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Wizards Is Abandoning the LGS. Can Magic Survive?

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I should start by stating that I do not believe Magic: the Gathering is anywhere near some sort of precipice in which a single step over-dooms the game, nor do I believe that smart Local Game Store (LGS) owners will all go out of business.

Does Wizards of the Coast Still Need the LGS?

When Magic first began in 1993, the internet was in its very infancy. Local game stores and hobby stores were the lifeblood for many hobbies. I fondly remember going to my local hobby store to play Warhammer with friends. I bought my miniatures, paints, books, brushes, and dice from this store. I honestly think my love for medieval fantasy as a whole exists only because of that store.

I was introduced to Magic in 1995 by a classmate, and began to buy packs from my LGS. My first non-kitchen table game was the Invasion release tournament at my local game store. I invested in Magic because I had a great place to play and socialize with people who had similar interests.

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When I moved to a new state in high school, the local game store introduced me to new friends and helped me grapple with a major life change. For me and likely many others, the LGS is a beloved business, and one that is paramount to developing one's hobbies.

However, after reading a fantastic blog post by a large LGS owner who wrote a deep dive into their business, I feel like changes are definitely coming to many LGS business models. In th article, Michael Bahr mentions that their store buylisted much of their Magic singles inventory in 2022 following what they viewed as constant inventory value erosion due to the never-ending reprints from Wizards of the Coast:

The canary in the coal mine for us was not the pace of reprints in products such as Modern Horizons 2 or the Secret Lairs, though neither of those helped. Rather, it was seeing literally hundreds of Commander reprints every six weeks as new Standard and Commander Legends sets included multiple Commander decks and a refreshed List to top it off.

Michael Bahr

He discusses multiple cards that have plummeted from $20-$40 cards down to bulk rares, which while nice for players looking to pick them up, can be devastating for stores that operate on low margins with a glut of inventory. In fact, this strategy by Wizards clearly is aimed at new player engagement at the expense of established player's collection value.

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While Wizards continues to claim they aren't in the secondary market, I would argue that selling a very small subset of cards in a Secret Lair is essentially a print-to-demand singles selling model. It is glaringly obvious when Wizards chooses one very valuable card and two cheap cards, slaps on new artwork, and stuffs them in a box that everyone is buying the valuable card, and the other two are just throw-ins (looking at you, Bitterblossom Dreams). Wizards is of course free to do this, as they own the rights to the cards and a smart business does its best to make money.

However, there is a hidden cost to this strategy that it seems Wizards is ignoring. If stores feel it is no longer profitable to sell singles, they will stop doing so. That means a reduction in competitive events, as singles sales have much higher profit margins than sealed sales. This in turn means a reduction in active players, and fewer boxes and packs sold, as players don't tend to invest into games that rarely get played.

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Wizards of the Coast seems to have forgotten that its relationship with the LGS is symbiotic. While they do throw a bone to LGSs every once in awhile with some sort of in store exclusive or freebie, eroding a store's inventory by potentially thousands of dollars and then giving them a free $150 bonus won't keep stores in business, let alone happy.

This reminds me of John Nash's theorem regarding game theory, as found in the bar pickup scene from A Beautiful Mind. Nash theorizes that he and his friends should ignore the individual best choice given in favor of a "best for the group" approach.

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In this instance, Wizards of the Coast had previously agreed to not maximize profit, and leave room for their LGS partners to make money in order for both to grow and be profitable. It seems Wizards has decided to now "go for the blonde."  This approach will likely net their top executives nice bonuses as sales targets and profitability goals are met and exceeded, at least for the short term. But I can't help but feel like the cost doesn't outweigh the benefits.

Does the LGS Need Wizards of the Coast?

The inverse of our intial question is equally important. As Bahr points out, smart LGSs pivot to what is best for them. They only have so much money to allocate for products at any given time, and inventory that has a slow or non existent turnover must be ignored.

If you were an LGS owner, and your livelihood and that if your family was dependent on selling hobby enthusiasts products, it would make perfect sense to suggest the best option for the customer and for yourself. Say someone comes in looking to try out a new game, and is open to a few options. Why not first suggest the game that best helps your business? Especially because the one that is best for your business is also going to be the one that you support the most, whether that looks like having a larger sealed inventory, more singles, or a more active play scene? The customer will then have more access to the products they want and more opportunities to enjoy those products.

Flesh and Blood, for example, is a recent trading card game that has shown tremendous growth in the last few years. Their core mission is "to bring people together in the flesh and blood through the common language of playing great games," and they help accomplish this by heavily promoting in-person play at local game stores. According to the game's creator, James White, "playing in-person at the local game store level" is the most basic core concept of the game. By focusing on in-person play, the creators affirm that the local game store plays a critical role in the games overall success, which in turn guarantees that the local game store will profit from the game's growth.

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I do imagine it may prove difficult for many stores to transition away from the "cash cow" that was Magic: the Gathering for so many years. But given Wizards' other recent blunders, it seems quite obvious that upper management values dollars and cents over happy customers. The D&D community pushed back with the one thing that Wizards understands (to wit, their wallets), and cancelled numerous subscriptions. This will either serve as a wake-up call to the company and they will permanently altar course, or they will bump the heading a smidge and head right back towards the same horizon.

Arena: The Elephant in the Room

Lastly, I want to discuss the effects of MTG: Arena on the game as a whole. First, the positives:

  • It offers people who were/are unable to go to play at local game stores a venue to enjoy their hobby
  • It provides a free way to grow the playerbase
  • It provides a way for people who have limited free time to play the game
  • It provides Wizards with lots of additional data points regarding the formats supported, which can allow them to sculpt the formats faster should they become unfun/boring

As for the negatives:

  • It greatly reduces in-store demand for the supported formats, especially Standard, which is extremely bad for stores. Standard and its constantly shifting metagame used to be one of the biggest drivers of singles sales for the LGS
  • It creates a mentality of "concede and move on" rather than trying to win from a difficult position
  • The ability to draft "for free" by saving up one's gold in a given week eliminates a lot of the casual drafters from in-paper events, as they can get their fix for free
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The first and last of the negatives feed into the point of this section as yet another example of LGS income being syphoned away by Wizards.

Two Questions Answered; Many Remain

It is important to remember that we live in a time with a plethora of options to keep oneself entertained. There is no shortage of video games, card games , and board games, all vying for what free time we do have. Stores have limited inventory space and money to spend on said inventory, so the smartest ones will focus on the products that are best for them.

I would argue that Wizards of the Coast still needs the local game store in order to survive, but they seem to have forgotten that, making decisions as though their games will survive solely through their own force of will. If I owned a local game store, I would diversify my offerings, which reduces risk and potential losses. And that diversification would look like a reduction in support for Wizards of the Coast products.

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David Schumann

David started playing Magic in the days of Fifth Edition, with a hiatus between Judgment to Shards. He's been playing Commander since 2009 and Legacy since 2010.

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