything to help this assessment - waiting to buy the English language edition is never fun and Mayfair’s wait seem to be double that of other publishers. They’re less willing to take a flier on new titles, presumably because they are not are not splitting printing costs with a German publisher.
They seem to be hesitant about publishing new titles - even Klaus Teuber’s titles are getting missed or heavily delayed. In many ways, they seem to be a publisher that is not really sure what they want to be (not as bad as Fantasy Flight, but the confusion is visible).

Looking over my purchases in the past year, I have bought two Mayfair games due to heavy discount (Elk Fest (a clearance of a game that took way too long to get to the US) and Age of Discovery (not a clearance)), two for full price - one that I was going to buy no matter what (Pillars of the Earth) and one that was an impulse buy (Downfall of Pompeii (which is a poster child for the problems with Mayfair’s production model - it took so long that I had to actively work hard to avoid getting a German edition of the game and the lag allowed me to read a lot of reviews. Had it been a dog opted for another title). I also bought some out of print titles that I found in stores on my travels (Cosmic Encounter).

In looking back at these purchases, I would not have bought Elk Fest at list or anywhere near it - it’s an okay game, but there’s just not enough for me to justify the list price for my purchasing dollars. I also would not have bought Age of Discovery - while it is a good game, I added it to the cart at the last minute due to the low price the vendor had it at. Admittedly, I am an atypical buyer - I buy most things locally and have already been paying the higher price most of the time.

Finally, I’m saddened to see that they’re *still* not showing up on the “ask the publisher” segment here - what’s up with that?

Sean Brown, you might have just nailed it.. great point!

I speculated on one of the threads - and I stand by my prediction - that this is a step toward a mass market attempt. 

1 - Management overhaul. 

2 - Product facelift: Settlers is graphically redesigned, spiffy new plastic insert.

3 - New retail rules to protect retailers *including interested national chains* Personally, I predict Target (it worked for Out of the Box and Apples to Apples).

They’ve already tested the mass market waters with some success on X-Box Live.

Very good column, Scott.  It’s refreshing to hear an opinion on this issue from someone who, at least part time, works in the game business.  Most of the reaction to this issue seems to be from people who have no idea how the game business works and most of it is completely ridiculous.  Also, the amount of righteous indignation over a few dollars per game is hilarious. 

I’ve talked to people at Mayfair over the years and they have always been very supportive of the brick and mortar stores, which they consider very important.  People can yell and scream as much as they want that the online stores are just as good or better for gaming, but the people at Mayfair (and certain other game companies) have given me the opposite impression - they mainly attribute the growth of the hobby, and their business, to the brick and mortar stores.  And they oughta know.

To me, this move looks to be a way of leveling the playing field, at least somewhat.  That’s speculation, of course, but it wouldn’t surprise me.

And for those who think this propping up of prices for brick and mortar stores is something new, well I hate to tell you this bucko, but it isn’t.  There are lots of machinations behind the scenes that are used to keep the game prices at reasonable levels to support the brick and mortar stores.

If Mayfair thinks this is a good move I’m willing to give them the benefit of the doubt - they’ve been in this business a long time.  We’ll see how it goes.  As for the ranting and raving of the gamers who have no idea how the game business works…

If Mayfair games were sold in large retail stores, which I’m assuming they are not (WalMart, Toys R Us), this would affect these prices as well, as these stores often do deep discounts since they are relying on customers buying a whole shopping cart full of merchandise on any given trip.

In Germany, that is an issue, since all department stores and toy stores have a decent selection of gamer’s games.  Spiel des Jahres winners, especially, are usually sold at discounts matching any internet retailer.  That’s why German Brick and Mortar game stores never make any money off the SdJ winners--it’s easier and cheaper for them to buy a couple copies from their local department store sale and resell them in their stores, when needed by their regular customers.

Days of Wonder, from what I understand, has long held a similar policy as Mayfair, and took action against Toys R Us (Germany) when they discounted Zug um Zug/Ticket to Ride the same year it won SdJ.  Yet I don’t hear people complaining or threatening to boycott DoW.

I think Eric knows a bit more about this? (Sorry, Eric--great column, but the real action in the comments seems to be here...:)