Friday, 24 January 2014

A crisis of their own making?

I have written quite a bit about Games Workshop, but I would actually prefer not to. Partly because it's a bit obvious and partly because I don't actually buy a lot of their models or play a lot of their games any more. Not because of any particular hostility, but simply because I have bought so many over the years that I am past the point where I want any more.

But there are some events that a bit too big to not comment on. Events like this. After some pretty terrible financial results which have seen Games Workshop's turnover and, more importantly, profit fall, 25% of the value of GW shares was wiped out.

The reaction to this news has been interesting, consisting partly of schadenfreude, partly smugness from those who expected this to happen sooner or later and a more moderated reaction from people who think this may be bad for wargaming in general or feel sorry for people who actually work for Games Workshop. There has been very little in the way of vigorous defence of Games Workshop, even though they are still making money at the moment and the supportive comments have been muted.

This feels like part of a trend. There has always been plenty of hostility to Games Workshop on the Internet, but in the early days it was matched by some equally aggressive support. But over time this support has transitioned from passionate, to realistic, to faintly desperate to what feels more like resignation.

Games Workshop has always been hostile to the Internet gamer community. As well you might if your attempts to run a message board turned into a deluge of criticism and complaint. But the official line, from both GW and its more aggressive supporters (now few and far between) is that the Internet complainers represent a vocal minority and can't be taken as representative. If you took the Doctor Who "fan community" as representative you would think Doctor Who was the worst and least popular program on British television and the only debate was over which era was the worst of all.

Nevertheless it is funny how the anti-Games Workshop are so passionate and vocal, while the die-hard fans are so quiet and introverted. And, as the positive voices have grown quieter, the hostile voices become slowly more representative. It seems that the gamer community's perception of Games Workshop is that it is:

1. Expensive;
2. Making products of declining quality;
3. Contemptuous of its customers.

Masterminis has published an interesting series of blogs on Games Workshop, its declining fortunes and Games Day events which include their thoughts on the recent downturn. They're all worth a read, if only because they're written by someone who has some understanding of how to run a business and isn't just spewing his ill-informed opinions across the blogosphere, but two comments in part seven really caught my attention. Both of them relate to UK Games Day 2013, the games day where Games Workshop didn't see fit to have any games. The first is from a nameless GW spokesperson and reads:

"Our Games Days are designed to allow our fans to do what the love most: Buying Games Workshop products."
"Our Games Days are designed to allow our fans to do what the love most: Buying Games Workshop products." - See more at:
"Our Games Days are designed to allow our fans to do what the love most: Buying Games Workshop products." - See more at:

I think this phrase may be an official corporate response, because it was also used by Alan Merrett, in court, at the GW versus Chapter House lawsuit (the latter was accused of ripping of GW's IP).

The second comment is from Masterminis and reads:

"...I enjoyed the show, because I could meet up with many new and long-time friends at our traditional Pre-GD-Dinner and during the show."

I think in those two phrases we have the perfect encapsulation of Games Workshop's problem. I think that Games Workshop has a fundamentally different perception of itself than its customers.

As far as Games Workshop is concerned they make the best games and models in the world. They can afford to charge premium prices because they make a premium product and their customers know and appreciate this.

However, I think what really shifts Games Workshop's products, and the reason why they are still profitable even in decline, is because of the community of Games Workshop players. And I don't mean that in a "we couldn't do this without the fans", gushing, Oscar acceptance speech kind of way, I mean it purely pragmatically. Games Workshop produce products for games, the majority of their customers are gamers and they play a game that generally requires two or more players and that benefits from having a large player base. The easier it is to find players and the more of them there are the better.

As the largest war games company and the producer of the most-played games, Games Workshop has an automatic advantage. It is easier to find opponents if you play Warhammer 40,000 than for any other games, perhaps not as easy as it used to be, but still easier than the competition. Spend any amount of time on the Miniature Page and you will find discussions about find new players for a game or trying to persuade friends to try a new game. This rarely happens with Games Workshop. The player-base is established.

However, this advantage is an historical legacy, not a result of current policy. Games Workshop is essentially living off the legacy of decisions made in the 1980s and 1990s. Warhammer 40,000 is effectively the wargame equivalent of Windows; people use it because they feel they have to, not because they think it's the best. It also means that buying Games Workshops models is not necessarily and endorsement of them.

Most game companies recognise the importance of their community, which is why message boards are so common. You risk negative feedback from disgruntled players, but this a price worth playing to encourage a player-base to grow. And without a decent core of players a game is worthless, no matter how sublime the rules or beautiful the models.

Games Workshop's community largely grew before the advent of the Internet, so for GW it has always been a hostile force, giving voice to their critics. They shut down their own message board because it was so hostile, don't allow comments on their blogs and treat communication as a one way channel, which makes them seem distant and out of touch. They have chosen to treat online criticism as unrepresentative and have refused to learn any lessons. This isn't to say that everyone who complains about Games Workshop has a point, but when the same complaint is made over and over again, ignoring it is perverse.

For a long time Games Workshop has been coasting on their past success, assuming that the community would always be there because of the quality of their products. This down-turn may indicate the point at which their negative behaviour overtakes their positive past. If that is the case they are in a very dangerous position, because if the community contracts too far their advantage is lost. Games Workshops fall could be more rapid than its rise.

1 comment:

  1. I think there are similar trends at work with GW today, that were at work with say WoTC fifteen or twenty years back.

    That said. GW is successful still. A single (very significant) stock price drop does not kill a large scale enterprise. My opinion on this is, lets see how they are doing come July.

    I've gone from love to disdain with GW, but I do agree with you I think the net is abuzz with schadenfreude and smug "I told you so" I've been ranting against GW for nearly six or seven years now and I honestly don't feel very happy about all this.

    If GW were to really get in trouble and actually go under, it would be a very black day for me (not that I don't think they wouldn't just go into receivership and recover from it ultimately).

    I hope they turn things around soon and this becomes a watershed moment, a nice wake-up call for them.

    Who knows though ... we'll see ... with the Oldhammer revolution most of the old guard seems to be going the way of the OSR guys with RPGs. I think most old school hardcore GW fans are just playing GW how they want with the models they want to use.

    I am stuck in the 1998-2002(ish) era for GW myself. That was my golden age for GW and it is likely where I'll end up playing. 3rd/4th ed. 40K and 6th ed. WHFB. I know many others out there are in Rogue Trader and 3rd ed. WHFB, etc. So even if GW went out of business totally we'd all go on with our merry tabletop gaming lives. Post GW-Apocalyptic gaming could be really interesting ... who would rise in their place ... would anyone ... strange questions that hopefully we never see the answers to.