Cover Story: Advancing to the Next Level

In addition to the financial benefits offered by its PowerUp Rewards program, GameStop has been pleasantly surprised with the amount of actionable customer data the endeavor has yielded.

"The great thing about our loyalty program is it gives us a lot of cross-channel insight into what our customers are doing," notes Freeman. "Not just asking them what they're doing, but being able to gather the actual data. They're using a loyalty number as they interact with us across all channels, so we get a ton of insight into cross-channel behavior.

"Also, within that loyalty program there are opportunities for consumers to tell us more about themselves. They can set up their profiles, give us demographic information, their game library. One of the things we incentivize customers to do is share with us what games they own or they've been playing. As they continue to purchase and show interest in other games, we can continue to build upon that."

A Social Community
With over 1.5 million Facebook fans, 73,000 Twitter followers and its own YouTube channel, GameStop has established itself on the various social media platforms. It may not have had a choice. The gaming community is a highly engaged one, says Freeman, driven in large part by word-of-mouth.

"If you spend a little bit of time on our Facebook page and look at the number of comments on every sort of posting … it's a highly engaged audience," Freeman says. "We see this in our brick-and-mortar stores, too. Gamers are very passionate about games. They like to share information, share recommendations. We get a tremendous amount of reviews on our site; lots of feedback from our customers."

GameStop uses social media for two distinct purposes, Freeman says: branding — e.g., making consumers aware of programs in its brick-and-mortar stores, announcing new titles, giving fans early insight into games that haven't yet been released; and driving sales. Facebook is now the third ranked driver of traffic to GameStop's website, and the retailer is looking into extending e-commerce functionality to the social media platform.

Using Video to Engage
Used to promote every game it sells, video is critical to GameStop's success. Inherent in selling games, both online and in-store, is the ability to show prospects what they're buying. GameStop's website therefore is loaded with as much video as possible, and its brick-and-mortar stores have GameStop TV, the brand's private channel that delivers content to shoppers. In addition, GameStop recently launched kiosks in its stores that serve as interactive guides. Shoppers can walk up to the touch-screen kiosks and view trailers and get other information about games.

"The key metrics of our site look much more like a media site than an e-commerce site," says Freeman. "If you look at page session times, page views per session and those types of metrics, we look much more like a media site. In many ways, that's the way our customers use our site. A lot of visitors come to our site to view a screen shot, read up on games, read reviews, watch the trailers, then they ultimately buy in our stores."

That behavior illustrates the cross-channel nature of GameStop's business. With up to 350 new stores planned to open this year, profits up 4.8 percent in last year's fiscal third quarter and fourth quarter forecasts calling for a 2 percent to 4 percent increase in same-store sales, GameStop's business is a model for all cross-channel retailers to follow.