“It is true, that consumers don’t migrate the way people think they do. Most in fact just disappear when their channel that they buy from ceases to exist.”

This assumes that new recruitment for customers into the hobby can’t make up for the loss. When GW was the primary source of new recruitment, I would concede that point. I don’t think they are anymore. We’ve spoken about regional differences in the past, so I’ll leave off the YMMV disclaimers, but in my experience most new hobby gamers are coming in through warmahordes, Magic or high profile kickstarter campaigns.

I would agree that many existing gamers would just quit if GW were to fail (which they’re not even close to doing at this point). But I think we could recover in a year or two with a combination of Privateer Press, WoTC and well-run kickstarters from the talent that they would expel out into the industry.

Fantasy Flight could be poised to make a big mark as well if they can get their supply chain issues worked out (big if). If they could just work out their production issues, Wings of Glory, X-wing and DUST could make them a behemoth, but they couldn’t juggle all of those balls simultaneously and ended up selling off two very promising game lines (admittedly the WoW line set backs are as much Nexus’ fault as FF’s). Battlefront might be in a good position to run with DUST, but Ares is clearly struggling with production issues similar to what FF dealt with (which is sad because I absolutely love Sails of Glory and Wings of Glory). Wings of Glory starters have been out of stock for months now.

Take away the largest competitor (the same one that bullies local stores into devoting half of their shelf space to GW product), and you could see major shift in player recruitment. There are several companies currently in GW’s shadow that could really make a dent if they could get some breathing room. They may get the chance anyway if GW’s market share continues to fall. Because overall sales for the industry are up. GW’s falling sales indicate a decrease in market share for them, not the end of gaming as a whole. The more their market share decreases the smaller the impact of a GW collapse becomes. And GW isn’t going out of business any time soon (if at all). So their market share will almost certainly continue decreasing before their collapse would actually become an issue.

“The recruitment issue would depend on just how great a proportion of recruitment currently comes via GW as the bulk of that recruitment would be lost.”

I don’t see why the bulk of that recruitment would be lost. When talking about new recruitment we can rule out questions of loyalty because none has yet developed. Recruitment at GW stores would certainly be lost, but recruitment into the line that normally occurs at independent stores (which, in my country, is most of it because GW stores make up a much smaller percentage of the overall retail chain) could easily be redirected to other companies and lines. As I’ve said in previous discussions about GW’s retail tactics, many of the stores I have personal experience with are already trying to push other lines as their primary source of new customer recruitment. I would only expect that to become more common as GW’s overall market share continues to decline.

“To what extent do sales of GW product prop up the LGSs and how many would go if GW went away? In terms of stores already diversifying in the recruitment, we can discount those as recruiting the hobby via GW.”

Fair questions. I can give you only anecdotal evidence (so, speculative obviously). In the US, Wizards of the Coast keeps most game stores open. Magic is our 40k. It’s a game that encourages constant spending too (even more so than GW does), which makes it a good revenue driver if you can establish a community of players. Pretty much every game store (in various states) I’ve seen in the last five years is being propped up by Magic more than anything else.

So losing GW would certainly cause problems for LGSes in North America, but it wouldn’t necessarily close many doors. As for recruitment in to the minis hobby, it generally depends on the owner. Most store owners sell Magic to stay in business, and promote whatever mini games they most enjoy playing themselves. Sometimes that’s GW product, often times it’s not. If there are any clear winners beside GW in this race for store owners’ hearts and minds, they would probably be Warmahordes and Flames of War, though X-Wing has gained a surprisingly large base of support in the short time it’s been around (and FF’s sales figures support this assertion, but no one knows if it’s sustainable long-term).

This increased diversity in the landscape of the US LGS could explain why we account for such a smaller share of GW’s overall sales compared to the UK. And it could also explain why fewer American gamers are freaking out over a possible GW collapse. I’d hate to see the hobby balkanized by regions, but I think a diverse ecosystem of product lines is more stable than over-relying on one gargantuan producer whose waxing and waning fortunes could tip the whole industry over.

But hey, the hobby will live on, even if it’s not as popular. Clubs will continue to exist. Online retail will always make niche products available (though I would prefer to keep a couple LGSes in my area). 3D printing, digital distribution of rules/sourcebooks and open communities can pick up the slack and keep those of who refuse to quit happy. I’m not worried really at all. Regardless of the industry, I’ll still play games. I’ll still find others to play them with. They’ll just be different games.

I’ve never personally tied the fate of the hobby to the fate of the industry. This was a hobby for decades before there was any real “industry” involved. (A couple of vanity press books by HG Wells do not count as an industry.) And there’s always kickstarter (though I foresee crowdsourcing regulation happening someday. There’s too much unaccounted-for tax revenue on the table for government to ignore it forever).

@apocryphal

There are, sort of. The Game Manufacturer’s Association (http://gama.org) is a non-profit trade association for game makers. They took over the Origins convention. They collect sales and distribution numbers from affiliated distributors and retailers, but the numbers are incomplete because a lot of independents don’t see how reporting would benefit them (short-sighted).

Then there’s the Professional Games Store Association (http://progamestores.org/), newly formed that is attempting to be exactly what you’re asking for. Their unfinished website is not terribly promising.

There are a couple others (pretty sure there’s an org tracking distribution in North America). I’m sure there’s a European equivalent. There’s no way you can have something like Spiel de Essen every year and not have someone keeping track of the industry that makes it possible.

Problem is that most of their reports are only available to members (companies), so we have to guess based on what little public data is made available.

“I have no idea which one it is, but presumably GW do and would be acting accordingly.”

That’s the confusing bit. GW sends mixed signals, and I’m not sure they actually have a coherent retail strategy in North America. I’ve seen independents flourish with near wholesaler discounts on their stock, and I’ve seen independents forced out of business by blatantly predatory expansions of GW retail stores into their region. And I’ve seen both happen in the same cities within a couple years of each other (their strategy before, during and after the ’08 recession changed dramatically and could best be described as “predatory”).

If GW has data that helps them decide how to deal with independents in the US, their tactics on the ground give us no clues as to what that data tells them. Because they can’t seem to make up their minds except to try their damnedest to stifle online wholesalers. That’s the one constant in their US strategy, but it benefits their own stores as much as (if not more than) it benefits independents.

I think the one thing that is clear to independents out here: Don’t trust GW to be friendly for long. They change their minds at the drop of a hat. So even if they are being supportive of LGSes now, they’re not a reliable long-term business partner.

There’s no reason to even talk about bankruptcy right now. GW’s revenues have dipped. Their market share is decreasing. Their stock value took a little tumble. They’re not even remotely close to going bankrupt or selling things off.

The stock value decrease, more than anything, simply reflects that GW has achieved a certain degree of market saturation (in the eyes of their shareholders). They have little room left to grow, and shareholders are primarily interested in growth. Lots of very successful companies have done just fine after reaching similar saturation points and losing a large chunk of their stock value (Starbucks, for instance). The sell off represents investors who bought their shares at a lower value a long time ago cashing out for the highest profit they think they’re going to get. It’s not a sign that the company is doomed or that the sky is caving in.

It’s mostly just a sign that this industry has grown larger than the one big company that used to define it. If the industry were to diversify and the market were to expand to allow other competitors to successfully enter it, then this turn of events for GW would be pretty much inevitable. Stock value doesn’t represent what most people think it does. It’s mostly a reflection of growth potential, not long term stability. GW’s stock could fall another 25% before, and then another 25% after that and we still wouldn’t necessarily be talking about company failure (though we would certainly be getting closer).