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Showing posts with label financial analysis. Show all posts
Showing posts with label financial analysis. Show all posts

Sunday, July 12, 2020

The Perils of a Loss Leader Strategy - More Things I Think I Think About Indomitus

It is still radio silence from Games Workshop on the fiasco that was yesterday's Indomitus launch, though the speculation and posturing on social media obviously continues unabated. Comments seem to fall into a few distinct camps, but there is the prevailing concept that Games Workshop made a huge amount of money yesterday with Indomitus selling out in minutes. While no doubt they had a banner sales day, in order for a company like Games Workshop to make money, they have to bring in more revenue than they spend on producing and marketing their product.  Based on their typical pricing model, I find it hard to believe that the new box is a real profit machine on its own. In fact, I firmly believe Indomitus was designed as a "loss leader" to bring new players into the stores, and from this perspective it likely failed miserably.