GameStop is the largest video game retailer in the world. The franchise has 5,700 stores in 14 different countries. It is best known to gamers as a place to trade-in and buy pre-owned games. The retailer also sells many collectibles, POP figures, and other licensed merchandise.
Well, there is a lot of history behind the largest video game retailer. In recent years, GameStop has seen a loss in profit and has closed many of its stores. The rise of the digital era has made the franchise rethink its business strategy. For some, it may be sad to see their favorite game store suffer in a competitive market. That said, GameStop is undoubtedly a household name, but how did GameStop get to where it is today and how much of it did you know?
10 GameStop Started As Babbage's
GameStop's roots start in 1984 with a store named Babbage's. The retailer opened up its first store in Dallas, Texas, at the North Park Center. The business gained investor money from Ross Perot. Perot was a politician and billionaire who saw potential in Babbage's.
Babbage's focused on many software products but moved to video games early on. At the time, the Atari 2600 was extremely popular. The retailer then began to sell Nintendo games in 1987. Babbage's became a publicly-traded and owned company the following year. Eventually, the store's profits were primarily comprised of video game sales.
9 GameStop Was Established By Harvard Students
Harvard is one of the most prestigious universities in the United States. GameStop happens to be a byproduct of such a school. James McCurry and Gary Kusin attended the Harvard Business School together. The two classmates became entrepreneurs and established Babbage's in 1984. Kusin went to establish other businesses, such as a cosmetic company. He now serves on the board of Electronic Arts.
The Harvard students came up with the name Babbage's from Charles Babbage. Charles Babbage was an English mathematician, philosopher, inventor, and so much more. The man is widely known for creating the first mechanical computer. His first design paved the way for modern computers.
8 Babbage's Merges
Babbage's goes through a lot of merges in its lifetime. Just the next decade after the business goes public the business merges with Software Etc. in 1994. The company focused on personal computing software and was a part of the NeoStar Retail Group. However, the two businesses, Software Etc. And Babbage's, operate separately. During this time, there were several changes in leadership roles.
Unfortunately, in 1996, NeoStar decided to merge the two companies into a single entity. Leadership changes continued as decreasing profits continued. Eventually, the merged businesses were known as Babbage's Etc. where they opened the first GameStop. As you know now, they focus on selling new and used video games.
7 Barnes & Noble Buys Babbage's Etc.
The same year Babbage's Etc. opened 30 GameStop stores was the same year Barnes & Noble purchased the company. In the fall of 1999, Barnes & Noble purchase Babbage's Etc. for $215 million. Barnes & Noble is the sole reason GameStop holds many of the brands it has today.
Around the same time, Barnes & Noble also purchased another video game retailer, Funco and Game Informer. All of the Funco stores were rebranded as GameStop stores in 2000. Barnes & Noble held the stock control of GameStop for many years before distributing the stocks to give GameStop its own independence.
6 GameStop Makes Its First Purchase
GameStop became its own independent company in 2004. It finally had its own independence where it thrived. The retailer purchased EB Games the following year for a little more than $1 billion. EB Games was originally known as Electronics Boutique, where it specialized in similar products as GameStop.
Of course, this one purchase sparked numerous other purchases in the following years. Rhino Video, Free Record Shop's, and Micromania were three retail store chains that gave GameStop the reach they needed to thrive. From the span of 2004 to 2016, the GameStop brand did exceptionally well.
5 PowerUp Rewards Obtains Big Subscriber Count
In the heart of its success, GameStop launched the well-known PowerUp Rewards program. The program allows members to save money off select purchases. When the program launched, GameStop obtained more than 10 million members in its first year. This was hugely successful for GameStop and propelled them forward in their endeavors.
The program is still up and running. Higher-tier members of the reward program also receive issues of the Game Informer magazine. The issues can be received via print or digitally. The program also launched alongside exclusive downloadable content amongst certain game titles.
4 GameStop's' Reasoning For Finger Printing
Some of you may know the process of trading in a game at GameStop. The process requires a picture and fingerprint, which may seem excessive for some. However, the common practice derives from the Philadelphia police department. According to GameStop, the police department required them to take the fingerprints of those who trade in games starting in 2014.
The law is primarily for pawn shops to crack down on stolen goods. GameStop is not required to abide by the pawnshop laws but decided to make the change to work with local police departments. There were many customers who did not find the rule to be necessary, but since then, it has been a common practice for trade-ins.
3 GameStop Opens MovieStop
In 2004, GameStop took its first step in other media markets. For many, movies were the obvious choice. MovieStop started with 40 locations. Most of these locations were directly attached to GameStops. The chain focused on the retail movie scene in a similar way GameStop handled games.
MovieStop would sell and buy used movies. Unfortunately, MovieStop did not do as well as its video game brother at the time. In late 2014, a company known as Draw Another Circle purchased the company. Two years later, the retail movie store shut down.
2 The Attempt At Apple
Simply Mac was a reseller and repair of Apple products. Apple officially authorized the company to do so. It was founded in 2006 and was stationed out of Salt Lake City. GameStop purchased the minority stocks of the company in 2012. The next year, they obtained the remaining stock shares.
GameStop did its best to handle the new acquisition with care. Their objective was to create new locations for the Simply Mac brand to live. As you can guess, the project did not succeed. 2017 marked the year the Simply Mac company would start to fall. GameStop closed many of its Simply Mac Stores and replaced them with ThinkGeek stores.
1 Nobody Wants To Buy GameStop
If you are caught up on the most recent news of GameStop, then you will know that the largest video game retail store is not doing well. The company has reported a large drop in sales since 2017. Just last year, the company was in talks of selling itself to Sycamore Partners.
Sycamore Partners is a private equity firm in New York. Nevertheless, the firm did not purchase GameStop. Instead, GameStop announced in early 2019 that it was no longer looking for someone to buy them because they had a lack of available finances. The video game retailer continues to lose money in the growing digital world.