GameStop employees report harmful 'Circle of Life' policies

Update: GameStop CEO responds to accusations of staff pressured into misleading customers - "nothing could be further from the truth"

Staff at GameStop stores are reported to be deliberately misleading customers about the availability of new games and hardware in order to comply with new sales quotas set by headquarters, avoiding the sale of new stock rather than face potential punitive measures.

The report comes from Kotaku, which has spoken to a number of anonymous employees and scoured the GameStop Reddit. According to those sources, GameStop HQ has issued an edict under the name of 'Circle of Life' (CoL) which insists that both stores and individuals secure the right mix of new and second hand game sales, loyalty card subscriptions, pre-orders and trade-ins or face disciplinary consequences.

Each member of staff, and each outlet as a whole, is expected to match these areas to total activity, with each being assigned a percentage of the total. Used sales and trade-in are based on transaction value, loyalty card sign ups and pre-orders by number of transactions. So, every customer who only buys new games or hardware without contributing to these other quotas damages the store or employee's ratio, making them more likely to face repercussions.

To avoid this, staff have reported that they will lie about stock availability to avoid the total transaction cost or number rising and thus having to meet increased quotas elsewhere.

"We are telling people we don't have new systems in stock so we won't take a $300 or $400 dollar hit on our pre-owned numbers," an anonymous employee told Kotaku. "This is company wide and in discussions with my peers it is a common practice. We also tell customers we don't have copies of new games in stock when they are on sale-for example, Watch Dogs 2 is currently $29.99 new and $54.99 pre-owned. We just tell them we don't have the new one in stock and shuffle them out the door."

GameSpot has issued a fairly evasive statement in response.

"All of GameStop's internal programs are designed to provide our customers the best value in all their video game purchases, including new and pre-owned merchandise. With any program, opportunities arise for improvement and we will continue to refine it to equip our knowledgeable store associates to provide a great store experience."

Update: GameStop CEO Tony Bartel has issued a memo in response to the company's employees, addressing and, for the most part, disregarding reports of misleading sales tactics related to used games.

In the memo, which was obtained by Kotaku, Bartel acknowledged the accusations that performance metrics attached to GameStop's “Circle of Life” program had, “placed pressure on store associates to mislead customers on the value of certain products.” More to the point, he broadly rejected the accusations, stating that, “nothing could be further from the truth.”

“We want every customer to get the product and deal that is right for them - whether that be a new or pre-owned video game product, digital game or collectible. The Circle of Life generates great value for the customer. Consider these facts: GameStop issued approximately $1 billion of trade credits to our customers last year. 70% of the time, those trade dollars were immediately spent on new gaming products.”

However, Bartel did admit that the “behaviors” described in Kotaku's initial report were “disappointing,” but, “they don't represent the vast majority of our associates and how they treat our customers.”

Kotaku has also heard from “dozens” more GameStop employees since that report was published, “almost all” of which confirmed that Circle of Life quotas had resulted in more pressure on individual employees and stores.

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Latest comments (6)

Alan Blighe Research Associate A year ago
Interesting policy! In the early 2000s I used to work for their competitor, Game, and we were meant to highlight used games too. But nothing was monitored, and there was certainly no pressure to reach targets. Was a pleasant job. Things have changed quite a lot!
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Paul Jace Merchandiser A year ago
This was one of the reasons I never worked directly for Gamestop, because I didn't want to be pressured for used sale quotas. But this seems so much shadier and much much worse than it was before. They could face a class action lawsuit over this
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Jordan Lund Columnist A year ago
This is a common problem in retail: Taking things that are optional for customers and making them required for employees.

30 years or so ago, when I worked for Software Etc., one of the multiple companies that would become GameStop, it was the same deal. Push worthless things because of corporate mandate or lose hours, get hauled into mandatory meetings, etc. etc. etc.

What they don't realize is I don't need to spend my money there. I don't need to pre-order a game that's going to be produced in the millions of copies. If you want to hassle me, that's cool, I'll buy from Amazon, cheaper, and avoid the human interaction entirely.
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Bonnie Patterson Narrative Designer, Writer A year ago
Am I missing something or is setting targets for your stores in this particular manner kind of... stupid? I can understand wanting staff to push certain products as opposed to certain other ones, but to set things up so you are penalised for selling a lot of a popular product ... is that money no good or something?

If they don't want it, can I have it?
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Jeff Kleist Writer, Marketing, Licensing A year ago
@Bonnie Patterson: GameStop buys back a game that came out yesterday at $30, they then sell that copy for $54.99. A new copy actually makes them $10 or more less, especially a few weeks down the road when they cut the payment to $20 and under, compounded when those numbers are in store credit and not cash. And we're not counting all the copies that come in, in multiples, still shrinkwrapped, of games that came out last week.

That's the reason why consoles that come with digital keys come with physical copies at GS. They, like WalMart on other products, have the market share to demand it

Developers hate it because their royalties are sabotaged by this. It was the reason behind the Xbox 24 hour check in, so that developer would get royalties on resales. We've tracked a single copy of Call of a duty going in and out of a GameStop six times in a year period. Over 35% of our copies churned at least twice, and all of them generated more profit for GSthan a new copy.
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Diana Hsu Product Manager, Free-to-Play, Big Fish GamesA year ago
@Bonnie Patterson: I agree. I'd think that even if your goal is selling more used games, it would be best just to set a quota for a selling used games. The ratio goal just seems silly, since the obvious answer there would be to decreased the number of new games you're selling to improve your numbers.
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