UPDATE: Games Workshop have put the Indomitus box on Made To Order for a limited time! (https://www.warhammer-community.com/2020/07/13/missed-indomitus-well-make-you-one/)
This is the perfect response to the situation and most importantly gives a big middle finger to scalpers who were hoping to profit from a limited supply of copies. I hope to see more of this limited release with a delayed Made to Order wave in the future. It solves so many problems.
A new edition of Warhammer 40,000 should be a cause for celebration. A revamp of the rules for the world’s biggest war game. Exciting new models and of course a fancy box full of treats to kick it all off. If you just look at the Games Workshop webstore and Warhammer Community website you’d be under the impression that the launch of #New40K is going perfectly. Brand engagement is at an all time high and the first major product of the new edition, Indomitus has sold out everywhere within an hour of stores, both web and physical, opening up their doors.
Sure some will have missed out but Games Workshop have said they did their best to make sure there was enough copies of Indomitus available for those who wanted them. They even limited the number copies people could purchase in a single order in an effort to maximise availability.
Sadly the scourge of Warhammer hobbyists struck again and struck hard. They are more destructive than the green menace, more cunning than the Eldar, and deadlier than the Tyranid Hive Fleet. The Scalpers came for Indomitus and have made off with a bounty of riches, again.
Scalping is the practise of buying a often limited product, usually in bulk to resell at an inflated price. It is typically done with ticket sales for music concerts. It is a quick way to turn a profit that weaponises the notion of supply and demand.
Scalping is a creeping horror that has slowly become a major problem for Warhammer fans. Games Workshop is a business that sells specialist products and they do it very well. One prong of their strategy is to have limited run boxes and sets of models that are sold at a much lower prices than they would be separately. A deal so good that hobbists feel compelled to snap it up. A strategy that has worked so well over the years that a more permanent version of it was introduced with the Start Collecting! boxes. Smaller bundles of models from an army that are the perfect jumping on point for the hobby.
Sadly wherever there is an opportunity to turn a quick profit there are those who will take advantage of the situation for their own ends. Which is exactly what has happened with Indomitus. If you look at the sentiment online it is clear that a lot of people who wanted to pre-order the box were unable to do so. Meanwhile eBay is flooded with complete Indomitus boxes for sale at twice the price or broken down into smaller chunks all being sold to give the seller 100% profit once the transaction is done.
The problem here isn’t the second hand market. It is often the best place to get a good deal or obtain models that are no longer being made. The problem is this obvious cash grab that happens with every big limited release Games Workshop does. The thing that exacerbates it is that there are few deterrents in place to discourage scalpers.
Scalping is such a problem in the live entertainment industry that stricter and stricter selling practises have been enforced over time. Things like not being able to resell your ticket to a concert at all or being able to give it to a friend. You bought it, you need to be there on the night for the ticket to be usable.
Meanwhile Games Workshop are quite happy letting people buy up to three copies of Indomitus per transaction (down from six, to be fair). Partnered third party sellers have to manage their stock themselves. Bigger retailers are able to enforce a one per customer policy. While many others have a fiduciary duty to sell as many copies as possible. Which means a guaranteed bulk purchase a premium product become a necessity.
The end result is that Games Workshop and partnered retailers make a profit. With the scalpers making even more of a profit. The ones losing out however are the people that make the hobby work, the customers. It may be sustainable short term and give a nice boost to Games Workshop’s stock value. However in the longer term it could become a huge problem if it is left unchecked.
How do I know this? Let me tell you about The Great Comic Book Crash….
In the mid-90s lots of older comics started selling for huge amounts both at auction and in private sales. You know the usual suspects, Action Comics No.1, Amazing Fantasy No.15 the first appearances of Superman and Spider-Man respectively. This lead to a lot of people suddenly turning their attention to the comics market as an investment opportunity. First appearance issues of new characters sold out in record time along with big shocking events and twists. The comics industry, mainly Marvel Comics, responded in kind. Flooding the market with new characters, bigger twists and even bigger event. They also started selling limited run covers and printings of individual issues. The first appearance of a new character was worth some money but the first appearance of a new character with a holographic cover that only one hundred copies were made of was worth more. At least in theory.
More and more comics were being printed. Stores were snapping them up. Collectors and resellers then buying all of them regardless of the quality of the product within the covers of the book. It was a gold rush for the comics industry.
Then people tried to sell the limited comics they had poured hundreds and thousands of dollars into…
They quickly found that nobody wanted to buy the first appearance of a character now one outside of the comics market knew of at an inflated price. Other collectors already had the same comic book so they didn’t want it either. Fans didn’t get the chance to buy or read the book when it first came out because it sold out everywhere. They had no attachment to the character or product being resold.
So scalpers suddenly stopped buying all of the limited run comics. The impact of which was devastating for the comics industry. Retailers had excess stock they couldn’t shift, publishers had comics that were being printed that no one wanted to buy.
Lots of comic book stores folded, Marvel filed for bankruptcy. It was chaos.
I can see a similar thing happening with Warhammer products if Games Workshop are not careful. If left unchecked they will create a closed loop of a market. They announce a big limited release but the customers don’t buy it because they know the scalpers are going to buy all of the copies up before they get the chance to buy one. The scalpers see diminishing returns and think twice about bulk buying the next limited product. The next product comes around, again the customers stay away, because at this point why should they bother? The scalpers buy less. The cycle repeats with the scalpers buying less each time. Suddenly Games Workshop and retailers have a glut of unsold products with no one to buy them.
The hobby market crashes for Games Workshop.
Unlike the comics industry crash which involved multiple players and survived because of a diverse line up of products from multiple publishers. Games Workshop is very much a market of one. There are other war and miniature games but none of the size and scale of Warhammer. So what happens when no one wants to buy it anymore because of a poor customer experience and unbalanced supply and demand?
It crashes. It burns. It disappears.
Put stricter rules on buying and selling Warhammer products. Make it harder for scalpers to scalp and easier for customers to buy.
- 1 box per shipping address online
- 1 box per customer in store
- Use ticketing systems on pre-order days for big product releases
- Be clearer about the quantities available to purchase
- Work with partner retailers to ensure they are selling to actual customers
All things that Games Workshop can start implementing right now. So that they’re ready for the next big release. People will still miss out, others will still game the system to make a quick buck. But it will be a fairer system and more people will be happy.
Happy customers equals engaged customers which equals profit.
That’s what the new Games Workshop of the past five years has been doing. They are in danger of losing their happy customers again and we all know what happened the last time their customer base shrank.